What does Reference Cost Expenditure as a Percentage of Operating Expenditure mean?

We have presented this figure so you can see the proportion of trust expenditure that is reported in Reference Costs as this is used as an adjustment factor in some productivity calculations. This adjustment is needed because Reference Cost data does not capture the totality of trust expenditure and by contrast other data sources we have used, such as trust consolidated accounts or Electronic Staff Register (ESR,) include all expenditure by the trust in these areas. 

We do recognise limitations in the use of reference costs, in particular issues with inconsistency in the data quality of reference cost returns submitted by trusts. However, we hope that as reference costs are increasingly used in this way it will drive improvement in the quality of data.

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