NHS Ayrshire and Arran Assurance Board: terms of reference

Authority

The NHS Ayrshire and Arran Escalation Assurance Board (the “assurance board”) has been established in response to  the stage 4 escalation of NHS Ayrshire and Arran on the NHS Support and Intervention Framework for finance, specifically: financial sustainability; financial management and control; and financial governance and leadership. The assurance board is convened at the request of the Scottish Government Director General for Health and Social Care and Chief Executive of NHS Scotland (the “Director General”), further to their letter of 13 February 2026 to the Chair and Chief Executive of NHS Ayrshire and Arran. 

These terms of reference have been set by the Director General, further to consultation with the members of the assurance board.

Purpose and role of the assurance board

The purpose of the assurance board is: 

• to support NHS Ayrshire and Arran in determining what steps are necessary to help mitigate the immediate concerns about the financial pressures, and to stabilise the local system in NHS Ayrshire and Arran, and in doing so support a robust basis for the wider local transformation work required over the longer term
• to advise the Director General, through agreed governance routes, that such steps have been taken

In delivery of this, the assurance board will seek to:

• ensure appropriate governance is in place, particularly with regards to providing appropriate scrutiny of financial performance
• scrutinise the NHS Ayrshire and Arran financial improvement plan and through assurance meetings hold the leadership (i.e. NHS Ayrshire and Arran executive leadership team and the chair of the NHS Ayrshire and Arran Board) to account for the effective delivery of these improvement actions within the timescales agreed
• ensure that the leadership is operating in an effective manner, particularly when understanding and managing financial and performance issues in NHS Ayrshire and Arran
• consider the lessons learned that could be shared across NHS Scotland
• provide advice to the Director General about the future escalation status of NHS Ayrshire and Arran, including criteria for de-escalation

Background

Concerns have been raised in relation to a range of financial and performance related issues specifically: financial sustainability; financial management and control; and financial governance and leadership. 

Stage 4 escalation came into effect from 13 February 2026 and brings direct formal oversight and coordinated engagement from Scottish Government in the form of the assurance board, chaired by Stephen Gallagher, Director of Assurance and Improvement. 

Approach

As part of the standard sponsorship relationship, Scottish Government sets objectives and priorities for the NHS, signs delivery plans with each NHS board, monitors performance, and supports NHS boards to ensure achievement of these key objectives. 

The assurance board is carrying out this function solely in relation to NHS Ayrshire and Arran’s escalation for financial sustainability and the deterioration of their financial position during 2024/25.

The assurance board will provide direct monitoring and support to NHS Ayrshire and Arran but the onus is on the board of NHS Ayrshire and Arran to commit to, and deliver on, improvement.

The assurance board will agree a programme of work in line with the purpose and role of the assurance board (section two). In doing so, it may establish sub-groups with necessary experts and other participants. The remit of the sub-groups will be set by the chair of the assurance board, in consultation with assurance board members. The assurance board will receive reports and consider recommendations from the sub-groups.

In line with the NHS Scotland escalation process, NHS Ayrshire and Arran will work with the assurance board to develop an improvement plan and to take responsibility for delivery. The NHS Ayrshire and Arran chief executive, as accountable officer, continues to be responsible for matters of resource allocation connected to delivering actions agreed by the assurance board.

The assurance board works separately to the NHS Ayrshire and Arran board and does not form part of internal governance structures within NHS Ayrshire and Arran. 

The assurance board will ensure all work is conducted in a way that supports the values of Scottish Government and NHS Scotland.

The work of the assurance board will also be informed by engagement with other stakeholder groups as required, such as NHS Ayrshire and Arran staff, working in partnership with the employee director and staffside.

The assurance board is focused on improvement. Assurance board members, and sub-group members, will ensure a lessons-learnt approach underpins their work in order that learning is captured and shared locally and nationally.

Meetings

The assurance board will meet fortnightly initially and will thereafter determine an appropriate schedule of meetings. 
Secretariat support will be provided by officials from the Scottish Government Health and Social Care Directorates. 
The circulation list for meeting details/agendas/papers/action notes will comprise assurance board members and relevant officials from the Health and Social Care Directorate. 
The Chair and Chief Executive of NHS Ayrshire and Arran will also receive copies of the papers.
Regular reports will also be provided to the National Oversight for Performance and Planning Group (NPPOG). 

Objectives, deliverables and milestones

The objectives for the assurance board are to:

• provide scrutiny and challenge to the NHS Ayrshire and Arran leadership team as they take forward action to improve financial management
• to work alongside the executive team to identify additional savings and efficiencies as well as wider transformation to bring NHS Ayrshire and Arran back to a financially sustainable position
• work alongside the executive team and health board to develop de-escalation criteria  

Matters that are not related to the issues that gave rise to escalation are assumed not to be in scope, unless the work of the assurance board establishes a significant link to these issues.

In order to meet these objectives, the assurance board will:

• ensure access to the NHS Scotland Pyramid of Support, which sets out the types of support available to NHS Ayrshire and Arran, both financial and non-financial, for 2025-26 and planning assumptions for 2026 to 2027
• take advice from on the financial performance and stability of NHS Ayrshire and Arran following quarterly financial reviews attended by the Director of Finance of the health board, and the Chief Finance Officer for NHS Scotland
• seek to gather evidence that short-term stabilisation and improvement is underpinned by credible planning processes for longer-term service transformation that will ensure sustained improvements

Governance

The assurance board will be chaired by Stephen Gallagher, Director of Mental Health, and will report to the Chief Operating Officer, NHS Scotland and the Director General.

See the group's membership.

Members are not permitted to send deputies to meetings of the assurance board unless this is cleared by the chair in advance of the meeting. 

In addition to these members, the chair may request the attendance of other attendees at meetings based on agenda items. The membership may also be amended if additional expertise and advice will be required on an ongoing basis.

External Support to NHS Ayrshire and Arran (as required)

• engagement with NHS Greater Glasgow and Clyde to promote sub-national delivery
• continued support from other NHS boards including but not limited to, NHS Lanarkshire and Golden Jubilee

Stakeholders

The assurance board recognises that a broad range of stakeholder groups have an interest in their work and will seek to ensure their views are represented and considered. In particular the assurance board will work with the board and senior leadership of NHS Ayrshire and Arran, and in partnership with staff of NHS Ayrshire and Arran via the employee director and staffside, as well as the integration joint boards and local authorities in the area of NHS Ayrshire and Arran.