FINANCE: One of England’s largest clinical commissioning groups has indicated it believes its funding allocation may be wrong, and said it has an “underlying deficit legacy issue” of £16.6m.
Nene CCG’s April finance board paper state it was expecting to have overspent on its 2012-13 shadow budget by between £16m and £18m at the end of the year, mostly due to unexpectedly high demand for hospital care.
The overspend was due to be offset by “applying uncommitted funding of £12.9m which had been held on Nene’s behalf by the [Primary Care Trust] cluster pending distribution, but which has been allocated to the CCG in Month 11”.
The paper points out that, in 2012-13, “other elements of the [primary care trust cluster are] forecasting large underspends” which “raises the question of whether the basis for apportioning allocations accurately reflects true expenditure levels in 2012-13”.
It says: “Allocation adjustments have been confirmed with the [PCT] cluster and discussions continue regarding the availability of additional allocations.” Nene’s budget is £636m, more than double the average of £300m.
The CCG, which covers most of Northamptonshire, expected to break even in 2012-13, using measures including the release of winter pressure funding.
However, its finance paper explains financial performance last year indicates it will face a funding gap in 2013-14.
It says: “Analysis of the financial position in 2012-13 also reveals that after stripping out the non-recurrent support and any non-recurrent expenditure, the CCG has an underlying deficit legacy issue of £16.6m.”
It says that due to NHS England requirements the CCG must also fund a 1 per cent surplus of £6.3m, 2 per cent non-recurrent expenditure of £12.7m and a contingency of at least 0.5 per cent, or £3.2m.
The paper says this means that “a high level view of the additional commitments the CCG will face in 2013-14 before applying any growth assumptions is… a cost pressure of £38.8m”.
The finance board paper says: “The CCG is forecasting that it will achieve its financial target of breakeven for the full year… The PCT cluster, however, is still forecasting to deliver its required year end surplus and this suggest that other elements of the PCT must be anticipating large underspends.”