- DHSC reports underspends against its key revenue spending limits
- Comes after Treasury provided £600m in-year support
The Department of Health and Social Care avoided breaching its key spending limits in 2018-19, after receiving £600m of additional in-year support from the Treasury.
The department’s annual accounts, which were published yesterday and include the financial performance of all NHS organisations, showed a £646m underspend against its Parliament-approved revenue spending limit, representing 0.005 per cent of the £126bn budget.
A separate key spending limit controlled directly by the Treasury would have been overspent without the in-year support. This £124.3bn limit excludes ringfenced spending on depreciation, and was underspent by just £34m.
The accounts said the underspends were achieved “without compromising on wider system support and while safeguarding patients and the wider public”.
The accounts added the £600m of additional support from the Treasury, revealed by HSJ in February, was agreed to cover unexpected pressures, including those driven by no-deal Brexit preparations.
Other pressures listed were:
- additional initiatives to increase supply of future workforce;
- a slower rate of movement from bursary-funded nursing education courses to loans;
- delays in implementation of the increase to the immigration health surcharge;
- price, volume and foreign exchange pressures on demand-led reciprocal healthcare commitments, particularly since the EU referendum; and
- a one-off land sale receipt delayed.
The DHSC said: “While many of the pressures, including those above, were managed, this ultimately did not prove possible for all the pressures arising in the system. HM Treasury agreed to provide reserve funding for unexpected and one-off issues…. and so provided support from their central reserve.”
The capital budget of £5.9bn was underspent by £42m.
Meanwhile, the head of internal audit at the DHSC gave “moderate assurance” in relation to the reporting year, which means that “some improvements are required to enhance the adequacy and effectiveness of the framework of risk management, governance and control”.
This matched the judgement given in the previous two years, following a downgrade from the “reasonable” level of assurance given in 2015-16.