• NHS England sets aside £156m of reserves and underspends to help boost DH bottom line
  • This has driven an increase in its forecast underspend to £295m
  • Prime minister’s access fund and primary care transformation fund are among programmes expected to underspend
  • Move part of concerted national effort to prevent DH blowing its budget in 2015-16

NHS England has earmarked £156m of contingency funds and underspends on its central programmes to help the Department of Health break even in 2015-16, board papers for its meeting on Thursday afternoon show.

The national body’s latest finance report shows a forecast bottom line underspend of £295m for the commissioning system for the financial year, up from £145m the previous month.

Paul Baumann

Paul Baumann

Paul Baumann said the provider sector was ‘committed to ensuring its deficit will not exceed £1.8bn’

Clinical commissioning groups and specialised commissioners are both forecast to overspend their budgets, although this is cancelled out by forecast underspends on primary care and public health.

The bulk of the improvement in NHS England’s bottom line forecast comes from what the report describes as “£156m of slippage on NHS England programmes which has been realised in order to contribute to the overall financial balance across the Department of Health group”.

HSJ understand this £156m comes from a mixture of centrally held reserves and contingency funds that NHS England has decided to use to improve the financial position, and underspends on centrally run programmes.

Among these, NHS England expects underspending of £20m on various transformation programmes, including the primary care transformation fund and the prime minister’s access fund. The budget for clinical excellence awards paid to senior medics is also expected to be £18.5m underspent.

In recent weeks there have been renewed efforts to drive up the forecast underspend for the commissioning system, while driving down the forecast deficit for NHS providers.

The moves are a direct response to concerns that the DH could be at risk of blowing its overall revenue budget for 2015-16.

NHS Improvement last week reported that the provider sector was forecasting a deficit of £2.37bn. This is above the £1.8bn target the system has been working towards, and includes the benefit of balance sheet manoeuvres and capital to revenue transfers that providers signed up for in January.

At NHS England’s previous board meeting, chief financial officer Paul Baumann said the commissioning system was likely to report a £400m surplus by year-end.

Mr Baumann said the provider sector was “committed to ensuring its deficit will not exceed £1.8bn”.

He added: “That can just about be offset by our underspend and the measures which the Department of Health is putting in place to generate an underspend on central budgets and capital.”

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