The Health Bill appears to create extensive potential for the NHS Commissioning Board to bail out consortia.

The board is given power to “establish a contingency fund” then pay out of it in broadly defined circumstances – although it must publish guidance about how it will use the fund beforehand.

The board may also establish “pooled funds” with one or more consortium which can be used “towards expenditure incurred in the discharge of any of their commissioning functions”.

In addition to these abilities the board has a power “to provide assistance or support to a commissioning consortium”, including money, staff time or any other resources. The board can specify terms and conditions, the bill says, “impose restrictions” on how the resources are used.

Similarly, the bill allows for “two or more consortia to exercise functions jointly or on others’ behalf and [to] pool funds” between themselves - potentially allowing groups of smaller consortia to share risk, or share some commissioning functions across a wider patch.

The government’s July white paper said “there will be no bail-outs for organisations which overspend public budgets”.

But last month’s Liberating the NHS: Legislative Framework and Next Steps document said the board, “will have powers to enter into financial risk-pooling arrangements with consortia on the commissioning side”.

The document said the board could create “some form of weighted ‘insurance’ premium [for consortia] to ensure appropriate incentives for good financial management”.

This could mean a transparent form of budget pooling. It could also be a mechanism to mean small consortia are more financially viable.

Separately, the bill provides for the board to make performance related payments to consortia. The July white paper said they would receive “a premium for achieving high quality outcomes and for financial performance”.

The bill says each consortium will distribute the money “among its members in such proportions as it considers appropriate”.