NHS England has belatedly managed to set plans to balance its £97bn budget for 2014-15.

The budget has been balanced in part because clinical commissioning groups are expected to perform worse than was budgeted for against income linked performance targets, HSJ has learned.

HSJ reported two weeks ago that plans submitted in late June by CCGs and NHS England’s own commissioners showed an aggregate overspend of £137m against the commissioning system’s £97.3bn spending limit for this financial year.

This was driven by specialised commissioners in London planning a £65m overspend, and a £74m financial gap due to “small numbers” of CCGs planning for increased deficits or to invest surpluses they built up in previous years, according to an NHS England board paper.

NHS England cannot afford for CCGs to reduce their overall surplus this year because it has allocated the entire £400m surplus that commissioners are permitted to “draw down” in 2014-15 to offset a potential £800m overspend in its own specialised commissioning budget.

However, HSJ understands that plans are now agreed that would see both the CCG sector and NHS England’s specialised commissioners break even against their overall spending limits. For CCGs, this is due in part to a number of groups agreeing to reduce their planned level of surplus draw down.

The remainder of the gap has been closed because NHS England has received new performance information indicating CCGs will be entitled to less money under their pay for performance quality premium scheme than the authority originally budgeted for.

Under the quality premium policy, CCGs will be given bonus funding in 2014-15 based on how they performed against a range of metrics in 2013-14. The maximum that could have been earned this year was £270m.

When NHS England allocated funding in December, it estimated the actual payout would be £200m. But sources with knowledge of the situation said the latest performance information suggested NHS England would underspend against this budget by tens of millions of pounds.

However, negotiations are ongoing between NHS England and a handful of CCGs - most of which are planning larger deficits in 2014-15 than they recorded in 2013-14 - about their proposed plans.

In specialised commissioning the budget has been balanced because some planned non-recurrent investments in London are now expected to come “a bit later” than previously thought, and some assumptions about growth in drug and other costs have been revisited, sources told HSJ. The NHS England London area team is now planning to break even against its spending limit, as are the other nine local area teams that commission specialised services across England.

The financial position for the NHS commissioning system in 2014-15 remains extraordinarily tight. NHS England chief operating officer Dame Barbara Hakin told its board this month that some risks in specialised commissioners’ plans were “very significant”.

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