- CQC reveals it has overspent on budget at start of year
- Cites switch to new digital subscription as one cause
The Care Quality Commission is forecasting to end the current financial year with a deficit of £1.7m.
According to the regulator’s board papers, the watchdog overspent on its revenue budget at the start of the 2019-20 financial year. It cited digital subscriptions, which needed to be treated as revenue but would have previously been covered by a capital cost, as one cause.
Papers to the July board meeting of the CQC reported the “CQC revenue budget is overspent at the end of May by £0.6m and is projecting a full year deficit of £1.7m”.
A CQC spokeswoman said: “It is not unusual to be slightly over or under budget. For instance, in 2018-19 we incurred a slight overspend against our operating budget but still delivered within our 2 per cent [variance from budget] KPI.”
She added the main reason for projecting an overspend in 2019-20 was that the CQC had seen “a shift from capital to revenue investments. This is always a challenge to predict and forecast for and this is the case across government bodies.”
The regulator explained that some digital projects are now cloud based and paid for by subscription. As such, these now carry a revenue cost rather than being one-off capital spends.
The spokeswoman added: “We are actively managing our financial position to address this and are confident that we will deliver a balanced budget for the end of year.”
In previous years, the CQC has reported significant underspends on its budget due to difficulties in recruiting numbers of staff.
According to its annual report for 2018-19, the CQC receives £206m in income from fees plus £28m in funding from the Department of Health and Social Care. Last year, the CQC spent a total of £227m on its inspection and regulatory activities as well as £10m in capital investment.