Revealed: The projects losing out from a multimillion pound tech underspend

NHS Digital published figures last week outlining in detail how central agencies are spending most of the government’s multibillion-pound NHS tech fund, known as the digital transformation fund, for the past three years. 

NHS Digital figures reveal that, as of February 2019, spending on NHS trust’s clinical IT systems was expected to be £174.4m in 2018-19, £62.2m less than budgeted. This is the third year running that less has been spent on “provider digitalisation” than planned, equating to a cumulative underspend of £260.3m.

After a £72.3m boost to cyber security spending in 2017-18 following the WannaCry cyber attack in 2017-18, spending to keep NHS IT secure slumped to an expected £22.9m last year, £34.3m less than budgeted.

Approached for comment, an NHS England spokesman said the underspend for cyber security and digitising providers “had not been lost” and would be moved into the 2019-20 budget.

Smaller underspends were also recorded in several IT projects including improving data on medicines (£7.5m), integrating care (£4.7m) and digital triage (£4.2m).

Overall the figures show that, as of February 2019, NHS Digital was forecasting £522m to be spent on technology centrally across 27 projects during 2018-19, £131.2m less than budget.

However, an NHS England spokesman said some areas of central IT spending were not covered in the NHS Digital figures, including Microsoft licensing, live services such as NHSMail, and the local health and care record exemplars. Including these areas boosted overall spending to £997.6m for 2018-19, with a £31.8m underspend, the spokesman said.

NHS England declined to provide a breakdown of spending for digital projects not included in NHS Digital’s figures or explain the reduction in the overall shortfall by £100m. Both the department and NHS England have repeatedly refused to publish overall figures for how they are spending the NHS’ central tech fund.

NHS Digital figures also show that, since April 2016, the government had spent £1.32bn on the 27 digital projects. According to the figures, a further £1.42bn remains in the tech fund, which needs to be spent by April 2021.

Since its formation, NHS England has cut every one of its significant NHS technology funds, often to support urgent demands on the service.

Previous tech funds, including the £900m estates and technology transformation fund, £240m integrated digital care technology fund and £260m “safe hospitals, safe wards” fund, have all been trimmed to a greater or lesser extent, in some instances by hundreds of millions of pounds.

In January 2018, HSJ revealed that central agencies have spent £256m less than planned on NHS IT in 2016-17, the first year of the current digital transformation fund. Figures disclosed then also suggested a significant underspend on NHS IT was likely in 2017-18, but no overall figures have been made public since. NHS Digital’s recent figures show £534m was spent on NHS IT in 2017-18, but differences in how central agencies measure spending makes a direct comparison of overall spending impossible.

Last month, a Nuffield Trust report found a lack of central investment was one of the biggest impediments to widespread digitising of NHS trusts. 

Speaking about these latest figures, the co-author of that report, Sophie Castle-Clarke, said it was “worrying” that gaps were opening between planned and actual investment in NHS IT.

She said even if the shortfalls were delays rather than cuts in funding, it was still concerning because “trusts can struggle to plan their transformation projects and allocate staff time effectively”.

“More generally, more investment in digital is needed to sustain recent advances made by the global digital exemplars, support them to spread best practice, and enable less digitally advanced trusts to get up to speed.”

King’s Fund researcher Matthew Honeyman added: “These spending figures show that despite the high priority placed on digital transformation by the Secretary of State and other national leaders, funding pledged often fails to reach the front line.

“Significant underspends are a consistent theme throughout the history of NHS technology funding. With the creation of NHSX, it is surely time to reflect on how we can improve the mechanisms for committing and tracking investment.”