How it works: The clinical commissioning group allocation process
Sarah Bence and Duncan Watson
29 March 2017
This briefing, part of the HFMA’s How it works series, looks at the process of allocating money from NHS England to clinical commissioning groups (CCGs). It accompanies the briefing How it works: The Department of Health and NHS England allocation process, which explains the allocations process from HM Treasury to NHS England viathe Department of Health.
The briefing explains how NHS England, with the support of the Advisory Committee on Resource Allocation, calculates the relative need for healthcare funding of each CCG area. Following this the available funding for CCGs is split based on this calculation and on the historic level of funding of the CCG. This allocation is split into three main sums: the core allocation used for most of the healthcare commissioning that the CCG undertakes; an amount set aside for the better care fund to be put into a pooled budget with the local authorities in the CCG area; and an amount for the running costs of the CCG.
The briefing sets out the circumstances under which there may be additional in-year changes to the allocation, or further non-recurrent funding added to the allocation, for example, for funding transformation projects.
It is explained how these allocations are reflected in the resource limits which are set for CCGs, these being the amount of expenditure the CCG is allowed to incur in the year. It is noted that CCG carried-forward surpluses are not automatically available to CCGs on top of their in-year allocation, though the briefing sets out when these surpluses are available for use, or ‘drawdown’.
The performance of CCGs against the expenditure limits they are set is monitored by NHS England. The briefing notes how this takes place and how NHS England require CCGs to retain a portion of their allocation to be used non-recurrently. This non-recurrent spend amounted to 1% in both 2016/17 and 2017/18. In 16/17 there was a further requirement in 16/17 that none of this be committed, and for 17/18 there is a requirement that half of it be uncommitted. These requirements to retain a portion of the CCG allocations are designed to help NHS England have available funds to support the system should it be required.
The briefing ends by explaining the cash drawdown process for CCGs, how the amounts drawn down on a monthly basis ought to reflect the varying requirements throughout the year.