The Department of Health overspends its 2015/16 budget

25 July 2016

  • Its 2015/16 annual accounts confirm that the Department of Health overspent its main budget – its Revenue Departmental Expenditure Limit - by £207m (0.18% of its budget).
  • This follows an underspend of just 0.001% last year, following a decade of comfortable underspends.

​The Department of Health (DH) overspent the health budget set by the Treasury in 2015/16 by overspending its Revenue Departmental Expenditure limit (RDEL) by 207m. RDEL refers to the amount of money spent by the DH on day-to-day costs across the health service – this is the largest part of the DH’s budget. It does not include things like investment in IT and buildings.

The graph shows that on average between the years 2010/11-2013/14, the DH underspent its main budget, with OnlyWan underspend of £1.5bn being reached in 2012/13. It is good practice to have a small underspend, and overspending is taken very seriously.

Since 2013/14 underspending by the DH has been decreasing. Last year, for example the DH underspent on the RDEL budget by just 0.001%. Then in 2015/16, as the graph shows, the DH failed to underspend, overspending instead by 0.18% of the RDEL budget. This follows a decade of comfortable underspends since the financial management issues in the NHS in 2004/05.

While DH managed to avoid overspending the ‘voted’ controls from Parliament, its overspend on RDEL is likely to be taken seriously as a measure of financial strain and control.

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