Frequently Asked Questions

The deadline for applications to the Integrated Digital Care Fund has now passed.


Can expenditure on follow-on costs (rows B1 to B4 on the Financial Planning template) count towards our matched funding contribution?

No. Matched funding applies to initial project costs only. If your application is successful, the Integrated Digital Care Fund will provide up to 50% of your initial project costs. You must match that contribution with at least the same amount of either capital or revenue investment within three years.

My organisation is planning to deploy a new system based on Open Source software. If the core software is free to use can we still class our other project costs as capital expenditure?

Yes you can still class your other projects as capital expenditure. As long as you are creating an asset that delivers benefit over more than one year (normally many years for an IT system) you can usually capitalise most of the associated costs. This applies to systems based on Open Source software just as much as products with up-front or ongoing licence fees and bespoke solutions developed from scratch.

The Value for Money (VfM) guidance states that VAT is a ‘transfer payment’ that redistributes wealth across government. Based on this guidance I have excluded VAT from all costs entered onto the VfM spreadsheet, but included them in the Financial Analysis sheet. Is that correct?

Yes, costs entered in the VfM spreadsheet should exclude all VAT. Doing otherwise actually makes it harder for you to meet the required VfM threshold as you would need to identify £1.50 of financial benefit (£1.00 for e-Prescribing projects) for every £1.00 of VAT included in the spreadsheet.

For example, a digital care record project that costs £1m excluding VAT needs to identify at least £1.5m of benefits to meet the ratio of 1.5 to 1.0. If including VAT increases total costs to £1.2m (assuming they are all non-refundable), the same project would need to identify £1.8m of cost savings or productivity gains to meet the threshold.

Non-refundable VAT should be included in the financial analysis because this needs to show what the project will actually cost you to deliver and, therefore, the amount of funding you need from the Integrated Digital Care Fund. Using the example above, you should include total costs of £1.2m in the financial spreadsheet. Assuming the project needed a contribution of 50% from the fund (the maximum allowed) you would therefore request an award of £600k. If the same project mistakenly excluded VAT from the finance sheet they would be asking for 50% of £1m, leaving a shortfall of £100k.

Can we count the value of staff time towards our matched-funding contribution?

Yes. In most cases, successful delivery of projects supported by the Integrated Digital Care Fund requires a significant investment of staff time to ensure requirements are clearly identified, processes are re-designed effectively and that staff receive proper training. This goes alongside technical effort spent on designing and building new technology solutions. Applicants can include the value of this time in their matched-funding contribution.

How many joint bids could my organisation potentially be party to?

Eligible organisations are limited to one application for projects delivering an internal digital care record or e-Prescribing capability, plus one additional application in partnership to assist in the creation of an integrated digital care record. It is possible that an organisation can be named as a stakeholder in several joint applications, but they can only receive funding from one..
What has this fund previously funded and is there a particular category of applicant that is more likely to be awarded funding than others?

The ‘Safer Hospitals, Safer Wards’ prospectus described the areas eligible for funding in round one. We will be publishing a complete list of successful applicants shortly. In this second tranche of the fund (now renamed the Integrated Digital Care Fund), we set out the areas we are keen to promote in the first section of the revised prospectus (Investment Priorities). All applications must meet the expected level for ‘Project Readiness’ and ‘Delivery Capability’, regardless of any other considerations.

What is the success rate for applications vs grants?

We received over 770 applications for the first tranche, of which approximately 220 were successful. However, there was no limit to the number of applications individual organisations could submit in that round. In this second tranche, eligible organisations are limited to submitting one internal and one joint bid. This means we’re expecting fewer standalone applications.

What is the average amount of the funding awarded?

There are no minimum/maximum awards. In the previous round, NHS England funded projects that ranged from the tens of thousands through to multi-millions of pounds. In the event that the fund is heavily oversubscribed, we may seek to part-fund larger bids to ensure an equitable distribution of money.

Can CCGs and national NHS organisations apply to the fund?

NHS Trusts, Foundation Trusts and local authorities are the only organisations that can apply to the fund directly. However, we welcome joint applications that involve (or are possibly even coordinated by) a CCG or national organisation. In these situations, the application must be submitted by an NHS Trust, Foundation Trust or local authority; the funding mechanisms we are using dictate that monies awarded can only go direct to one of these organisations.

The prospectus states that assets created by projects awarded money from the Integrated Digital Care Fund must be capitalised and remain the property of an NHS Trust, Foundation Trust or local authority. Is there any flexibility within this to encourage innovation with commercial organisations?

In normal circumstances, where a Trust has been awarded Public Dividend Capital we would ordinarily expect this to lead to an asset being created within the Trust’s own books only. It should not normally be used to create assets that commercial organisations will make a financial gain from selling on later.

However, where the Trust and commercial organisation have developed an asset jointly they may wish to agree some form of shared ownership. This should be managed at a local level between the relevant organisations and comply with IFRIC 4 and IAS17, the accounting standards relating to shared ownership, risk and reward.

My organisation is the lead applicant for a joint bid involving multiple NHS organisations and the local authority. Would all assets created by the project be recorded on our asset register and will we be responsible for their ongoing revenue/support implications?

No – you are welcome to agree which organisation registers each asset at a local level. The organisation that registers/holds each asset will be responsible for subsequent revenue and support costs.

 

For further queries please contact: england.nhstechfund@nhs.net.