Health: Torrid times loom for NHS in wake of final cash increase

Spending on the NHS in England will rise by £8bn in 2007-08 in what is certain to be the last of the years of plenty.

Next year's rise, set before the Budget and confirmed by Gordon Brown yesterday, will be the biggest cash increase ever. It will mark the end of five years of record growth in NHS spending which has averaged 7 per cent a year in real terms since 2002-03.

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The future after that looks bleak. Mr Brown declined to do for health what he did for education and announce the allocation for the years from 2008 to 2011 in advance of the Spending Review later in the year. But the growth rate for the health service is certain to be much lower than it has been in the past. A figure of around 3 per cent is widely expected.

But Mr Brown said: "Taking the whole of the United Kingdom together, I expect total additional expenditure on the NHS from April to be almost £10bn above this time last year - also a 10 per cent rise."

Despite its lack of prominence in yesterday's Budget, the NHS is likely to be a key battleground as Mr Brown goes head to head with David Cameron in the run-up to the next election. With one third of NHS trusts in debt facing a cumulative gross deficit of more than £1bn, the health unions in militant mood over job cuts, local communities mobilising to oppose hospital closures and expensive new cancer drugs coming on to the market, the health service has a torrid time ahead.

Mr Brown's first priority, once he has the keys to No 10, will be to deliver on the Government's central pledge to reduce waiting times from GP appointment to hospital admission to a maximum of 18 weeks by the end of next year.

It is a major challenge and will absorb all the effort and resources that the service has available. But Mr Brown knows that failure to deliver could cost him the next election.