Labour backlash grows over NHS reforms

Tony Blair's problems in persuading the Labour Party to support reforms of the NHS have been hit by another setback, as the senior representative of backbench opinion warns that she is opposed to the proposals.

Jean Corston, who chairs the Parliamentary Labour Party, has privately warned government whips that she is not prepared to vote for legislation that will enable NHS hospitals to transform themselves into "foundation" hospitals, with greater freedoms to run their own financial affairs. The whips' office has already informed the Prime Minister that the plans are likely to trigger the biggest backbench revolt any Labour government has seen.

As the PLP's elected chair, Miss Corston meets Tony Blair every week to keep him informed of the state of backbench opinion. Her decision to join the rebellion against foundation hospitals is almost unheard of for someone in that position. It is a sign of how the measure has provoked opposition from MPs with a previous track record of loyalty to Mr Blair. Before she was elected to head the parliamentary party, Miss Corston was parliamentary aide to David Blunkett.

Other MPs normally loyal to the Government who have declared their opposition to foundation hospitals include Julia Drown, a former director of the Radcliffe Infirmary in Oxford, and the former health secretary Frank Dobson.

Opponents claim that the plan is also causing dissent within the Department of Health because civil servants have allegedly been put under pressure to upgrade hospitals which have a two-star rating under the department's classification system and rate them with three stars so that they would qualify for foundation status.

This claim was dismissed as "nonsense" yesterday by a spokesman for the Health Secretary, Alan Milburn. "It shows that people who are opposed to democracy in the NHS are prepared to create any myth in order to avoid the argument around the proposal," he said

"What we are trying to do is get people to focus on what is in the legislation, but there is a little myth factory at work so that people are saying they are opposed to foundation hospitals because of things that aren't actually there."

The proposal, in a Bill published last month by Mr Milburn, has run into widespread opposition from Labour MPs and health unions, who claim that by encouraging hospitals to compete, it will create a "two tier" NHS, with patients in foundation hospitals getting superior treatment, and that it could increase the number of private patients in the NHS.

Mr Milburn contests both claims. He says that every NHS hospital could be a foundation hospital within five years, and that the legislation will strictly limit how much private work they can do. He claims that the purpose of giving hospitals foundation status will be to bring them under local control, rather than having them run by central government.

Although the Bill was published last month, MPs have still not been told when they will debate it. Mr Blair has been warned by whips to expect a rebellion even bigger than the one he faced over the Iraq war. He has overruled advice that he should delay the legislation for at least a year.