Private sector firms invited to bid for £1bn slice of NHS

NHS services costing about £1bn are to be opened up to competition, the Health Secretary said yesterday.

Patients will be offered a choice of provider, including private companies and charities, across eight services including those for back and neck pain, wheelchair services for children and talking therapies for patients with stress and depression, Andrew Lansley said.

Later, further specialities may be included under the "any qualified provider" provision in the Health and Social Care Bill, raising alarm about the privatisation of the health service.

So far, patient choice has had limited impact in the NHS and is restricted to routine surgery, which accounts for £12bn of costs. It was introduced in 2006 and today 4.1 per cent of routine NHS operations – worth about £500m – are carried out by the private sector, much less than the 15 per cent that ministers originally predicted.

Mr Lansley is determined to increase that figure but was forced to slow his plans for reform after they were fiercely criticised last month at the NHS Futures Forum, established by David Cameron and chaired by Professor Steve Field, a former chairman of the Royal College of GPs.

Yesterday, Mr Lansley insisted that extending choice would give patients more control over their care and better results. "[There is] a mistaken idea that competition is there for the sake of it, or to increase the independent sector's role in the NHS," he said "But... what this is really about... is real choices for people over their care, leading to better results."

Providers will be paid a fixed price determined by the NHS tariff, ensuring that competition will be based on quality and not price. They will also be subject to checks to ensure they meet NHS quality standards, Mr Lansley said. The move comes into force next April and a minimum of three of the eight services must be opened up to choice by September 2012. Opponents of the concept of "any qualified provider" say it represents privatisation of the health service, while others insist it will galvanise the NHS to raise its game.

Ruth Owen, chief executive of the charity Whizz-Kids, said: "We believe any qualified provider will remove the barriers to faster, better wheelchair services by enabling organisations like ours to work collaboratively with the NHS to provide unmet needs, shorten waiting lists and drive innovation."

However, Christina McAnea, head of health at the public-sector workers' union Unison, said: "Patients will be little more than consumers as the NHS becomes a market-driven service, with profits first and patients second."

Dr Hamish Meldrum, chairman of the British Medical Association, said: "When competition results in market failure in the NHS, the ultimate consequence is the closure of services and the restriction of choice for the patients who would have wished to use them."