The Cabinet faces the dilemma of imposing pay restraint, weeks before the election, on five million public-sector workers, including GPs, after MPs awarded themselves a rise of 26 per cent this year.
Reports of the pay-review bodies for public-sector workers, including doctors, nurses, teachers, civil servants, judges and the armed forces, are due to be delivered to Downing Street by the end of next month.
Last night, GPs said they will be in the vanguard of protests if their demands for big rises go unheard. The British Medical Association has told the Doctors and Dentists Pay Review Body that doctors need a 58 per cent pay rise in April to catch up with rises for similar groups in the private sector over the past 10 years.
"It is going to be very rocky. Every year it has been getting worse. The Government may think that the doctors will be quiet, but there could well be more trouble because of the coming election," said a BMA source.
Ministers, who have been trying to mollify GPs with a White Paper promising other changes, privately admit rises higher than inflation will be needed. But the Treasury is determined to hold down public-sector pay, only allowing rises financed by productivity. The Treasury made an implicit threat in the Budget that inflationary pay awards in the health service could hit patient care.
The BMA is seeking to head off threats by representatives of the GP fundholders that they would pull out from the NHS if Labour went ahead with plans to replace fundholding with a new system of joint commissioning for services from hospitals by groups of GPs covering an area. The BMA is seeking talks with Chris Smith, Labour's health spokesman, to clarify his policy on replacing fundholding by GPs, which he set out last month.
The National Association of Fundholding Practitioners is due this week to release its response, rejecting his plans.
But weekend reports that fundholders were threatening to quit the NHS were dismissed as "petulant". A BMA spokesman said: "There is a lot of confusion about Labour's plans but GPs are not going to leave the NHS. GPs have around 1,800 patients on their lists. It would mean they would all have to be prepared to pay a substantial sum for their health care in addition to pay for the NHS through their taxes.
"GPs are so well entrenched in the NHS through pay and allowances. Despite low morale, to talk about walking out ... is just not feasible."