Labour will soften plans to scrap Tory changes to health service

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Labour's commitment to scrap Conservative changes to the NHS, including fundholding, will be softened in a long-awaited document which was endorsed yesterday by Labour's national policy forum.

The draft document, Rebuilding the NHS, by Margaret Beckett, the party's health spokeswoman, will be seen as a response to Tony Blair's demands to make Labour policy more pragmatic.

The Labour leader pledged in April to "renationalise" the NHS and the plans will end the so-called "internal market" and the fundholding by GPs, which has been widely criticised for encouraging queue jumping and creating a two-tier system.

But the changes will be phased in to avoid disruption to the health service and confrontation with doctors, who believe some aspects of fundholding have led to improved services to patients.

No new fundholders will be created, but one source said the system "will not be abolished overnight". Rather it will be phased out over perhaps two to three years as GPs are increasingly brought into joint commissioning of care with health authorities. Labour will argue the aim is to bring the benefits of fundholding to all family doctors without the commercialisation of contracts.

The plans show Mrs Beckett has heeded the warnings by Labour health experts not to throw out some of the changes introduced by the Tories.

"This is a consensual approach. We are not turning the clock back. It is a plan for a new health service in a new century," said one source. "The aim is to make it equitable for all general practitioners and to make sure the changes would be phased in. People are afraid of disruption even though they don't like what has happened."

Another added: "We place a high premium on stability. People have lost confidence in the NHS and our first job is to rebuild that confidence."

Under Labour's plans, health authorities will continue to commission care from separately managed hospitals. But in place of the present annual contracts there will be room for more rolling agreements. NHS trusts will no longer control their own assets, but will remain separately managed within the overall framework set by health authorities. Labour has decided against elected health authorities but appointees are likely to include the local chair of social services, with representatives of GPs from all practices sitting on the commissioning body.

The NHS hospital trust boards will be replaced by local management units which will include elected councillors. "The language is the problem and what to call them," said one insider.

The policy forum agreed its plans as Geoffrey Glazer, a consultant surgeon at St Mary's Hospital, London, complained in an article for the Institute of Economic Affairs, the free-market think-tank, of the "commercial fever which is overtaking old professional attitudes ... Patients are seen as business opportunities and attempts are made to lure these patients from one hospital to another".

Future of the NHS, page 6