Although they have the money, many NHS hospitals do not have the facilities to provide the extra wards and operating sessions that are needed to clear the lists.
Frank Dobson, The Secretary of State for Health, said yesterday that an extra pounds 32m would go to health authorities as a "performance bonus" to reward those that had cut waiting lists, because figures showed that hospital spending on private agency nurses had doubled in five years.
A hospital in Coventry would use its share of the money to provide a second "clean air" theatre, significantly increasing the number of orthopaedic cases that could be treated. Redbridge and Waltham Forest Health Authority, in London, would invest the money in techniques to reduce the use of invasive surgery.
But it emerged that East London and the City Health Authority planned to spend pounds 200,000 on surgery at the private London Independent Hospital, where a room costs between pounds 250 and pounds 350 a day.
A spokeswoman for the health authority said: "It is very difficult to switch capacity on and off. This is the only way we can deliver quick treatment for people on the waiting list."
The pounds 32m performance fund - 10 per cent of the pounds 320m allocated nationally for cutting waiting lists this year - was intended to encourage best practice, but it is understood that all health authorities will receive a share.
Stephen Thornton, director of the NHS Confederation, said that the use of private hospitals and private agency nurses was diverting money from the NHS.
The British Medical Association joined the attack by calling on the Government to treat patients according to their clinical need rather than their position on a waiting list.
In a discussion paper published yesterday, which draws on experience abroad, the BMA said that when patients were put on surgery waiting lists, they should be given a score that reflected the severity of their condition and how quickly they needed surgery. There ought also to be national guidelines so that patients knew they would be given the same priority for surgery wherever they lived.
Dr Peter Hawker, chairman of the BMA's consultants' committee, said: "We must move away from the present focus this government has on total numbers waiting for surgery and look at the clinical priority of those awaiting surgery."