Pressure on Tony Blair to scale back his plans for foundation hospitals intensified yesterday after he lost two votes on his flagship policy to give greater freedom to high-flying NHS trusts.
The conference defeat, the Prime Minister's third in nine years as leader, prompted Downing Street and John Reid, the Secretary of State for Health, to concede that there should have been greater consultation on the plans over the past year.
But Mr Reid refused to back down on the principle of extending choice over health care from the rich to the poor. Mr Blair also made clear that he would still push ahead with the proposals despite the boost that the votes gave to Labour rebel MPs and peers hoping to scupper the Health and Social Care Bill in Parliament.
Frank Dobson, a former health secretary, said the House of Lords was more likely to amend the Bill next week with a clause insisting that a pilot scheme must be run before foundation hospitals can be rolled out across the country.
The party leadership was defeated on two votes, the first a Unison motion calling for the scrapping of the policy and the second a constituency motion backing the principle of devolving power in the NHS. The Unison motion was carried overwhelmingly on a show of hands, while the pro-government motion was defeated by 55 per cent to 40 per cent on a card vote, largely due to union block votes outweighing support from local parties.
Mr Reid made a direct attack on union self-interest in an impassioned speech defending the principle of his proposals. He braved hecklers as he said that the new hospitals would not affect the NHS's central principle of offering free health care based on need and not ability to pay.
He pointed out that while the Unison leader Dave Prentis was representing 450,000 members, the Government had to represent 60 million people and had a duty to implement reform that alleviated the pain and suffering of those waiting for treatment. He said today's patients demanded choice over where and how they were treated.
Mr Reid added: "It's all about patients. People in pain, not about systems or structures or inherited institutions. That is what this Labour Party should be doing. It's what this Labour Government should be doing."
After the vote, Mr Reid conceded there could have been more discussion of foundation hospitals. "If I was to go back again I would give further discussion to it; we've got to learn from that," he told BBC Radio 4's The World At One.
Earlier, in the debate Mr Prentis attacked the Government for drawing up the "ill-conceived" plans without consultation. He said: "This Bill isn't about devolution; it's about separation, it's about splitting off, hiving off with no vision, dividing the best from the rest."
Sir Bill Morris, the retiring general secretary of the Transport and General Workers Union, warned that the structure of foundation hospitals could be used by a future Tory government as a route to full NHS privatisation.
"For the first time, Labour seeks to legislate for inequality," he said. "Excellence for a few, misery for the many."