The decision underlined the pressure on Virginia Bottomley, Secretary of State for Health, to implement hospital closures proposed in the Tomlinson report.
As regional cash allocations to the NHS were detailed, Mrs Bottomley said 'substantial' further sums had been set aside to improve health care in London.
Overall, regions are getting only a 2.7 per cent cash spending rise in line with the Government's core estimate of inflation. Only the assumption that the Government's near-freeze on pay will hold allows ministers to claim that they have honoured the manifesto commitment of real-terms growth in the NHS as far as health authorities are concerned.
Assuming pay rises are held to 1.5 per cent, health authorities overall will get 0.8 per cent growth on the Government's figures. Tim Yeo, the junior health minister, admitted during Commons questions yesterday that demographic pressures such as the rising numbers of elderly people will add 0.5 per cent to demand.