Stephen Pollard: Fine words from Brown ­ but had he spoken to the Health Secretary?

I wonder when Gordon Brown last spoke to Alan Milburn. The Chancellor could barely contain his ideological triumphalism as he came to the end of his Budget speech: "To those opposite, who have advocated vouchers, fees, new health charges for medical services or basic accommodation, this is the Government's answer: we have not only rejected these charges but are abolishing hospital accommodation charges, not just for pensioners, but for all who have charges imposed on them through the social security system."

There's just a slight problem with that thrilling reiteration of Mr Brown's hatred of such nasty ideas as giving patients the power to decide how, where and by whom they are treated (the very meaning of vouchers): two months ago, in a speech which no one seems to have noticed, the Health Secretary announced he would be doing just that.

On 11 February, Mr Milburn said: "From December 2005, by when extra capacity will have come on stream, choice will be extended from those patients waiting longest for hospital treatment to all patients. They will be offered choice at the point the GP refers them to hospital. Patients needing elective surgery will be able to select from at least four or five different hospitals, again including both NHS and private-sector providers."

Nowhere in the speech did the word "voucher" appear. You wouldn't expect it to ­ look at the withering way in which the Chancellor referred to the idea yesterday. Labour hates the word, which it regards as a horrible, right-wing construct. But think for a moment what Mr Milburn's words actually mean, if they do indeed come to pass. All patients are to be able to choose where they are treated, and by whom, including private hospitals. The cost of their treatment will be quantified and made available to competing healthcare providers, who will then be free to offer an equal or better service than their rivals. The patient, not a bureaucrat, will decide who carries out the treatment.

I wrote here after Mr Milburn's declaration that it was astonishing how little attention was being paid to an announcement that heralded the most revolutionary reform to the provision of health care since the introduction of the NHS in 1948. I didn't realise until yesterday that that ignorance extended to the Chancellor. He may have "rejected" the idea but the same, clearly, does not apply to Mr Milburn.

Mr Brown likes to portray himself as a man above the knock-about battles of political hacks. He deals only with issues of substance. But read his words again, and a certain cynical sophistry emerges. Mr Brown lumped together "vouchers, fees [and] new health charges". He is not stupid. He is a policy wonk to his core, more well-read in policy ideas than almost any of his colleagues or predecessors.

He surely knows that vouchers ­ or the extension of patient choice ­ are not the same as charges. Charges are little more than a rationing and revenue-raising device. Giving patients the power over the purse-strings necessitates a fundamental change in the structure of the NHS and in the provision of health care. It means patients are not a cost to be avoided but a vital ­ indeed, the only ­ source of revenue.

Could it be, then, that the Chancellor was being deliberately misleading ­ that he was lumping vouchers and charges together specifically to obscure what is now underway in the Department of Health ­ a fundamental rethinking of the role of the NHS? Heavens above! That anyone might even think such a thing of him!

Mr Brown confirmed yesterday that the NHS would be receiving the "extra" £40bn by 2008 first announced in last year's Comprehensive Spending Review. By then, spending on the NHS will have risen to £110bn. In other words, spending on the NHS will then amount to 0.35 per cent of the entire planet's measurable GDP. That Mr Brown considers it desirable, or even possible, for one man to sit at a desk in Whitehall and be responsible for assigning 0.35 of world GDP is almost beyond belief. Put like that, it's little wonder that the Department of Health is taking a different tack, and is seeing how it can shift that spending away from Whitehall and into the hands of patients.

Stephen Pollard is a senior fellow at the Centre for the New Europe in Brussels

www.stephenpollard.net