Ministers insist foundation hospitals are not privatisation

With health service unions claiming opposition to the idea of foundation hospitals is growing, Tony Blair has been holding crisis talks to try to quell the fears of Labour rebels.

Under controversial proposals in the Health and Social Care Bill, foundation hospital trusts would be allowed to raise private money on the open market and set their own clinical priorities.

Tony Blair is proposing something which even Maggie Thatcher did not have the bottle to do Des Turner Labour MP Analysis: Revolt on the home front

Health Minister John Hutton on Friday rejected claims that the plan meant parts of the NHS would be privatised and a two-tier health service created.

Foundation hospitals are expected to be allowed to set separate pay and conditions for staff.

Unions are bitterly opposed to the plans, and are planning to launch a major new campaign to try and get them scrapped.

Campaign plans

Almost 130 Labour MPs have now signed a Commons motion condemning the plans.

Dave Prentis, general secretary of public service union Unison, told BBC Radio 4's Today programme: "The opposition is growing, it is growing by the day."

Delays mean the bill is now unlikely to be put to Parliament until after Easter.

Bill Morris: Plans would put a "dagger to the heart of the NHS"

Mr Prentis said the TUC and individual unions would be meeting with Labour rebels to devise a campaign to halt the plans in their tracks.

It was likely to spark opposition at the Labour Party conference, he suggested.

Bill Morris, general secretary of the Transport and General Workers' Union, praised the government for committing extra funds to healthcare.

But the foundation hospital plans were a "distraction that will put a dagger through the heart of the National Health Service", he told Today.

"Foundations hospitals will be concentrating on running a business, not private healthcare," he added.

'Betrayal'

Critics of the plans say they will mean the private sector is expanded as hospitals try to raise the money to repay the extra money they borrow.

Labour MP Des Turner said: "Tony Blair is proposing something which even Maggie Thatcher did not have the bottle to do and that is to partially privatise the health service.

"We regard the foundation trust idea a betrayal of the NHS ethos that we have all fought for."

With the government suffering record rebellions on the Iraq debate, some Labour MPs appear to have a new determination to speak out against policies they do not like.

Mr Turner said: "This could get very serious indeed if there is not some rethink on the part of the government.

"It is something that could cause the biggest crisis that we have had in the Labour government with the Labour Party, even greater than that difficulty over whether to go to war with Iraq."

Public benefit

The hospitals will operate on a not-for-profit basis and will be run in part by a board comprising members of the local community.

They will be established as "Public Benefit Corporations".

Health Secretary Alan Milburn has said every hospital will be able to apply to become foundation trusts within five years.

His junior minister, John Hutton, insisted the proposals could not be described as privatisation or even as expanding the private sector.

Hospitals already borrowed money from the government, repaying the debts with the money primary care trusts paid them for performing operations, he said.

The principle was just the same with foundation hospitals, argued Mr Hutton.

"There will be no co-payment, there will be no charging for services, there will be no elitism within the NHS," he went on.

Mr Hutton also stressed that foundation trusts would stay within the "NHS family" and meet the health service's principles and standards.

"They are not being sold off to anyone, they are actually being given back to local people," he added.