A management layer will be cut at hospitals

An estimated �2.6bn is being spent on the health service in Wales this year.

Currently, the funding is filtered through the health authorities to the 16 NHS trusts.

Mrs Hutt has been under pressure in the assembly - particularly from Plaid Cymru - to remove management tiers which the opposition claim are stifling health provision in Wales.

Instead, local health groups will be strengthened, with strategic decisions being made within the assembly.

It is thought that the move will give Mrs Hutt and her colleagues in the administration more clout.

News leaked

The official announcement at the Welsh Assembly on Thursday follows a decision in Scotland to scrap 43 health trusts there and replace them with 15 health boards.

In England, though, both health authorities and trusts remain in place.

This idea was originally scheduled to be made public on Friday, as part of a 10-year NHS plan.

But it was brought forward to Thursday's plenary session because the news had leaked out.

Public service unions are angry about the plan.

One leader told BBC Wales it was a step backwards to the days when Wales had one health board.

Dr Peter Ganesh of the NHS Alliance said Mrs Hutt had taken "a brave step".

But, he added: "With the abolition of the health authorities, the assembly must be very careful that re-structured local health groups don't end up as mini-health authorities with a different name.

"If we are really going to improve health care for the people of Wales, we must retain all the dynamism, enthusiasm,and drive that has characterised the LHGs over the past couple of years.

"Too much bureaucracy and top-down decision-making would destroy that."