NHS overhaul plans unveiled

Health Secretary Andrew Lansley has unveiled a proposal to radically shake up the NHS that aims to cut costs by £20bn by 2014.

The reorganisation will see England's 35,000 GPs taking a far greater role in commissioning services for their patients. They will be in control of £80bn of taxpayers' money and will need to form consortiums by 2013. There will be no opportunity to opt out of the system.

In turn, both strategic health authorities (SHAs) and primary care trusts (PCTs) would be phased out: 10 SHAs will be cut by 2012; 150 existing PCTs by 2013; and up to 30,000 management positions could be eliminated.

The government also announced plans to change the way the NHS reimburses pharmaceutical manufacturers, noting it will "move to a system of value-based pricing".

Lansley said the sweeping changes are to end the "old command and control" regime brought in by Labour. Chief executive of the King's Fund healthcare think-tank, Chris Ham, said: "It is a very radical programme. We have never seen anything like this since the inception of the NHS in 1948."

Shadow Health Secretary Andy Burnham accused Lansley of a "U-turn of epic proportions" by "ripping-up" the coalition agreement on the NHS. He said: "This reorganisation is the last thing the NHS needs just now. It needs stability not upheaval."

Lansley's white paper has sparked anger from unions and some doctors. Analysts have said it could herald the "denationalisation of healthcare services in England".

The plans only apply to England, where the NHS employs 1.3 million people. Although the NHS budget is protected, savings still need to be made to fund increasing demands from an ageing population and to pay for new treatments.

The full white paper is available on the Department of Health website: Equity and excellence: liberating the NHS