NHS funding and reform are in the headlines today after two reports criticised Labour's health strategy.

The Audit Commission warned that progress may not last in the long-term as a "targets culture" could affect clinical decision making.

James Strachan, the watchdog's chairman, said: "There are too many piecemeal targets and the pressure put on waiting-time targets has led to a tremendous amount of distortion of the system. Having too many targets risks obscuring where the real priorities lie."

The report also warned that some hospitals being groomed to achieve foundation status will not be able to manage outside Whitehall control.

Meanwhile, the Office of National Statistics found that while resources rose by six per cent in real terms in 2001, treatments to patients rose by only three per cent.

Michael Howard, the shadow chancellor, said: "This raises questions about the value people are getting and they will expect answers."