The government is committed to a comprehensive programme of investment and reform for the NHS, Alan Milburn has told MPs.

Concluding the fourth day of Commons debates on the chancellor's NHS-focused Budget, the health secretary reiterated the government's promise to radically overhaul the structure of the health service in tandem with a massive increase in funding.

"Decades of neglect are being put right," Milburn told the Commons, promising that along with investment would come national standards, more devolution to the frontline and greater choice for patients.

Funded from a one per cent across the board increase in National Insurance contributions, NHS budgets are set for 7.4 per cent average annual real terms growth for each of the next five years.

This would take spending up to £72.1 billion in 2002/03, £87.2 billion in 2004/05 and then rising to £105.6 billion in 2007/08.

It would take NHS spending as a share of GDP from 7.7 per cent this year to 8.7 per cent in 2005/06 and 9.4 per cent in 2007/08.

The minister refuted claims that the massive injection of cash would fail because the NHS could not be reformed. The government's investment since 1997 was already beginning to show signs of progress.

"In the last year deaths from cancer have fallen by two per cent and deaths from heart disease have fallen by five per cent. Where do the members opposite think these improvements have come from? They do not come from the invisible hand of the free market," said Milburn.

A confident Milburn attacked the Opposition, saying the Conservatives were ready to reject the NHS but had not yet admitted it in public.

Milburn taunted the Conservatives for their plans to vote against the Budget.

"It simply won't be credible for members to stand up in this chamber, or in their constituencies, and ask for more resources if they are not prepared to pay for them."

There was also scorn for the Liberal Democrat plans for reforming the NHS.

"Frankly no one but a fool - and those on the Liberal benches, believe that a few years of extra money can put right the years of under-investment," he said. "We are both investing and reforming."

Conservative shadow health secretary Dr Liam Fox claimed that by raising taxes just hours after the Wanless report the chancellor had precluded any debate over the different systems for funding health.

"The chancellor would like to have us believe there is a simple choice between this or US-style insurance. That is a completely bogus argument," said Fox. "They've already been in office for five years and their record is nothing to shout about."

The NHS agenda

Words of caution on the reform process have also come from the government's own adviser on the future of healthcare in Britain.

Ahead of the Budget, Derek Wanless, the former chief executive of NatWest, conducted a Treasury-sponsored review of NHS funding over the next 20 years.

His report raises two issues that should concern ministers.

The Wanless Report called for NHS funding to rise to between £96 and £97 billion by 2007/08, around £8 billion less than the sums actually committed to the health budget by the chancellor.

Wanless warned that even the sums he was recommending were at the higher end of what NHS managers and staff could reasonably spend effectively. Increasing funds too quickly could hit capacity constraints, he said.

Government figures indicate the risks of increasing spending without expanding capacity. Last year there was a £500 million under spend in the Department of Health's budget.

And while Wanless accepted the need for the increased discretion at a local level, he also cautioned ministers on the need to "avoid disruptive change", saying that with one reform programme already underway, it was a "persuasive view" that there should be no further upheavals.

But with over a million employees working in the NHS, ministers are committed to a change not just in the structure of the NHS, but also in its culture and working practices.

Delivering on the reform agenda will be a huge task for ministers who have staked their credibility on improving standards of healthcare.

"Investment plus reform equals results. We will be happy to be judged on them," says the health secretary.

And that's one point of agreement between Labour and the Conservatives.

"This government will live or die depending on its ability to deliver on its health promises," said the shadow secretary of state for health, Dr Liam Fox.

"The Conservative Party will ensure that these promises are rigorously monitored on route. This is to ensure that taxpayers are not being hoodwinked. Most importantly, if the government fails to achieve meaningful reform there will be a life and death struggle for far too many of our fellow citizens."