Exclusive: Ed Miliband vetoes Andy Burnham's plot to hand NHS cash to councils

Shadow Health Secretary Andy Burnham NHS proposals have been vetoed by Labour leader Ed Miliband (Charlie Forgham-Bailey/The Independent)

Ed Miliband is to veto a policy by his shadow Health Secretary Andy Burnham to hand over control of billions of pounds of NHS funding to local councils, The Independent has learnt.

Mr Burnham outlined proposals last year that would have committed a future Labour government to transfer around £60 billion of NHS money to local authorities to create an integrated health and social-care budget.

The move would have radically reshaped the NHS and healthcare in England – with elected politicians rather than doctors having the final say on where money was spent.

But The Independent understands the proposals have been rejected by the Labour leader and the shadow Chancellor, Ed Balls. Both men believe that the policy is misguided and would allow the Tories to accuse Labour of imposing another top-down reorganisation in England. Labour will still attempt to integrate health and social-care budgets to provide “whole person care”, but funding is likely to remain within the NHS.

Behind the scenes there is unhappiness at senior levels in the party, and among those close to Mr Miliband, over what is seen to be Mr Burnham’s “opportunistic” use of the shadow Health brief to place himself as a future leader.

They privately accuse him of running a “freelance” operation and trying to curry favour both with local Labour councillors, who are keen to get control of the NHS budget, and the unions, who oppose outsourcing of NHS services, at the expense of creating a sustainable and affordable healthcare system.

“We all remember when Andy was Health Secretary and happily contracting out bits of the NHS to the private sector,” said one Shadow Cabinet minister. “You have to ask yourself what’s changed.”

They point to Mr Burnham’s support for private independent treatment centres funded by the NHS when he was Health minister. At the time, he said, “... the old way in the NHS has been, well, like it or lump it, this is what you’re getting. We are at last putting patients in control and creating a health service where care is provided to their convenience and not the health provider’s.”

However, last month, in an interview with The Independent as shadow Health Secretary, he said the Government wanted to say: “These services aren’t good enough, it’s failing the public, we need any qualified provider ... we need other people to come in and replace this failing, uncaring NHS.” And he added: “There is a political agenda and an ideological agenda underpinning what they are doing.”

Internal party critics say Mr Burnham appears to be positioning himself as a candidate to replace Mr Miliband should Labour lose the general election next year. “It’s perfectly clear what he’s doing,” said one senior source.

Some in the party also saw Mr Burnham’s public opposition to HS2 this week, in defiance of the party leadership, as another sign that he was trying to differentiate himself from Mr Miliband. “I’ve given no guarantees about supporting it,” he said, before suggesting he spoke as a constituency MP.

He was rapidly slapped down by the leadership on this issue too. “Andy Burnham supports Labour’s collective position supporting HS2,” said a party spokesman, pointedly.

Labour’s election health policy is due to be unveiled in the coming months after the publication of Sir John Oldham’s report on integrated care.

A spokesman for Mr Miliband said he was “four-square behind Andy’s vision of an integrated health and care service, fit for the 21st century”.

But, tellingly, the spokesman did not commit Mr Miliband to supporting Mr Burnham’s plan to give councils control of NHS budgets. “We have set up the Independent Commission on Whole Person Care... to look at how the next Labour government will deliver this vision... we look forward to seeing its final report.”