Michael White on NHS spending and the McKinsey report

“NHS [and overseas aid] will not escape cuts by ministers,” my trusted colleague Patrick Wintour reported on the front page of Monday’s Guardian. But don’t reach for a lethal dose of Paraquat yet.

My hunch is Labour’s strategy is to contrast masochistic Tory talk of deep, sweeping and urgent cuts with their own more measured approach

Health secretary Andy Burnham is still working on the assumption that “cuts” means less growth, not cuts in absolute terms.

To some extent the prime minister and chancellor are merely engaged in an election manoeuvre. Gordon Brown and Alistair Darling seek to wrong-foot the opposition’s David Cameron and George Osborne, who have ostentatiously ringfenced those two Whitehall budgets.

My hunch is Labour’s strategy is to contrast masochistic Tory talk of deep, sweeping and urgent cuts with their own more measured approach, one in which unavoidable cuts will be imposed only after the economy is safely growing again and driven by New Labour values. There will be no £20bn slash.

The chancellor used the V word in his Guardian article two weeks ago, in his Times interview last weekend, and again in a speech mid week. Behind it lies the implication that Darling - the man who kept his nerve and job - has persuaded Brown he must be more frank about hard choices ahead.

As Colonel Gaddafi can confirm the PM finds this difficult until events force candour on him. It might therefore be tempting to see HSJ’s big scoop - that leak of the McKinsey report raising the possibility of a 10 per cent cut in the NHS workforce - as part of a Baldrick-style cunning plan to soften up public opinion for something less drastic.

My research suggests cock-up rather than conspiracy. Andrew Lansley was quick to accuse ministers of “failing to be straight with the British people” while drawing up “secret plans” for the kind of cuts HSJ described.

“Only one fifth would be within the bureaucracy,” the shadow health secretary protested.

Mr Lansley’s statement prompted a sigh at the DH, reminding Mr Burnham of his youth as an adviser to shadow ministers before 1997. “I used to denounce secret plans too,” he admitted wistfully to colleagues.

In fact the leak caught Burnham and his deputy Mike O’Brien off guard. Both were vaguely aware a McKinsey analysis had been commissioned by then director general of commissioningMark Britnell and produced as long ago as March. But neither took it in their summer holiday reading bag.

O’Brien had to dash on to TV and radio largely unsighted to deny all. Ten days later there remains the message. Yes, big challenges lie ahead. No, there will be nothing so crude as a 10 per cent staff cut. Yes, greater efficiency and productivity are crucial now. No, there will be no blanket top-down edicts.

With all this in mind - and probably Unison’s wrath at this month’s TUC and Labour conferences too - Mr Burnham is sharpening his pencil to make a major policy speech next Thursday. He will use it to set out a direction of travel for the £100bn NHS budget, the basic parameters of future planning rather than a detailed route map.

You may murmur that Labour’s route map need not be very detailed because it is about to go over an election precipice. You may well be right, although ministers have regular injections of optimism. And when I read Lansley calling for bottom-up productivity and disparaging management consultants (as letters to the editor did all over Britain this week) I note minister Lansley would not be working from a totally different map.