Gordon Brown promised to abolish prescription charges for cancer patients as part of a 'new settlement' focusing on fairness.

In what had been described before he spoke as the speech of his life, the prime minister's announcement that he would scrap the charges for cancer patients from April was well received in the conference hall.

Patients' organisations have welcomed Mr Brown's additional pledge that "over the next few years" the charges would be dropped for all patients with a long term condition.

The section of Mr Brown's speech that focused on health and the NHS earned him two standing ovations as he was talking. He pledged always to support the health service, saying: "For me, this isn't a political agenda but a personal mission."

The government expects around 250,000 cancer patients to be exempted from prescription charges from next year. It will cost around£20m a year, which has been "factored into health budgets", according to a government source.

Costs and savings

The cost of abolishing prescription charges for all patients with long-term conditions would be about£250m a year, which will be paid for from the savings on drugs as a result of the deal on the prescription price regulation scheme.

The exemption is likely to be linked to an expectation that patients would discuss the establishment of a long-term care plan with their doctor. The care plans were part of the prime minister's vision of a more personal health service.

Mr Brown said he wanted Britain "to lead the world" in beating diseases such as cancer and Alzheimer's. He said major breakthroughs in research were not being turned into treatments.

Health secretary Alan Johnson was due to speak yesterday, and was expected to encourage the health service to be more outward-looking, particularly working more closely with schools.

There was considerable speculation that in the event of a Cabinet reshuffle Ed Miliband would replace Mr Johnson as health secretary. In a rallying speech, Mr Miliband stressed the importance of getting health policy right.

Other names being touted include James Purnell and Jacqui Smith.

HOW THE PRIME MINISTER'S SPEECH WAS RECEIVED

Lord Darzi, health minister "It was a fantastic acknowledgement of what we've done [in the NHS] and a commitment to keep up the momentum. The emphasis on fairness within a challenging global economic environment is very important."

Anna Walker, chief executive, Healthcare Commission "I thought it was a good panoramic sweep, both of internal issues and things that matter to people, like fairness and the NHS (which got one of the biggest rounds of applause on prescription), but at the same time looked internationally. And he gave a sense of really understanding the financial issues the world is facing.

Derek Simpson, joint general secretary, Unite "The Tory answer would be to slash and burn. What he's done in this speech is show the wide gap between the approach of Labour and what the Tories would do, and that answers the question that there's no difference between the two parties."

Imelda Redmond, chief executive, Carers UK "We are very pleased to see social care has suddenly come up the agenda."

Paul Farmer, chief executive, Mind "We look forward to the care plans for all with a long-term condition, which will include many with a mental health condition. And the commitment on prescription charges, which is something we've been waiting for a long time."

Doug Naysmith MP, health select committee member "It was a tour de force and he faced up to a lot of the problems the party has, and continued his great commitment to the NHS. He was making it quite clear that if there is to be a diminution of public funding, it won't be in the NHS. Cancer patients losing their prescription charges is a good thing; the anomalies in that have been totally ridiculous."