Published: 05/12/2002, Volume112 No. 5834 Page 16

When one of my hard-bitten Westminster colleagues spotted Alan Milburn on the screen giving his umpteenth 'two points'TV interview after the Agenda for Change deal she murmered, 'There is a man getting into his stride.'

Indeed, the secretary of state sounded articulate and confident. He has been on a sharp growth curb these past couple of years and is close to becoming one of those few members of any Cabinet who is deemed to wear political long trousers, a big player whose views matter.

This is not all good news for Mr Milburn or for the NHS. The bigger the stakes, the harder the fall, and not all the NHS unions emerged from the four-year negotiation full of cheer.

They have yet to ballot their members, and the provisionally agreed changes do not come widely into force until late 2004. The devil is in the detail and (no reckless Ken Clarke-style reform this time) is subject to 12 pilot schemes.

In other words, There is many a slip, and Mr Milburn's star could slip with them.

I had the same feeling about Gordon Brown's April budget.Was it the start of a new, glorious phase or the pinnacle of a career which might now falter?

Mr Milburn's announcement was instantly mixed up with the events of the moment, the firefighters' dispute and the pre-Budget report which was known as the autumn statement on public expenditure when I was a lad.

The latter saw Mr Brown (sort of ) admit to excess optimism about economic growth - for once his critics were right - and therefore to the need to borrow£20bn ('peanuts' said his aides) to keep his spending plans on track.

So far so good. This column has argued before that the late, great JM Keynes would have approved extra state spending when the economy is faltering rather than when it was booming in 1997-98. It may have been luck, but the timing is good and the conservative newspapers who condemned him do not yet have a better idea - except cuts - though Michael Howard, the shadow chancellor, was in impressive form at Westminster. He actually dented Iron Gordon's armour plating.

Of course, Mr Brown's pre-Budget report statement contained a stern lecture on the need to resist inflationary pay deals which will undermine his 'invest and reform' strategy for the NHS, schools and the other major public services.Hence Mr Milburn's 'two point'message on Channel 4 News which my colleague so admired.

It proves negotiation works, he told the viewers.The Agenda for Change deal also proves that extra pay can be found in return for modernisation, the Blair-Brown mantra which requires public sector workers to embrace flexible working practices in return for more dosh.

How much more dosh? Well, I took a call from a senior official at the GMB union the following morning and he was talking enthusiastically about 10 per cent over three years, lots more for some of his low-paid members.

The Times spoke of 21 per cent for some as doctors' prescribing duties are passed down to nurses, nurses' duties to support staff and so on. Health officials more cautiously suggested a 12.5 per cent rise in the total NHS wage bill (currently£18.4bn for 1.2 million staff) over three years, 15.9 per cent over five.

There will be losers as well as winners.

Health policy officials at Number 10 have been eager for this deal, so that pay comes to depend on flexibility and skills at the workface, not on automatic grades and pay rises.

Despite The Daily Telegraph editorial's headline, 'Milburn's quiet revolution', it took the wary line that NHS productivity is failing to respond to the chancellor's cash transfusion, a 'lumbering giant' that cannot adapt fast enough. We shall see.

Inevitably, Mr Milburn tried to win brownie points with Mr Blair by linking his success to the Fire Brigades Union dispute. But unions and the no-strike Royal College of Nursing were quick to say that the two cases are entirely different. 'The NHS is talking of expanding its staff, the government is threatening to contract the fire service, ' said one official.

Even the RCN's Dr Beverley Malone, a Clintonite moderate in politics, managed to voice 'warm support' for the FBU's right to press its case. You see, she's learning too. l