Reforming the NHS is the only way to maintain frontline health services amid the mounting debt crisis, according to shadow chancellor George Osborne.

He told the BBC Today programme: “We have a choice: we can either reform the way public services are delivered, so that the money goes further and you get more for less; or you can face frontline service cuts.

“It is the Conservatives … who are thinking seriously about how you change the way you deliver public services so that they can improve the quality of service delivery even in a period of budget restraint.”

He said countries like Sweden and the US have shown that reform “can improve dramatically … the quality of healthcare our patients receive, even in a period of budget restraint”.

He said that independent providers should be employed to drive down costs by bringing an end to the state monopoly of provision of core services.