David Cameron has been urged to abandon the Government's controversial Health and Social Care Bill by at least one senior Cabinet minister in the face of widespread public hostility.

Senior figures in Downing Street and the Conservative whips' office have also suggested to the Prime Minister that the Bill, which last night suffered its first defeat in the House of Lords, should be dropped.

The Government was defeated by 244 to 240 on an amendment to emphasise the importance of mental health in the Bill. The amendment had been rejected by the Government.

Senior Government figures have made the case to Mr Cameron that many of the changes to the health service could be carried out without legislation. They also told him they feared "pushing" the Bill through against widespread opposition would give Labour an "open goal" to blame all future problems in the NHS on their reforms. The concern was apparently backed up by private polling that shows the reforms are deeply unpopular.

The Treasury is also concerned that the reorganisation could increase health-service costs during the transition to the new system of GP commissioning. But others within No 10, including Mr Cameron's director of strategy and close aide, Steve Hilton, argue it is too late to withdraw the Bill now and the only way cost savings can be made within the NHS is to introduce greater competition.

Mr Cameron is so far backing his Health Secretary, Andrew Lansley, dismissing suggestions that he might sack him while mounting a spirited defence of the reforms.

Mr Cameron, whose disabled son Ivan died in 2009, said the shake-up was essential to ensure everyone received the "amazing" care that his family had.

But Ed Miliband called on Mr Cameron to drop the Bill. "This is a matter of trust in the Prime Minister," Mr Miliband told MPs. "Can he honestly look people in the health service in the eye and say he's kept his promise of no more top-down reorganisation?"

In another difficult day for the Government, fresh opposition to the Bill came from within the Government's own supporters. The official blog of the Tory Reform Group called on Mr Lansley to "retire to the back benches and take his Bill with him".

And more health organisations demanded withdrawal of the Bill, including the Institute of Healthcare Management (IHSM) and the Faculty of Public Health. Sue Hodgetts, chief executive of the IHSM, representing 4,000 NHS managers, said it had hardened its stance because the Government had shown "total disregard for the advice we gave". She said: "We can confidently say health and social-care managers do not support this Bill."

The Faculty of Public Health warned that the Bill would "damage the NHS and the health of people in England" after an online survey that drew almost 1,300 responses from its 3,300 members found three-quarters of them wanted the Bill abandoned.

Its president, Lindsay Davies, said: "It has become increasingly clear that the Bill will lead to a disorganised NHS with increased health inequalities, more bureaucracy and wasted public funds."

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