At a session of the House of Commons select committee on science and technology, the professional standards director of Boots, Paul Bennett, had a remarkable admission to make about one of his company's key products, its range of homeopathic medicines.

"I have no evidence before me to suggest they are efficacious," he acknowledged. "And we look very much for the evidence to support that. It is about consumer choice for us."

And you can see why. Millions of people believe they are cures for most of life's woes, from headaches to eczema. Prince Charles even claims one helped him get over the effects of his recent broken arm. But now the efficacy of homeopathic drugs is under attack – from MPs who believe their effects are unproven and that their use is a waste of taxpayers' money. They are pressing to ensure that the National Health Service no longer spends an estimated £4m on homeopathic treatments.

Last year the select committee began hearing evidence about the use of homeopathy in the NHS and will finalise the wording of its report on the subject tomorrow. The report will be published the following week – and is likely to call for a complete reappraisal of the role of homeopathy in the health service.

The chair, Phil Willis, the Liberal Democrat MP, told the Observer that his committee was set up to look across government and pose the question: where is the evidence to support policies?

"So we asked the Department of Health what is its policy towards homeopathy and, second, what is the evidence behind spending money from the NHS on it," said Willis. "We found it very hard to find any evidence to support the efficacy of homeopathic remedies."

This point was supported by another Lib Dem committee member, Dr Evan Harris. "You cannot justify spending money on non-efficacious, ineffective and non-cost-effective treatments whether or not they are popular with Prince Charles at a time when the NHS cannot afford to fund treatments, for example for certain cancers, that are known to be effective."

The select committee meeting tomorrow will follow yesterday's protests by sceptics who staged a mass "overdose" of homeopathic remedies to show the medicines are worthless. Campaigners – who want Boots to withdraw all homeopathic treatments from its shelves – met outside branches of the high street chain in Liverpool, Manchester, Glasgow, Edinburgh, London, Bristol, Leicester and Birmingham.

It is more than 200 years since homeopathy was devised by Samuel Hahnemann, a German doctor. He believed that a substance that caused symptoms in a healthy person could also be used to cure the same symptoms in someone who was ill. In other words, he argued that "like cures like". For example, extracts of coffee could be used to treat someone with insomnia.

But there is an added twist to this unusual approach to treating illness. Homeopathic medicines are diluted to incredible levels so that there is little chance there will be a single molecule of their ingredient left in a bottle. Somehow the water used for this dilution retains a memory of the original drug, it is argued. This memory creates the medicine.

It sounds unlikely. Nevertheless homeopathy is big business today. In Europe the market has grown 60% in a decade while in Britain remedies have spread far beyond shops that specialise in natural medicine. Bottles of homeopathic remedies line the shelves of pharmacies in a market that will be worth an estimated £46m a year by 2012.

In the UK, there are now five NHS homeopathic hospitals and some GP practices also offer homeopathic treatment. And it is this support, through the NHS, that angers many politicians and scientists, including Britain's first professor of complementary medicine, Edzard Ernst of Exeter University.

Ernst, a former professor of rehabilitation medicine in Vienna, took up his present post to bring scientific rigour to the study of alternative medicines. "I once worked in a homeopathic hospital and was initially sympathetic to its claims. I got into rows with doctors and scientists over my views."

Then Ernst started carrying out trials that included one involving the study of arnica, given as a standard homeopathic treatment for bruising. "We arranged for patients after surgery to be given arnica or a placebo," he said. "They didn't know which they were getting. It made no difference. They got better at the same rate, whether they got arnica or the placebo. And arnica is a classic homeopathic ­remedy. It doesn't work, however."

Similarly, studies of how homeopaths treat children with asthma again found no evidence their medicines worked. "I have now published more than 100 papers on homeopathy and I am quite clear about its efficacy: you may as well take a glass of water than a homeopathic medicine," said Ernst.

And it is this failure to demonstrate efficacy, as far as mainstream scientists are concerned, that has alarmed members of the science select committee. All new medicines have to prove their efficacy and cost-effectivenes to the National Institute for Clinical Excellence (Nice) before they can be used by the NHS. Yet homeopathic medicines get funding despite the fact that they do not meet this criterion.

"There is no scientific basis for their being effective," Professor Jayne Lawrence, of the Royal Pharmaceutical Society of Great Britain, told the select committee. "There is no reason why they should be effective scientifically."

This point was backed by Evan Harris. "Nice has never looked, or has been asked to look, at the use of homeopathy, a treatment for which every proper medical authority agrees there is no evidence of effectiveness. Why has the government not asked them to do that? Has it vetoed them from doing this?"

Some supporters argue that, even if homeopathic medicines only generate results through the placebo effect, this still justifies their use within the NHS. Such drugs do no harm and, although their scientific underpinning is ridiculed by researchers, they are occasionally associated with positive outcomes. More to the point, there is a popular demand for homeopathic medicines. Should this desire not be met by the NHS, they ask?

This idea was strongly attacked during the committee's sessions, however. Asked by Willis if she thought homeopathic medicines could be justified simply on the grounds they were harmless and popular, Tracy Brown, managing director of the group Sense about Science, gave a forceful reply.

"If you think about the rows around things like the prescription of Alz­heimer's drugs on the NHS, you are expecting people to look at the evidence to understand why certain drugs are available for people with a condition and certain are not. Then you throw the evidence up in the air and say that if people want it [a homeopathic medicine], they should have it. We just lose, as a society, the dividing line, the ability to talk to people about the evidence behind their medicines. I think that is a serious public health issue." This point was backed by Ernst. "Some people say the money spent on homeopathic medicines by the NHS is small fry, but for me it is a matter of principle. If the NHS adheres to evidence-based principles, it cannot go ahead and let homeopaths do what they like."

In his interview Willis, who would not comment on what the final draft of his committee's report might say, added that the evidence from Paul Bennett of Boots had also been "very telling". Ernst agreed, describing his statement as remarkable. "The spokesman for Boots admitted there is no evidence that these medicines work, yet they are selling them. Pharmacists are supposed to be healthcare professionals, not just shopkeepers."

For their part, homeopathy proponents have slammed the MPs' inquiry. Cristal Sumner, chief executive of the British Homeopathic Association, said the committee had been biased in its approach and review. "Homeopathy helps patients and is not a placebo effect, and the government backs patient choice and the ability to have homeopathy on the NHS." She referred to comments by the health minister, Mike O'Brien, who said it would be "illiberal" to consider withdrawing services to patients. "Those doctors I work with in integrating homeopathy in NHS practice see it helping patients every day, and that is why they offer it," added Sumner.

Homeopathy absorbed a tiny fraction of the NHS budget, she said. "One must ask the committee, will patients then be forced to take conventional medicine at a higher cost?"

Sumner also pointed to evidence in the British Medical Journal that said adverse drug reactions in 2004 cost around £466m per year; and more than a quarter of a million patients were admitted to hospital in the UK because of harmful effects after taking drugs.

"However, far more worrying is the broader question of who should be in control of healthcare and deciding what we and our loved ones should be able to receive. Should it be a committee of MPs, or should it be we ourselves?"

Others point out that the NHS spends money on other areas without a rigorous scientific backing. For example, it spends millions of pounds on chaplains to ensure patients have a right to religious observance. Others have complained that the ratio of witnesses called to appear in front of the committee was unbalanced, with too many sceptics and too few supporters taking part.

What is clear is that homeopathy arouses strong feelings. And while many of the MPs on the committee will come to tomorrow's meeting hoping to agree a powerful report condemning the fact it is funded by the NHS, not every member of the committee feels that way. At the very least there will be a lively debate with a number of amendments tabled.

"The scrutiny function of the committee is ongoing," said Ian Stewart, a Labour MP on the committee. "There will be a draft report, we will discuss it, and then a decision will be made on whether the report can be unanimously accepted or not."