The worst-performing hospitals must be dismantled, merged and even closed if the NHS is to improve care and address the way that the health budget is spent, the nurses’ leader has warned.

Peter Carter, of the Royal College of Nursing, said that ministers must make brave decisions and stop the political self-interest that is hampering essential change to the way that healthcare is delivered. He added that it was time to end the political taboo of hospital closures and have proper public debate about why the NHS was geared too much around hospital care.

“In our metropolitan areas we have far too many acute hospitals. That’s a drain on the system and it has got to change,” Dr Carter, head of the union representing 400,000 nurses, told a private meeting of the think-tank Reform this week.

“People are going to have to be brave to make these decisions. Some of those hospitals that we have known and loved, and which were performing appropriately in their day, are no longer appropriate.”

Dr Carter described the concept of the closure of some hospitals or departments that carried chronic debts as a really difficult agenda, given the likelihood of heavy political interference from ministers and local MPs who invariably campaign against it.

He said that the public and political understanding of NHS reconfiguration had been badly damaged by quick-fix closures in recent years to address cash issues, adding: “People have tinkered around the edges and not made the paradigm shift that’s required.”

More than two thirds of the £100 billion NHS budget is spent on long-term conditions that are increasingly being treated out of hospitals, which remain the most expensive part of the health service.

Dr Carter’s comments come amid growing concern about the political failure to explain the need to address the excessive dominance of hospitals in the NHS. Andrew Lansley, on becoming Health Secretary in May last year after an election where the Conservatives fought repeatedly against NHS reconfiguration, called a moratorium on all “top-down, forced” hospital changes. He has now set a series of tests for change, which must be decided by local people.

Dr Carter’s calls for a change in the delivery of care and greater effort to explain this to the public were echoed yesterday by Sir Stephen Bubb, one of the members of the panel that reviewed the Government’s reform plans.

“We have too many hospitals and we need to think about how we go about closing them. We all recognise how very difficult it is for the system to do this, but if we want to change we have to,” he said, during an appearance before the Commons Health Select Committee.

Sir Stephen later said of the Government’s position: “The head gets it, but the heart finds it very difficult. If the heart rules, it is not going to be to the long-term benefit of the health service.”

Julie Moore, the chief executive of Birmingham NHS Foundation Trust and another member of the expert panel, said that the balance was wrong at the moment. “We all need to work together to work it out,” she added.

The debate about the future shape of the NHS comes after the Government endured months of embarrassment over its plans to reform the health service. It was confirmed this week that the Government would scale back on many of its boldest ideas to introduce competition as the NHS struggles to match limited funding with ever increasing demand, Alan Milburn, the former Labour Health Secretary now working for the coalition as a social mobility adviser, described the watered-down reforms as “the biggest car crash in NHS history”. He gave warning that any hope of meaningful reform had been lost for a generation because of the temptation to elevate short-term politics above long-term policy.

Professor Chris Ham, the chief executive of the King’s Fund health think-tank, said that the debate over hospitals was essential, and it was the nettle that the Government had to be brave enough to grasp. “Too many hospitals are duplicating each other, are not providing the right care, and in some cases are frankly compromising safety. For too long politicians have not been willing to show the leadership that the health service needs.”

Professor Ham added that the mounting financial pressures now made that task much more urgent.

A Department of Health spokesman said that the Government did not foresee any hospital closures. “We have made clear that any service changes must be locally led and consulted on,” he added. “They must also be subject to the four tests set out by the Health Secretary, based on clinical and patient support.”