Prescription costs in England will rise by 20p to £7.40 per item from April 1.

The increase will come as a blow to the British Medical Association (BMA) and other campaigners who wanted charges scrapped totally.

In addition, a rise in dental charges has been announced by the Department of Health.

The cost of an annual pre-payment certificate will remain at £104 but go up to £29.10 for a three-month certificate. Charges for elastic stockings and tights, wigs and fabric supports supplied by hospitals will also rise. However, the Department of Health said the government was investing an extra £10.7bn in the NHS and releasing £1.7bn by cutting bureaucracy.

The NHS in England nets more than £450 million a year from prescription charges.

Last year, the coalition shelved a report ordered by the previous government into how charges for patients could be reduced.

The study, from Professor Ian Gilmore, former president of the Royal College of Physicians, said the current system of charges was 'outdated and arbitrary' and all patients with long-term conditions lasting at least six months should be exempt for three years.

Patients could then return to their GP to have the exemption period renewed, and ministers should consider scrapping prescription charges altogether for everyone, the report said.

Department of Health