Thousands of doctors trained outside Europe yesterday won a House of Lords ruling that the Government could not block them from applying for training posts in Britain.

By a four to one majority, the law lords ruled that guidance originally issued by Patricia Hewitt when she was Health Secretary, aimed at limiting the employment rights of overseas doctors, was illegal. She had issued instructions saying that doctors from outside Europe should be appointed to training posts only if there were no suitable candidates from Britain or the EU to fill them.

By “dashing the legitimate expectations” of doctors who had been encouraged to come to Britain, the law lords said, Ms Hewitt had acted unfairly.

The ruling ends a long legal battle. Her guidance was challenged by the British Association of Physicians of Indian Origin (Bapio), which lost in the lower court but won on appeal. The department brought a further appeal to the Lords, which it has now lost, bringing final victory to Bapio.

The ruling will mean 4,000 to 5,000 overseas-trained doctors already in Britain are guaranteed equal chances of winning training posts.

A Department of Health spokesper-son said: “We are disappointed that the Lords have ruled that our guidance as it stood was unlawful. However, this is a complex judgment which needs careful consideration.

“We are coming to the end of a consultation on this difficult issue. That consultation is due to end on May 6. We need to study the House of Lords findings carefully, alongside the responses to the consultation, to see what the best course of action will be.”

Although the department lost, the ruling does not mean an ever-open door. The Home Office has changed the rules for immigration to prevent people coming to Britain under the Highly Skilled Migrants Programme (HSMP) from applying for medical training posts.

Bapio’s victory does mean that applications for training posts in the next few years will remain tight, with roughly 700 to 1,000 British-trained doctors likely to be unable to get a training post in 2009, 2010 and beyond.

For this year, the ruling would have had no effect even if the department had won. Competition for training posts in 2008 is likely to be even tougher than in 2007, with about three applicants for every place.

In 2007 more than 1,300 applicants from British medical schools failed to get posts. This year the department estimates that between 1,000 and 1,500 will be disappointed. They will still be able to get jobs in the NHS, but training posts are much more desirable because they lead eventually to qualification for consultant posts.

The issue now is what the department will do to solve the problem. Medical school places have been steadily increasing, leaving the prospect of many expensively trained British graduates being denied the opportunities they hoped for.

One alternative is to increase the number of training places, but that would be pointless if there were not a corresponding increase in consultant jobs. It would be moving the point of unemployment to later in a doctor’s career. Another alternative would be to cut the number of medical school places, reversing the policy of self-suffi-ciency embraced by the Government. But this would take up to ten years, represent a volte-face and would return Britain to its traditional position of dependence on foreign doctors.

In the Lords ruling, Lord Rodger of Earlsferry said that it must have been clear to the Government that, due to a change which it had itself initiated soon after taking office, from about 2005 there would be an increased supply of home-grown medical graduates. To try to put it right, Ms Hewitt “dashed the legitimate expectations which it had fostered and on which the foreign doctors had acted. The advice was accordingly unlawful.

“Obviously, the Government could have achieved its objective if it had amended the immigration rules. For various reasons, it chose not to do so.

“But, if it had chosen to try to amend the rules, it would have been required to pay the political price of subjecting the proposed change, and its highly damaging effects on the international medical graduates with HSMP status in this country, to the scrutiny of Parliament.”

Lord Bingham of Cornhill said that to speak of the guidance being “issued” was to “suggest a degree of official formality which was notably lacking”. It was published on the NHS employers’ website, but no official record had been produced during the legal proceedings. Instead, the Lords had been referred to a Home Office e-mail. “It is for others to judge whether this is a satisfactory way of publishing important governmental decisions with a direct effect on people’s lives,” Lord Bingham said.

Lords Carswell and Mance also dismissed the Government’s appeal.

In a dissenting judgment, Lord Scott of Foscote said that the Health Secretary was entitled to adjust the policy on employment of junior doctors in postgraduate training positions to give priority to British or EU nationals.

Terry John, chairman of the BMA’s International Committee, said: “It’s right that we have a debate about the numbers of doctors coming to the UK in future, but it’s wrong to scapegoat those already here.”

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