Cameron accused of breaking pledge on NHS

In their manifesto, the Tories promised to increase health spending every year. Photograph: Christopher Furlong/Getty

David Cameron was accused of breaking his biggest pledge at the general election – a guarantee that health spending will increase every year in real terms – after Treasury figures showed a fall in spending in the coalition's first year in government.

Labour accused the government of burying figures in a Treasury document which show that spending on the NHS was cut in real terms to ?101.9bn in the coalition's first year in office from ?102.7bn in Labour's last year in government.

John Healey, the shadow health secretary, said: "David Cameron has broken his NHS pledge. He put up posters pledging to cut the deficit, not the NHS, but we see now that the Tory-led government has already cut spending on the NHS in its first year.

"On top of this cut, Cameron's reckless NHS reorganisation is set to cost ?2bn, money which could be better spent treating patients. And there are more cuts forecast in future years. This proves again what people have seen before: that you can't trust the Tories with the NHS."

Labour criticised the government after figures in the Treasury's Public Expenditure Statistical Analyses (PESA) for this month showed a cut in NHS spending in real terms from ?102.7bn in 2009-10 to ?101.9bn in 2010-11. The Tories opened their NHS section in their general election manifesto with the words: "We will back the NHS. We will increase health spending every year."

In a question and answer session on 14 June the prime minister said: "I want to make this clear, you know we are not cutting spending on the NHS, we are increasing spending on the NHS. This government took a very big decision, given that the NHS is one of the biggest budgets there is in the country, we took a decision to increase by more than inflation in each year NHS spending."

The Institute for Fiscal Studies gave a cautious endorsement of the Labour interpretation of the figures. It said that "NHS (Health)" spending had increased in cash terms but had fallen, or at the very least been frozen, in real terms.

Rowena Crawford, of the IFS, said: "In reality whether the NHS gets plus 0.0% or minus 0.0% growth in a year makes very little real difference. While one 'breaks the pledge' and the other doesn't, the NHS still essentially faces a real freeze in its budget which it will find very constraining given increases in demand for healthcare and the large real increases in spending it has enjoyed for the past decade or so."

George Osborne hit back last night. He said that the year identified by Healey as the coalition's first year in office – 2010-11 – was in fact the final year of Labour's 2007 spending review.

The chancellor said that he had decided to stick to the Labour plan because he came to office just over a month into the 2010-11 financial year. In his first spending review, outlined in November last year, Osborne said that health spending would increase every year from April 2011.

Osborne said: "This is a massive own goal from Labour – attacking their own NHS spending plans. Under Labour spending plans, NHS spending fell, under this government's spending plans it is projected to rise – people can draw their own conclusions about who they trust on the NHS."

Labour hopes that the apparent breach of the Tories' election pledge will put further pressure on the government, which was forced to pause its NHS changes in the spring. But the IFS said it was not surprised by the fall.

Crawford said: "That NHS spending may be lower than it was last year in real terms I'm not sure is particularly surprising. I think the Treasury have previously indicated that they were expecting an NHS underspend in 2010-11."

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