George Osborne, the Shadow Chancellor, admitted last night that a Tory administration would have to cut other public services to fund increases for the health service.

However, he sought to calm a growing row within the Conservative Party over spending plans that was sparked by Andrew Lansley, the Shadow Health Secretary.

Mr Lansley told The Times that health spending was bound to rise as a proportion of gross domestic product (GDP). “We’re going to get probably to 11 [per cent] simply through the progress of rising health expenditure and life,” he said.

The Shadow Health Secretary denied that his words amounted to a pledge to fund the increase – equivalent to an extra £28 billion a year – insisting that he had been speaking about projections made by the Government’s own health adviser, Sir Derek Wanless. “I wasn’t talking about any projection for public spending and I wasn’t making any commitment beyond that which we have made, which is up to 2011,” he told the BBC Radio 4 programme World at One.

He repeated that health spending would have to rise in the decades to come under a Tory administration. “Even if we do succeed [in improving efficiency] we should not assume that that means we will not have a necessity for rising health expenditure – we will. And that is simply the product of an ageing population, rising technology and rising patient expectations,” he said.

It was Mr Lansley’s frank admission that funding health rises while meeting the Tory tax pledges meant that other public services would have to be cut in order to fund health rises, while meeting the Tory tax pledges, that caused most internal tension.

It is understood that the Shadow Health Secretary went beyond any formulation agreed in the Shadow Cabinet. There is already tension between Mr Osborne and Liam Fox, the Shadow Defence Secretary, over spending plans. A senior figure said that Mr Lansley had caused “deep anger” among some of his colleagues. Labour ministers sought to exploit the unease by writing to their Tory shadows asking whether they planned cuts.

The Conservative Party’s traditional supporters also reacted with dismay. Iain Dale, the leading Conservative grassroots commentator, said that he was astonished by Mr Lansley’s comments. He said that “competence, radical reform and efficiency” were far more important than cash increases in improving the NHS.

A contributor to The Spectator web-site said that Mr Lansley had “lobbed a firecracker” into the debate between traditionalists and modernisers. Fraser Nelson, the magazine’s political editor, wrote that Mr Lansley was “a major risk factor”. He said: “If he slips up like that during an election campaign, the Tories will be finished.”

In a speech yesterday the Shadow Chancellor confirmed that health increases would be funded by cuts elsewhere but said that the Government would have to do the same. “We have pledged to match Labour’s published health spending figures, which imply growth of 4.1 per cent a year for the next three years – NHS spending growing as a percentage of GDP,” Mr Osborne said.

“Some of that growth must come from efficiency savings and reductions in spending elsewhere – the plans that the Government has already published include absolute cuts in spending in several departments, including the Department for Work and Pensions and the Treasury.” Mr Osborne sought to allay fears over Mr Lansley’s remarks, emphasising that a Tory administration would get value for money from the NHS and seek to reduce its burden.

“Of course we need to improve public health and health productivity so that we reduce the long-term demands on Government and get real value for money from what we do spend,” he said. A spokesman for Alan Johnson, the Health Secretary, declined to comment on whether it was inevitable that health spending would have to rise in real terms. “Those decisions are made as part of the Comprehensive Spending Review,” the spokesman said.

In an interview with GMTV Mr Johnson denied that Mr Lansley had succeeded in “neutering” health as an electoral issue. He said that Mr Lansley and David Cameron were “genuine about [their] commitment to the health service” but that the Tories were divided on the issue.

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