David Cameron stakes all on balancing Britain's books

By James Chapman
Last updated at 12:45 AM on 22nd August 2009

'Make or break': David Cameron set his own test of success in office

The battle to balance the public finances will 'make or break' a Conservative government, David Cameron said yesterday.

In an unusual move for an Opposition leader, Mr Cameron set his own test of success in office, saying that reining in an unprecedented peacetime budget deficit would be his defining struggle.

Labour plans to more than double the national debt to £ 1.4trillion in the next five years, a move that critics warn could lead to a catastrophic boycott of the UK by overseas investors.

Borrowing is forecast to be far higher than it was when Britain was forced to go cap-in-hand to the International Monetary Fund for a loan in 1976.

This week it emerged that Government debt has already passed £800billion, and the Treasury was forced to borrow a record £ 8billion last month to continue spending on public services.

The Treasury will have to pay interest of more than £40billion on its debts by next year.

Experts are shocked by how badly the public finances are deteriorating as tax revenues collapse in the recession.

Yesterday Mr Cameron made clear that spending cuts would be at the heart of his government's aim to get Britain back into the black.

Apparently confident of victory at the next election, he told the Economist magazine: 'Getting the deficit under control will make or break my government. I can't think of an opposition party going into an election promising spending cuts since 1929.'

Mr Cameron admitted that he regrets his pledge to stick to Labour's spending plans.

The commitment was abandoned late last year and the party is now making clear that it is determined to find savings.

Senior Tories fear that unless they persuade voters now of the need to get Britain back into the black, they will become unpopular as they cut spending in government.

Mr Cameron made clear for the first time that more detailed plans will be set out by the Tories before the election.

City experts say deep spending cuts and tax rises are inevitable whoever wins the election.

Chancellor Alistair Darling attacked Mr Cameron's ' irresponsible' warning this week of the problems facing Britain because of its debts.

The Tory leader said borrowing was now so high there was a danger that overseas investors could 'cease to lend' to the Government or demand higher premiums.

But he said that he was not predicting a default on the debt.

In yesterday's interview, Mr Cameron sought to further distance the Tories from the row caused by Euro MP Daniel Hannan's attack on the NHS.

The Tory leader insisted that he was committed to the service and his view was 'the one that counts'.

But Mr Cameron faced more criticism from former Tory minister Ann Widdecombe.

She told Total Politics magazine that women and ethnic candidates were not being selected on merit and accused Mr Cameron of 'blindly' following warnings about global warming.

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