PM unveils plan to boost housing
David Cameron has unveiled plans to boost house-building and help council tenants buy their homes, which he said would help "fire up the engines of the British economy".
Mr Cameron's comments, at the start of the Conservative annual conference in Manchester, came amid growing signs of Tory unease at the sluggish pace of economic growth.
But the Prime Minister insisted he would not "tear up" his tight deficit-reduction plans, warning that even a few billion pounds of extra spending would put the UK's low interest rates at risk.
He also sought to rein in activists on Europe and tax cuts, stating that he would not support a referendum on Britain's membership of the EU and making clear that early reductions in tax are not a priority.
Meanwhile chancellor George Osborne announced new enterprise zones in Lancashire and East Yorkshire to help deal with the impact of defence giant BAE Systems' plans to slash almost 3000 jobs.
The Tory faithful were greeted in Manchester by a TUC-organised march against cuts, which brought about 30,000 vocal but peaceful protesters onto the streets of the city. Protesters snaking around the Manchester Central conference centre could be heard chanting: "David Cameron on your bike, we want a general strike."
But Foreign Secretary William Hague sent them a message from the conference platform: "The money you were promised by the last Labour government never existed, it was never there, and we have been left with the task of telling you the truth.
"A government betrays instead of serving its people if it allows them to live on a delusion and that we will not do. And it is wrong, unfair and irresponsible to leave a massive debt for the next generation to deal with instead of facing up to it now."
The party leadership faced a challenge to its economic strategy, as the four-day gathering began, from senior Tory backbencher Andrew Tyrie, the chair of the Commons Treasury Committee, who warned the coalition lacked a "coherent and credible" plan for growth.
But Mr Cameron rejected the charge, telling BBC1's Andrew Marr Show: "We are firing up the engines of the British economy. "There is a step change taking place right now. This Government is not just sitting back."