UK 'in debt for ever' under Labour
Labour's economic plan is a "massive gamble" that would leave Britain vulnerable to a repeat of the 2008 crisis, David Cameron will claim today.
The Prime Minister said the Opposition intended to add to the nation's debt "every year for ever" as he defended Tory plans for further deep spending cuts.
With the general election under five months away, the parties are drawing up clear battle lines on one of the central issues to voters.
Ed Miliband sought last week to win back trust in Labour's ability to handle the nation's finances by setting out a "tough and balanced" approach which would eliminate the current deficit "as soon as possible".
He said 2015 would be "a fight for the soul of our country", between Conservatives bent on slashing public spending to 1930s levels for ideological reasons and a Labour Party offering a "tough and balanced" approach which would eliminate the current deficit "as soon as possible".
But Mr Cameron said that beneath the "jargon" was a blueprint that would massively increase public borrowing and store up potential crises.
Only George Osborne's plans to have the budget running a surplus by the end of the next parliament could provide the cushion needed to weather another crash, he will say in a speech.
"At the height of the so-called boom years, far from running a surplus, Britain was running the biggest structural deficit in the G7. Then, in 2008, when the economic storms hit, we were completely exposed," he will warn.
"Our plan is about making sure that doesn't happen again. It's about saying that by 2018 we will be putting money aside so that if any crash or shock happens to our economy, we will be better prepared.
"And frankly, if we are not going to start putting money aside after seven years of continued economic growth, when will we be?"
Experts have warned that the scale of the squeeze required to meet the Chancellor's targets would mean spending cuts "on a colossal scale".
Liberal Democrat cabinet minister Vince Cable said they would "destroy public services in this country in the way we know them" and accused the Tories of embarking on an extreme "ideological" mission that would spell misery for voters.
But Mr Cameron will insist the Tory plans are " sensible and reasonable" compared to the " reckless" Labour strategy.
"Ed Miliband spoke about the deficit - and wrapped it all up in a lot of jargon.
"He claimed he would run 'a surplus on the current budget' and attacked our plans to 'balance the overall budget'. I want to peel back the jargon and tell you what this actually means.
"Ed Miliband is saying he will only balance part of the Government's budget, not the whole thing like we plan.
"And let's be clear what that means: Ed Miliband would never clear the overall, headline budget deficit. He would run a budget deficit, permanently adding to debt indefinitely. Every year. Forever."
Treasury calculations suggested Labour's policy would result over 21 years in a £500 billion bigger debt than on Tory plans, he will say, £30,000 more debt for every taxpaying household in Britain.
"That is a great, black, ominous cloud on the horizon and if a real economic storm hit again, the fall-out would be felt by families up and down this country...
"Our plan is about fixing the roof when the sun is shining. T he alternative is about taking a massive gamble with our future."
Labour questioned why the Chancellor had not - as promised in the Autumn Statement - yet set out details of legislation enshrining in law a commitment to eliminate the deficit on day-to-day spending by Government departments by 2017-18.
The move was seen as a trap for Labour but shadow chief secretary to the Treasury Chris Leslie said it was now "a shambles".
"In the Budget George Osborne was talking about a vote on balancing the overall budget. Then last month the Treasury tried to lay the ground for a big U-turn by briefing that the vote would only be on balancing the current budget, excluding capital investment.
"And now, after all the hype and promises that a new Charter would have been published over the last week, the Government has totally failed to publish anything. This is a total mess. As ever, these so-called Tory traps are backfiring on the Chancellor.
"George Osborne should spend less time playing silly political games and more time sorting out the economy and trying to make his sums add up."