Cameron backtracks on spending promise

London: David Cameron abandoned his commitment to match Labour on spending as an opinion poll showed his lead over Gordon Brown has been almost wiped out.

In a keynote speech he said planned rises from 2010-11 onwards were "unsustainable".

He also prepared the ground to oppose next week's multi-billion-pound economic stimulus of tax cuts and spending financed by temporary borrowing.

"This means saying things that are not immediately popular," he said. "That we can't afford a massive tax giveaway paid for by a borrowing binge. That we can't afford a spending splurge."

His speech came as a poll revealed that Labour has surged to within three points of the Conservatives during the economic crisis, destroying a lead that was 20 points during the summer.

Mori put Cameron on 40 per cent, down five points, with Brown on 37 per cent, up seven, and the Liberal Democrats on 12 per cent, down two.

Party strategists said one poll was meaningless - but if it is echoed by others over the next few weeks there will be dismay among Tory MPs.

Wednesday's announcements by Cameron were intended to seize the agenda and halt the decline.

They opened real differences between the two parties and point to the next election being dominated by the tax-and-spending battle grounds of the 80s and 90s, with Tory charges that Labour will unleash huge tax rises to fund runaway spending and Labour allegations that the Conservatives would slash frontline public services such as the NHS.

Axeing the promise to match Labour spending also opens the prospect of shadow chancellor George Osborne being able to offer tax cuts at the election, to the delight of the party's Right wing.

Labour countered by promising to find far greater savings from Whitehall waste than previously promised, enabling them to claim any future Tory cuts would bite into mainline services.

But Cameron insisted, "What once looked affordable in boom times is now clearly unsustainable. Unless we curb the growth of spending, taxes will need to rise in the future."

"Without such restraint, the borrowing bombshell will turn into a tax bombshell," Cameron explained.

There was no detail given from the Tories regarding the size of their planned cuts.