Cameron: The deficit is our main priority

DAVID Cameron yesterday insisted spending cuts would boost the economy, amid rumblings of discontent from coalition backbenchers who fear the toughest spending squeeze in peacetime history could go too far.

Speaking at a public question and answer session in the West Midlands, the Prime Minister said there would be “light at the end of the tunnel” if his government manages to slash spending and reduce Britain’s huge budget deficit.

He added: “People need to know there’s a prize at the end of this, which is a successful decade for Britain, which is what I’m trying to deliver.”

Earlier in the day, Cameron and deputy Prime Minister Nick Clegg sent an open letter to all cabinet colleagues, reminding them that cutting the deficit was “the most urgent issue facing Britain”.

The letter comes amid growing uneasiness among a handful of Tories and Lib Dems, who feel the government is talking up austerity at the expense of outlining a positive strategy for boosting growth.

An official at the business department said the chancellor was using a “particularly blunt axe” to reduce Whitehall spending, instead of cutting more judiciously. “The Treasury’s take no prisoners approach means projects that actually boost growth and so reduce the deficit are marked for the chop.”

And City A.M. has learned that some cabinet ministers have been approaching Cameron directly with their spending plans, in a bid to win a reprieve for projects that are likely to be scrapped in the spending review.