Alistair Darling has made it clear that next week’s Budget will not spell out any new spending cuts.
The Chancellor said the package on March 24 would instead focus on measures to encourage economic growth.
He also delivered a bullish assessment of the prospects for UK plc - suggesting lower-than expected unemployment could give him more room for manoeuvre.
The comments will fuel criticism that the government is trying to dodge setting out exactly how they plan to halve the country’s record £178 billion deficit over the next four years.
Speaking on Sunday, Mr Darling admitted that the Budget would be “critical” in deciding the result of the general election.
“Of course it is important because the economy and the decisions we take that will affect the next five, 10, 20 years are pretty critical to the big decision, the big choice the country will make whenever the election is called.
“Crucially we have got to plan now to ensure we get growth for the future because growth is what brings jobs, jobs is what will bring rising living standards.”
Asked if he would give details of spending cuts, Mr Darling said: “I will carry on spelling out what we have done, and the progress that we are making both on supporting the economy and reducing our borrowing levels, the deficit levels, that is important.
“But I have always said that because of the uncertainty we have seen over the last 18 months it would have made no sense to have been doing a (comprehensive) spending review at that stage.
“We won’t do one before the election, but of course one has got to be done this year because our current spending runs out at the end of March 2011.”
Mr Darling refused to give a guarantee that there would be no tax rises beyond the previously-announced hikes in national insurance and for top earners - despite Treasury Chief Secretary Liam Byrne seeming to make such a commitment last week.
“No Chancellor is ever going to say they are never going to change the tax system over the next five to 10 years or whatever,” he said.
He insisted the Government’s focus was on “how to get back to consistently solid growth numbers”. People were “beginning to see the results” of the action that had been taken to ease the effects of the downturn, Mr Darling added..
“To take for example unemployment, which is much much lower than we thought 12 months ago, plus the judgment that I have made in relation to the rate of reducing our borrowing (that) is sustainable,” he said.
The Chancellor said the Tories kept “shifting around” over tackling the deficit, but seemed to want to cut spending too early.
“If you go further and faster the risk is that you start damaging the economic fabric of our country,” he said.
But shadow business secretary Ken Clarke said significant reductions in expenditure may need to be combined with tax rises to stabilise the public finances.
“Everybody knows that a Conservative government would try to avoid tax increases,” he said. “The problem has been excessive spending. There is some very wasteful public spending that has got into the system.”
Shadow chancellor George Osborne also signalled that he would not be able to able to scrap the new 50p top tax rate for people earning over £150,000 until at least 2012.
“I regard the 50p rate as a temporary feature of the tax system. For a would-be Chancellor to say temporary is a clear statement,” he said.
But he went on: “I can’t say to the public sector we need wage restraint and at the same time cut the 50p rate.
Gordon Brown said: “When people see the budget, they will see the plan for the future which includes the halving of the deficit.
“We’ve got that under control, we’ve taken action to deal with the debt that comes as a result of the recession but at the same time we’re not going to cut frontline services for health and education and policing.”
Mr Brown indicated that the Budget plans would contrast sharply with the “blanket cuts” being proposed by the Tories.
“You can choose a government that is trying to take us through this recession and secure the recovery, or a party that would actually wreck the recovery and cause higher unemployment,” he said. “And you can choose a government that is determined, and we talked about it in the beginning, to get these new jobs for the future and to build the new industries or a government that’s got no industrial policy at all.”
The premier also played down fears over the hole left in the finances by the bank bailout, insisting: “Every penny, every penny that the banks have received will be paid back.
“I can guarantee you that is what is going to happen.”