Conservatives propose "government of thrift"

By Matt Falloon

CHELTENHAM, England (Reuters) - The Conservatives would slash budgets to help bring public borrowing back under control in a "government of thrift," leader David Cameron told his party's spring conference on Sunday.

With an election probably just over a year away and the opposition Conservatives tipped to win as the public grows disillusioned with a 12-year-old Labour government, Cameron is under pressure to explain to voters how he might govern.

"It is clear now that this will not be any old election," he said. "It will be one whose outcome will shape Britain for a very long time."

"Unless we deal with this debt crisis, we will once again become the sick man of Europe again ... Labour's debt crisis means public spending cuts."

Before the last Conservative government took charge in 1979, Britain was known in some quarters as the sick man of Europe because of industrial unrest and weak economic performance.

The Conservatives, after years of infighting following defeat to Tony Blair's Labour in 1997, are now well ahead in opinion polls which show Britain is losing faith in Prime Minister Gordon Brown's handling of the economic crisis.

Chancellor Alistair Darling forecast on Wednesday government borrowing would soar to 175 billion pounds this year and the state would have to sell a record 220 billion pounds in bonds, triggering concerns in markets about over supply.

Darling is banking on a sharp economic recovery to help balance the books after a contraction of 3.5 percent this year.