Be honest on spending cuts - Tory

His intervention marks a bold attempt to shift the terms of political debate and undercut Gordon Brown's attempt to cast the coming election as a choice between Labour investment and Tory cuts.

Mr Osborne said the real dividing line in British politics was now between honesty and dishonesty about what the future held.

The shadow chancellor's comments came as Mr Brown's close ally Ed Balls used an article in The Guardian to argue that the coming election would present voters with a dividing line between "Labour investment versus Tory cuts".

Labour has seized on shadow health secretary Andrew Lansley's comments last week, suggesting that Tories would cut departmental spending by 10% in all areas apart from health, international development and schools, to claim that a Conservative victory in the election expected next year would mean tens of thousands of frontline job losses in public services.

But writing in The Times, Mr Osborne said: "The real dividing line is not 'cuts versus investment', but honesty versus dishonesty.

"We should have the confidence to tell the public the truth, that Britain faces a debt crisis; that existing plans show that real spending will have to be cut whoever is elected; and that the bills of rising unemployment and the huge interest costs of a soaring national debt mean that many government departments will face budget cuts.

"These are statements of fact and to deny them invites ridicule."

Mr Osborne said the Prime Minister's unwillingness to confront the reality of future spending cuts was "intellectually fatal for the Labour movement".

He added: "The big discussion in British politics for the foreseeable future will be how to tackle the debt crisis and deliver quality public services when spending is tight. Gordon Brown has taken his party to the sidelines of that discussion."