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Gordon Brown's key spending strategy was mired in confusion today amid reports that health and overseas aid could be subject to cuts.
Claims that Labour will expose even such sensitive areas as the NHS to a "programme of public spending cuts" caused consternation at Westminster and Whitehall.
There were signs of divisions, with some Whitehall departments expressing uncertainty about whether Mr Brown's promise to maintain health spending in full will hold to the next election.
It came as the Prime Minister's leadership was increasingly being questioned by Labour MPs and ministers after a summer of political setbacks and disastrous poll ratings.
In a speech tomorrow, the Dagenham MP and influential Left-winger Jon Cruddas will argue that Labour has completely failed to lay a glove on David Cameron.
Mr Cruddas will say: "We have only months to get this right, otherwise we will go down to a catastrophic defeat."
A report in today's Guardian said health and aid budgets are no longer to be spared and that cuts will be rolled out over the next two months.
The change was said to follow two lengthy discussions between the Premier and Chancellor Alistair Darling, leading to a new focus on "frontline first", in which key activities would be guaranteed but reform stepped up elsewhere.
The Treasury would not confirm or deny the specific claim that NHS and overseas budgets could be cut.
Sources denied that Mr Darling would outline the alleged new strategy in a Callaghan Lecture tomorrow.
Lord Mandelson was reported to be revealing more about the new strategy in a Progress speech next week. But his spokesman said the speech would deal with reform rather than departmental budgets.
An opinion poll today put Mr Cameron on 40 per cent to Labour's 27. But it revealed the Tories are still failing to make a big breakthrough in the North of England.
Reader views (1)
So another u-turn in the making.
It really doesn't matter any more what Brown says, what figures he conjurs up from nowhere or what his latest parrot slogan is. No one is listening, just waiting for the end.
Let's face it, if Brown walked into a room and said"good evening everyone" no one would believe him.
- Ronnie, Billericay England, 07/09/2009 15:40
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