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David Cameron today ditched his party's commitment to match Gordon Brown's public spending until 2011, claiming that Britain had "maxed out on its credit card".

In a shift of policy designed to place clear blue water between the two main parties, the Conservative leader said that the Government's spending plans for 2010-11 were unsustainable after years of borrowing, creating a "bombshell" that would necessitate steep tax rises in future.

Mr Cameron also indicated that he may oppose the Prime Minister's proposed short-term tax-cuts, or "fiscal stimulus", which the Government is expected to announce in next Monday's Pre-Budget report, although he would not confirm whether he would vote against them until he saw the details.

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He said that widespread tax-cuts would be unaffordable during a recession, leaving the Treasury forced inevitably to raise taxes steeply in the long term.

The Tory leader hopes that the announcement — made less than a week before Labour unveils its own plans in detail in Alistair Darling's Pre-Budget report — will free the party to make future tax pledges without being straitjacketed by spending commitments. He has asked a team of strategists to study Whitehall budgets in order to find potential savings to fund future tax cuts.

He hopes his proposals, rubber-stamped by the Shadow Cabinet at a meeting this morning, will give the Tories a clear sense of economic direction for the coming months, easing nerves among the public that Mr Brown is better placed to steer Britain through recession.

The policy-shift creates the prospect of an unlikely battle at the next general election between a tax-cutting Labour Government and Tories opposing such moves.

Critics, however, labelled Mr Cameron's policy "the economics of the madhouse", saying that cutting spending during a recession would lead to increased poverty in already tough times.

"Labour’s economic mismanagement makes it vital for the long-term health of our economy that we set a new path for restraining the growth of spending," Mr Cameron said, indicating that a £30 billion injection to the economy would mean an 8 per cent rise in income tax later.

"That means for the year 2010-11 we need change, not more of the same. That means reducing planned government spending growth and not matching Labour’s spending plans.

"To be absolutely clear: to stop future tax rises, the growth rate of spending in 2010-11 will have to be lower than the growth rate laid out by Labour. The growth rates of spending in the years beyond 2010-11, pencilled in by the Chancellor last year, are also now unsustainably high."

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