Wednesday will be the Government's day of reckoning

GORDON BROWN used to look forward to Budgets. It was the annual opportunity for him to shower other people's money on his pet projects. Not any more. The Budget his Chancellor will be forced to deliver will make this Wednesday a day of reckoning.

It will not only be a moment when every Government prediction made about the economy is shown to be false. It will also be the moment when the British people realise that this Government is not just morally bankrupt, after the recent Downing Street smear scandal, but economically bankrupt too.

For the usual gimmicks and over-spun announcements will not distract attention from the terrible trinity of economic forecasts we are going to get from the Chancellor on Budget day: the longest recession in Britain since the Second World War; the fastest rise in unemployment on record; and the worst public finances in the world.

The last of those, the public finances, could sadly be the showstopper. We will see just how astronomical the debts are that Gordon Brown has burdened us and our children with.

There is no point sitting there in a stunned stupor, as many Labour ministers do when confronted with their economic car crash. This Budget should signal a new beginning. The mistakes of the past decade must be understood and not be repeated: we will not rebuild the British economy on a mountain of debt. We need a clear vision of our economic future as one where we save and invest rather than borrow and spend.

That requires a credible plan to restore stability to the nation's finances. I am clear that the bulk of the plan must involve restraining public spending rather than tax rises. As I've already said, we should not be over-taxed because Labour has over-spent. The Government's proposal last autumn for 1.1 per cent growth in spending in future years is unrealistic and needs to be reduced.

We also need urgent action in this Budget to help two groups particularly hard hit by the recession. A Conservative budget this week would save £5 billion across Whitehall and use the money to help the millions of savers and pensioners who are the innocent victims of the cuts in interest rates.

We would abolish the tax on savings income for millions of basic-rate taxpayers and increase the tax-free personal allowance for pensioners by £2,000.

We would also act to help the many thousands of young people who face a jobs crisis this summer. Instead of letting thousands of science, maths and engineering graduates leave university in June only to face life on the dole queue with their student debts, we would create 25,000 new places for masters degrees.

We need them to build a future economy that is not wholly reliant on banking, property and public spending for its growth. To help youngsters working to get their apprenticeships, but who are now losing the prospect of any qualifications if they lose their job, we would allow them to finish their training at a college or with another employer.

We need to save the next generation from the scourge of Labour unemployment. In doing so we will help change Britain from a country where the government thinks only about today, to one which starts to think about tomorrow.