David Cameron’s decision to ditch a major Conservative pledge to match Labour spending plans pound for pound was hailed by commentators as an important step in the politics of the recession, opening up a clear gulf between the two main parties’ economic policies but exposing the Tories to considerable risk.

Labour is expected to cut taxes, accelerate public spending and announce more borrowing in Monday’s pre-budget report. Now their supporters can revive the spectre of “Tory cuts” to funding for schools and hospitals which helped the Conservatives lose the last two elections.

For many of the newspapers, this is all part of a game being forced on the Tories by Gordon Brown’s rapid resurgence in the polls thanks to the economic crisis. A Mori poll this week found the once-mighty 26-point Conservative lead has slumped to just three points — equivalent to a Commons majority of four seats.

“In the extraordinary game of chess that is being played out against the backdrop of the recession, Cameron had no choice,” wrote The Independent. “But there are big risks for the Tories. Most non-partisan economists recognise the case for higher borrowing to pay for a fiscal stimulus. The Conservatives are virtually on their own in claiming spending cuts are an immediate answer.

“Spending cuts are also easier to announce than they are to implement, not least when the Conservatives have some ambitious spending programmes of their own. If Cameron comes up with any pain-free cuts, Brown will implement them first, as he did in the run-up to the last election.”

The Guardian said a curiously quiet period in British politics has come to a close with the announcement.

“Over the past few months the economy has been in wartime, beset by a banking crisis and a global recession, while politicians have been unsure how to react. Sure, Gordon Brown got his fill of summit-hopping. But most MPs have been little more than restive spectators of a crisis which will define economic policy for years to come and set the terms of the next election. That all ended yesterday.

“The political battle lines have now been drawn around one key question: who can best manage the recession?”

The Financial Times was in no doubt of the importance of Cameron’s policy tack. “He has taken one of the biggest gambles of his near three-year tenure … bucking the corporate and economic consensus to bet on a fundamental shift in voters’ attitudes in the next election,” it wrote.

“He believes he will be proved right in the long term as the recession deepens and voters increasingly blame Mr Brown for the state of the public finances rather than turn to him as the best hope for economic recovery.”

That may be a good move, the paper added, if the election comes in 2010 but could backfire if, as some commentators are suggesting, Brown decides to go to the country before things get too bad.

Several papers applauded Cameron for opening up a clear choice for voters in how deal with the coming hard times.

“On the big issue of the day, the route out of recession, there is now a genuine choice,” The Times said, while the Daily Mail declared: “With one bold decision, Mr cameron set himself free to offer a meaningful alternative of real substance.”

The Daily Mirror spoke of thick red lines now having been trawn between the two parties and warned the Conservatives  were missing the public mood.

“Every nurse, care worker, soldier and their families now has a vested interest in voting Labour,” it wrote.

But The Sun applauded Cameron’s move. “Labour seems ready to gamble the entire economy on a “cut now, pay tomorrow” burst of tax reductions financed by ever-higher borrowing,” it said. “That is the economics of the madhouse.”

“At last the Tories seem to be finding their voice. They have decided to put hard-working taxpayers first — and dump their daft promise to match Labour’s bloated spending.”

Prime Minister Gordon Brown has suggested he will push expansionary fiscal policies to help boost the economy. Brown’s comments were the latest in a series from him and Chancellor Alistair Darling stressing the importance of boosting the economy, which shrank in the third quarter of 2008 for the first time in 16 years and is expected to contract more sharply next year.

Bank of England Governor Mervyn King has also put his weight behind “some fiscal stimulus”, just as the Bank predicted in its quarterly inflation report that the economy would shrink sharply next year.

But what is the way forward - tax cuts or higher public spending?

The dividing line between Brown and Tory leader David Cameron is whether to borrow to fund tax cuts. Cameron has argued that Britain’s deficit is too high to allow further borrowing. Brown says Cameron’s claim that he can pay for his tax cut by savings on welfare benefits isn’t realistic.

Tax cutting is a populist measure and it may be tempting for Brown, who no longer appears to be married to fiscal prudence, to go down that road, not least because of the backlash he faced earlier this year over scrapping the 10 percent tax band.

But there are a number of reasons why tax cutting may not result in a boost to the economy: government borrowing gets dangerously high and will limit the economy’s ability to recover swiftly from a recession, and people may decide to save rather than spend any extra money they might have in their pocket due to tax cuts.

What’s your view - do you think increased public spending will stoke demand, are tax cuts the way forward to boost the economy or should the government go for a mix of both?

Peter Mandelson has told the Observer that he and Prime Minister Gordon Brown have put their differences behind them and the pair are now “joined at the hip”.

But that didn’t stop Conservative leader David Cameron enjoying a joke at Mandelson’s expense on BBC TV’s Politics Show.

Put on the spot, an embarrassed-looking Cameron admitted that Conservative wags had named a unit of time after the newly-appointed Business Secretary’s surname.

The Tory wits define it as the time it takes between meeting the former EU Trade Commissioner and him saying something rude about Prime Minister Gordon Brown, Cameron confirmed.

“The point is that everyone who knows Peter Mandelson who has bumped into him recently has heard that he doesn’t always have great things to say about the prime minister,” the Tory leader said.

Taking note of the apparent rapprochement between two of the architects of New Labour, Cameron added: “A Mandelson will probably get a bit longer now.”

Stockport councillor Linda Holt started the queue for David Cameron’s closing speech at 10 a.m. this morning — four and a half hours before the Conservative leader was due to walk onto the stage at Birmingham’s Symphony Hall.

With 10,000 registered attendees — the highest at a Tory conference for many years — and only 3,000 seats, an early start was essential for those wanting to be in the arena to hear Cameron’s hour-long address.

(Reuters photographer Stephen Hird snapped this picture of Cameron on his way to rehearse the speech)

Last year the queue for Cameron’s closing oration snaked all the way through the exhibition halls of Blackpool’s Winter Gardens and almost out into the street. Many were turned away.

Holt was celebrating her 55th birthday by ensuring she would get a good position in the hall. But she said she didn’t want to hear anything “airy fairy” from the man who could be PM.

“He’s got to make an impact today … his speech is the one that everyone is waiting for,” she said. With events elsewhere pushing the conference to the inside pages, Holt said Cameron needed to deliver “some real dynamic stuff.”

By 11:30 a.m. — three hours to go — there were already more than 100 in the line. By 1:30 p.m., and still an hour before the start, the queue had grown so large the hall was officially declared full.

Ken Wood, 49, councillor in Longbridge and a parliamentary candidate in the safe Labour seat of Wolverhampton South East, said he wanted to hear Cameron talk about “stability”.

“Whether or not we are in difficult times. We’d be foolish to try to ignore it… but I’ve no doubt it will be very powerful, very straightforward and very focused.”

But Steven Bainbridge, 20, chair of a Newcastle University conservative student group, was bold enough to go off message and rebel against the conference’s officially sombre tone .

“We do need the serious stuff but it would be good to have a bit of triumphalism. I think when it’s the closing speech we need the chance to let our hair down.”

Gordon Brown has woken to some unhappy headlines during his year as prime minister but the verdicts on newspaper websites following Labour’s shock defeat in the Glasgow East by-election were probably the worst he has faced.

“Disaster” was the description of the Daily Mail and The Independent after one of Labour’s safest seats fell to the Scottish National Party. The Daily Telegraph called it “Humiliation for Brown” while “Catastrophe for Labour” was The Guardian’s verdict.

The latest terrible poll result, coming after Labour lost its deposit in Henley, left David Cameron clamouring for a general election and the focus once again on Brown’s future, with speculation once more that he will face a leadership challenge.

Is it all over now for Brown? Do you think it’s time for him to step down or be replaced? Send us your comments.

Glasgow East has a very different feel to Crewe as it gears up for Thursday’s by-election.

In Crewe and Nantwich voters were palpably enthused by the prospect of giving Gordon Brown and Labour a good kicking. They were aware of the national significance of a Tory victory and relished the chance to send Brown a stern message. Turnout was a high 58 percent and the Conservatives achieved a massive 17.6 percent swing to win the seat in May.

A walk around the housing estates and shabby shopping complexes of Glasgow East tells a different story. Many locals frown and scurry off when asked their political views. Others who do stop and talk express indifference. The by-election may be a two-horse race between Labour and the Scottish National Party (SNP) but apathy is running a close third. Turnout here was less than 50 percent in the 2005 general election and is expected to be much lower next week, particularly because of summer school holidays.

But Labour is braced for a thrashing and a drastically reduced majority. Lifelong Labour supporters said they were switching to the SNP or even to the Conservatives, who barely make it on to the political map in Scotland. Diehard Labour loyalists — people who vote for Labour because their mother, father and grandparents did — may just help Brown hold on to the seat but Labour appears to be losing the support amongst the working class that it has relied on in Scotland for decades.

Take Scottish pensioners Sarah Carlin and Catherine Matheson. They have voted for the Labour Party since they can remember but both said they plan to switch allegiances next Thursday. Carlin, 64, may vote Conservative, if she votes at all, while Matheson will plump for the SNP.

“I’ve worked all my days and I don’t get anything. I pay for my glasses, I pay for my teeth. I’m going to try the Conservatives. I’m sick of it,” said Carlin, having tea after an exercise class at the Tollcross Park Leisure Centre in Glasgow’s deprived east end.

Other “eastenders” have lost faith in politicians, worn down by what they see as a failure to tackle the crime and drug addiction that plagues the sprawling constituency.

Michael McGonigle, who owns a butcher’s shop in the east end, said the area has got worse over the years, beset by drug addicts and dealers.

“I’m not voting. I don’t believe in any of them. They’re all in it for themselves,” said McGonigle, 38, as he sliced beef in his store on Tollcross Road. “You see them day and night, druggies, methodone junkies.”

A few doors down, Stephen Mclellan, 37, who owns his own grocery store, is similar disillusioned.

“Nothing gets done. They just promise. I’d like something to be done locally,” he said, pointing at the drains outside his shop that he said flood every time it rains or the boarded up flats opposite. “There are too many people on methodone. They sell it at the bus stop, there is no support. Put police on the streets and the place would be ten times better,” added McGonigle, who is unsure who he will vote for, if anyone.

Politically-engaged locals agreed that Labour could have lost here if Margaret Curran hadn’t agreed to stand. She is a local political heavyweight and an energetic campaigner. Local taxi driver Robert Kemp, 54, thinks “a gun was put to her head. They needed a big hitter, so they said, Margaret, come and save our position.”

Others said that if the charismatic Alex Salmond had been standing, rather than the lesser-known John Mason, the SNP could have pulled it off — a result that would certainly have sent shockwaves all the way to Downing Street and could have sealed the prime minister’s fate.

(photo shows Scottish Labour Party candidate Curran campaigning in Glasgow)

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To nobody’s great surprise, David Davis swept home at the “liberties” by-election in his Yorkshire seat that he himself had engineered by resigning.

With neither of the other main parties standing, he was left to romp home in a field devoid of any serious rivals.

Davis says his stand was a shot across the bows of a government that he believes is crushing civil liberties by, among other things, trying to get the right to hold terrorist suspects for up to six weeks without charge.

Conservative leader David Cameron has been cool towards his gesture, Gordon Brown has called it a gimmick and several ratepayers in frugal Yorkshire have grumbled that the whole thing was a waste of public money.

What is your view. Bold stand or ego-trip?

For the first time since he became mayor of London on May 2, Boris Johnson has overtaken Conservative leader David Cameron in “favourability”, according to an opinion tracker published on www.politicshome.com.

Johnson scored a rating of 3, up from -7 at the end of April, while Cameron got rated 1, up from -5.

The PHI5000 tracker is based on replies from a politically balanced group of 5000 voters across the UK, who answer a survey every day for the site, which was launched in April and is powered by opinion pollsters YouGov.

The panel are asked daily questions on a rotation system, covering their attitudes to the whole political landscape. As part of this, politicshome tracks a wide range of political personalities, including Cameron’s and Johnson’s favourability ratings.

Because of the consistency of the sample and questionnaire of the tracker, the site is able to track subtle changes in public opinion, it says.

**Full coverage of the London mayor and local elections **

The election results for England and Wales at 8:00 p.m. with all 159 councils having officially declared.

Source: BBC

Conservative Leader David Cameron conceded this week he had broken his promise to end “Punch and Judy” politics in the House of Commons.

“I will absolutely hold up my hands and say this is a promise I have not been able to deliver,” he told BBC Radio’s Today Programme on Tuesday.

As if to prove his point, a day later Cameron accused Gordon Brown at Prime Minister’s Questions of political calculation over the 10p tax abolition and the proposed extension of pre-trial terrorism suspect detention to 42 days.

A day before local elections in England and Wales, Cameron said: “With 10p it was about trying to pose as a tax cutter. This time (on 42 days) its about trying to pose as being tough on terror.”

To uproar Cameron added: “He is putting political calculation and self interest ahead of the right decisions on the national interest.”

Brown retorted: “This is the man who wants to be both tough on crime and hug a hoodie at the same time.

“This is the man where political calculation meant he cycled to work but at the same time he had the chauffeur-driven car coming behind.

“This is the man who is a shallow salesman and never addresses the substance of the issue.”

The exchange of personal comments was too much for Liberal Democrat MP Julia Goldsworthy who told BBC television afterwards that the language used was “more suited to the playground.”

“This is the one opportunity a week to hold the prime minister to account, and I think a lot of the rowdiness is a sad reflection on the behaviour in the House of Commons.”