I AM in total agreement with Dr John Hill that Britain must balance its books to survive (HE, August 31).

I can also tell Dr Hill that the Labour Government has actually taken the necessary steps with a sensible Keynesian fiscal boost that other countries in the G20 are copying.

The Chancellor in his budget report this year presented his proposals to balance the books by making savings across departments, while protecting the NHS, education, pensions and skills training. Taxes will rise for those earning £150,000 or more and duties on fuel, tobacco and alcohol will increase.

The Treasury estimate that because of the VAT cut, the car scrappage scheme and bringing forward capital projects and quantitative easing, the economy will emerge out of recession this year and be in growth in 2010, thereby pushing up government revenues.

Economic green shoots are all around, economic confidence is surging as the stock market rockets, house prices recover and the manufacturing sector see more orders.

Dr Hill should know that if Gordon Brown had taken the advice of David Cameron and George Osborne to 'do nothing', another 500,000 people would be on the dole, while thousands more would have been unable to get places at colleges, universities and on apprenticeship schemes.

The priorities are clear for Labour — keep people in work, increase credit for individuals and businesses, and place the economy on a sustainable footing in the medium term. Alistair Darling has set out his financial programme to halve the deficit within four years.

We all know we are in tough economic times, but record low interest rates, low inflation and fairer taxation will help firms and businesses become more competitive and increase exports.

It was encouraging to hear Lord Turner, the chairman of the Financial Services Authority, call for a transaction tax on the City of London. It's only fair that the people who have made a killing out of the financial sector contribute to the wellbeing of all the British people rather than a few. A fairer tax system in Britain will balance the nation's book even quicker.

What is certain is that David Cameron's remedy for the British economy of swingeing public service cuts while his shadow ministers promise increases in their departments is, I believe, dishonest. In the 1980s and 1990s under Tory policies, millions were left on the scrap heap. The Conservatives were wrong then and David Cameron is wrong now. So I have to say to Dr Hill, you claim you are apolitical... well, lets hear the economic solutions of the Tories in Torbay.

DAVID PEDRICK-FRIEND (Dr)

Labour Prospective Parliamentary Candidate for Torbay