DAVID Cameron last night put the North-East in the firing line for swingeing public spending cuts if the Conservatives win the General Election.

In an interview with the BBC's Jeremy Paxman, the Tory leader picked out the North-East as the region of England where state spending was too high and must be reduced.

Mr Cameron also refused - three times - to rule out a VAT hike in his first 'emergency' budget, which is likely to be unveiled in just six weeks' time.

He acknowledged that the Thatcher governments had been prepared to "tolerate" an historic leap in poverty, insisting there had been no alternative faced with a "busted economy".

And he declined to rule out a Cabinet place for Liberal Democrat leader Nick Clegg, while attacking the record of treasury spokesman Vince Cable, saying: "He has made a bit of a mess of it."

In the most revealing part of the interview, Mr Cameron - who has been repeatedly accused of keeping the details of his spending cuts under wraps - described the level of public spending in the North-East as "unsustainable".

Asked where the axe would fall, he first mentioned Northern Ireland, but went on: "There are other parts of the country, including the North-East, where many people would accept that the aim has got to be to get the private sector, to get the commercial sector going."

Told that people in the North-East would be "concerned", Mr Cameron insisted cuts were inevitable whoever won the election, adding: "I don't think you can make this into some ideological crusade."

Asked if he, and Shadow Chancellor George Osborne, were "immensely privileged young men with a glint in their eye", he replied: "I don't accept that. I didn't come into politics to make these sort of reductions that we are going to have to do."

And he insisted his priority would be to avoid job losses, saying: "If you don't fill posts that become available, particularly in the back offices, you can actually save serious money there, without people losing their jobs."

The interview came on the day that Gordon Brown claimed Conservative policies would have put 1.7m more people out of work during the recession, adding: "Our hard-earned recovery is too fragile to let these novices play with it now."

On VAT, Mr Cameron said the Tories had "absolutely no plans" to raise the tax, insisting the emphasis of his 'emergency' budget would be on spending cuts.

But Mr Paxman said: "That's not the same as a guarantee. I'm only asking you about your first budget, which could be in only six weeks?" Mr Cameron gave the same reply.

Asked if the Thatcher governments had done enough to stem the surge in inequality in the 1980s, he replied: "No. But this is now a new Conservative party."

Mr Cameron also described last year's VAT cut as a "very big mistake" and denied his plan for a £3-a-week marriage tax break was intended to discourage working mothers, adding: "I'm not giving a lecture to anyone."

The Conservative leader defended his plans to scrap inheritance tax for everyone except millionaires on the grounds that the tax should not hit people on "relatively modest earnings".

And he warned a Lib-Lab pact in a hung parliament would lead to more illegal immigration - because of Lib Dem plans for a partial amnesty - and to more dangerous prisoners being released onto the streets.

Mr Cameron declined twice to rule out a Cabinet place for Mr Clegg, while insisting a Conservative majority on May 6 was still "achievable".

Speaking afterwards, Lord Michael Bates of Langbaurghm deputy chairman of the Conservative Party, denied that Mr Cameron had lined the region up for large public sector cuts.

he said: "What David said was the North-East economy was in a position of imbalance and we need to get that back in balance by growing the public sector, not by cutting the public sector."