DAVID CAMERON has brushed aside a stark warning that the Conservatives are doomed in the North-East – insisting any current unpopularity is due to having to make difficult and unpopular decisions.

In an interview with The Northern Echo, the Prime Minister rejected a claim, from a No 10 think-tank, that his party was paying the price in the North-East for being seen as the party of the rich.

And, defending the cuts programme to wipe out the budget deficit, he said: “It’s tough, difficult and painstaking work, but it’s something that’s very important for the whole country.”

The eve-of-conference warning – from the director of Policy Exchange – urged Mr Cameron to embark on a new blue collar modernisation, focused on the North and Midlands, where the Tories were struggling badly.

Neil O’Brien said: “The Tories urgently need a new round of renewal. It is still seen as the party of the rich. It does badly in urban areas, particularly outside the South-East.”

But Mr Cameron, asked if the Conservatives were becoming more toxic again in the North and were a party for the rich, replied: “I don’t accept either of those points.”

Pointing to the controversial decision to axe the 50p income tax rate, he added: “The top tax rate is higher now than it was for all but one month of 13 years of the Labour government.”

And he said: “We were left a budget deficit bigger than Greece, we were left an enormous hole that the last government dug and it takes time to get the country out of that.

“That means taking some difficult and unpopular decisions.

“When you look at what’s actually happening in the economy, it is rebalancing.

“We have lost jobs in the public sector – which was always going to happen, irrespective of who won the election, but a million extra jobs have been created in the private sector “And a lot of those million extra jobs are in various regions of the country, not just in London and the South.”

During the interview, Mr Cameron also: Ruled out leaving the East Coast Main Line in public hands, arguing privatisation of the network had led to “more people using the railways and more investment”; Insisted his government would continue to pursue local pay – but not regional pay – in public services, arguing flexibility would allow staff shortages to be plugged; Ruled out strict caps on second- home ownership in holiday areas such as North Yorkshire.

It was better to give local communities more power, through neighbourhood plans; Insisted proposed changes to Westminster constituencies were not dead – despite the Liberal Democrats withdrawing support – with a vote going ahead next year.

To illustrate his determination to “get Britain building”, Mr Cameron also announced the go-ahead for 57 road schemes – costing £170m – including: A19/A174 Parkway junction improvement, Middlesbrough (£6.3m) – a scheme to cut congestion, by widening roundabouts and upgrading traffic signals, and improve access to new enterprise zones. It will be completed in 2015; A19/A689 Wolviston Interchange, Wynyard (£6.1m) – the A19 will be upgraded southbound and the A689 widened, with new traffic signals on all approaches.

Again, it will support investment in enterprise zones and finish in 2015; A1/A19 Seaton Burn Interchange and Fisher Lane junction improvements, Northumberland (£6.1m) – to reduce congestion by improving the A1 northbound and southbound, also widening the A1068, A1 and A19 approaches.