George Osborne has said he will not deviate from his plan to cut the deficit, as he warned the Treasury could not afford to cut taxes in the immediate future.
In a speech to the Conservative Party conference in Manchester on Monday, the chancellor said that borrowing too much money was the root of Britain's economic problems and he could not justify adding to the structural deficit.
"We’d be gambling the priceless fiscal credibility that this government has earned with the international markets on the bet that borrowing a few billion pounds more would make all the difference," he said.
"Right now, temporary tax cuts or more spending are two sides of exactly the same coin - a coin that has to be borrowed."
Much of the content of Osborne's speech had been widely trailed before he got to the podium and as such there were few surprise announcements.
The chancellor confirmed that council tax would be frozen for another year, which is expected to save people on average £72 a year.
He also announced a change to employment law intended to boost small businesses that would see workers having to wait two years before they could sue for unfair dismissal.
And he said the Treasury would fund increased investment in science and expand mobile phone coverage to a further six million people.
But one policy that had not been was announced before the speech was a plan to introduce "credit easing" in order to inject money directly into parts of the economy that need it such as small businesses.
In a move that is likely to upset his Lib Dem colleagues, Osborne insisted that Britain should not be overly aggressive in implementing regulations designed to tackle climate change
"We’re not going to save the planet by putting our country out of business," he said. "So let’s at the very least resolve that we’re going to cut our carbon emissions no slower but also no faster than our fellow countries in Europe."
Critics will question what that means for the the coalition's claim to be the "greenest government ever".
He also issued something of a coded reprimand to Lib Dem business secretary Vince Cable who had claimed that the Conservative were the "ideological descendants of those who sent children up chimneys" by reminding those listening that it was the Tories who had legislated to end to children becoming sweeps.
The chancellor delivered a steady and sober speech but he was keen to reassure those in the hall and at home that it was not all doom and gloom.
"I don’t pretend to you that these are not difficult days and that there are not difficult days ahead," he said. "But together we will ride out the storm. And together we will move into the calmer, brighter seas beyond."
And he did find space for a few jokes at the expense of Labour, including the observation that Manchester was the city "where Rutherford split the atom. And the Miliband brothers split the Labour Party."
The city played host to the Labour Party conference in 2010 where Ed Miliband narrowly beat his brother David to the leadership of the party.
Angela Eagle MP, Labour’s shadow chief secretary to the Treasury, attacked Osborne's speech as a "hotch-potch of small measures and re-announcements" that would not help to stimulate the economy.
Ministers still have no idea of the scale of the problem families and businesses are facing right now. Far from riding out the storm, George Osborne ripped out the foundations of the house as the storm was brewing by choking off the British recovery last autumn," she said.
And Tony Dolphin, the chief economist at the IPPR think tank, said Osborne “still does not understand the main problem facing the UK in the short-term. It is not too much debt; it is a lack of demand.”
“Nobody would argue that the Chancellor’s task is an easy one, or that he has much room for manoeuvre. But shoring up the confidence of businesses and consumers, so that they are more willing to go out and invest, hire new workers and spend, is just as important at this juncture as maintaining the confidence of financial markets. Nothing in this speech, suggests the Chancellor realises this fact," he said.