LABOUR would keep Britain permanently in the red and create a never-ending budget deficit, George Osborne has claimed, as the main UK parties traded more blows on tax, welfare and spending.

For its part, Labour seized on how the Chancellor repeatedly refused to rule out rolling child benefit into Universal Credit, which, the Opposition claimed, would leave more than four million UK families £1000 a year worse off.

Elsewhere, Nick Clegg for the Liberal Democrats claimed the Conservatives had an agenda of "cut and cut and cut", which would mean the loss of tens of thousands of police officers, carers and military personnel to pay for ideologically-driven Tory tax cuts.

At a press conference in London, Mr Osborne sought to demolish Labour's economic policy using graphs and charts, showing how Ed Miliband's party would increase taxes by £15bn and borrow £30bn.

Stressing how once the overall deficit was eliminated by 2018, the Tories would "fix the roof while the sun is shining" and bear down on debt, the Chancellor noted how Labour did not want to do that and only wanted to tackle the day-to-day budget deficit while continuing to borrow to pay for capital spending.

"What they don't tell you is that means a permanent, never-ending budget deficit; year after year, spending more than we raise," he declared.

The Tories calculated that, given they had said they would spend £30bn a year on capital investment in 2018/19, and assuming Labour did not want to spend less than them, then this would mean at least £30bn of borrowing a year.

"A £30bn budget deficit forever into the future," claimed Mr Osborne.

But later, the Chancellor refused to rule out categorically rolling child benefit into Universal Credit to help contribute towards Conservative plans to save another £12bn from the welfare budget.

"If you judge us on our approach in this Parliament and if we wanted to put child benefit into Universal Credit, we would have done it when we set up Universal Credit," insisted Mr Osborne.

But Chris Leslie for Labour suggested the Chancellor had been found out.

"The Tories won't admit where their £12bn of welfare cuts will come from but after this press conference it's now clear middle income families are in the firing line.

"George Osborne repeatedly refused to rule out rolling child benefit into Universal Credit. This would mean 4.3m families losing over £1000 a year, according to the independent Institute for Fiscal Studies(IFS)," added the Shadow Treasury Minister.

Meantime, in a question-and-answer session with workers in Bristol, Ed Miliband attacked the Conservatives for repeating claims Labour would increase taxes on working families by more than £3000, denouncing the number as "wrong, wrong, wrong".

The Labour leader accused Tory HQ of making the figure up and noted how it had been criticised by the IFS.

He claimed it showed the Conservatives had "got nothing to say about the future of our country," adding: "It is the most negative, poor, pathetic campaign being run by the Conservative Party."

In a separate development, the Deputy Prime Minister emphasised how the Tories' promised tax giveaways would have to be paid for by deep cuts to public services, hitting unprotected departments by a further 6.6 per cent reduction.

"To find that money, they will have to do what Tories do best: cut," he told reporters at a press conference.