Ed Balls outlines £250 million jobs pledge as Labour leadership race hots up

Ed Balls put employment at the centre of his campaign for the Labour leadership today by outlining a £250 million plan to create 200,000 jobs and work placements for the unemployed.

As ballot papers continued to land on the doorsteps of Labour Party members, he insisted his policy went "to the heart" of the alternative he would be offering on the economy.

And he called for a new guarantee to ensure that anyone unemployed for more than 18 months would be given a job or work placement.

The shadow education secretary stressed his plan would ensure everyone of working age had the right to a job - and the responsibility and requirement to take it.

Mr Balls, who was a key lieutenant of Gordon Brown, said Labour had to be the "consensus-changers" and challenge the "misguided view" that cutting spending to reduce the deficit was the right priority this year.

He was speaking after the Labour Party was rocked by the publication of Tony Blair's memoirs on Wednesday, which have reopened old wounds about the Blair-Brown feud during Labour's years in government.

Some believe Mr Blair also came close to endorsing the economic approach of the coalition Government when he wrote in A Journey: "If governments don't tackle deficits, the bill is footed by taxpayers, who fear big deficits now mean big taxes in the future, the prospect of which reduces confidence, investment and purchasing power. This then increases the risk of a prolonged slump."

But Mr Balls said: "Labour must be the consensus-changers and challenge the misguided view that cutting spending to reduce the deficit is the right priority this year or that we can somehow cut our way to recovery.

"We need to do more to boost jobs, promote growth and get the economy moving again. That's why this week I have called for 100,000 more affordable homes to be built to tackle the housing shortage and create hundreds of thousands of private sector jobs."

He added: "This policy goes to the heart of the alternative I am setting out on the economy.

"The best way to secure economic recovery and get the deficit down over time is to make sure more people are in work and paying taxes.

"The right to a job and affordable housing should be the foundations of a strong and stable society and that's why I've put them at the heart of my leadership campaign this week."

One of Mr Balls' leadership rivals, Ed Miliband, received a boost to his own leadership campaign when he received the backing of the left wing Tribune magazine.

The publication's leader announced support for Mr Miliband's candidacy, but also pointed out the merits of Mr Balls and left-wing MP Diane Abbott.

It said its support for Ed Miliband was "primarily a result of the younger Miliband's declared willingness to seek a new direction for Labour."

Editor Chris McLaughlin wrote: "Ed Miliband has the passion, the clear vision, the strength and personality to lead Labour and the country in a new direction."

The magazine also praised Ms Abbott over her position on cutting Trident, and said Mr Balls "made the most significant intervention on the defining issue of this contest, the party's future and the economic health of the country, when he set out the case for an economic alternative which puts investment not cuts at its heart".

Mr Brown simply shrugged off Tony Blair's description of their relationship in his memoirs, Mr Balls said today.

He said he had spoken to Mr Brown the night the book was published and told him it was "one-sided and unfair".

Mr Balls told BBC Radio 4's Today programme: "He shrugged his shoulders and said, in life you should think about the future."

Mr Balls repeated his attack on the Government's deficit reduction programme, calling it "profoundly dangerous, very risky".

He added: "The deficit matters and has got to come down in a steady way over a number of years as we deal with the consequences of the financial crisis.

"But if you try to cut the deficit hard and fast, the danger is you put jobs and growth at risk."