LONDON - British Prime Minister Gordon Brown will focus on housing, health and education on Monday when he sets out plans for the final few months of his government before an election that could end Labour's long grip on power.

The election due by mid-2010 is likely to be dominated by debate over how to curb a budget deficit that will reach 175 billion pounds ($288 billion) this year, more than 12 percent of gross domestic product.

All the main parties have been damaged by a scandal over lawmakers' expense claims but Labour, in power since 1997 and lagging the centre-right Conservatives badly in polls, has been hardest hit because it presided over a discredited system.

Labour says the opposition would make big cuts in core public services if it won the election, but the party also refuses to release its own spending figures.

Business Secretary Peter Mandelson told the BBC that government spending plans for 2011 onwards would not be set out until after the election because any earlier plans would be based on highly speculative projections of what economic growth will be in future years.

Labour is hoping Britain will start to pull out of its deepest recession since World War Two by the end of the year, boosting voters' morale and making the budget arithmetic slightly less daunting.

Economic conditions will have eased and the prospects for recovery will be stronger before the election, and I think many will take a more balanced view of the prospects for public spending and investment, Mandelson said in an interview with the Financial Times on Monday.

Brown will announce his legislative plans in a speech to parliament at 1430 GMT on Monday.

CONSERVATIVES SAY CUTS INEVITABLE

Conservative leader David Cameron said there was a thread of dishonesty running through this premiership when it came to any acknowledgement that spending will have to be cut.

But pressed for his own plans for cuts, Cameron referred to small measures that his party has already proposed, such as cancelling a costly plan for a national ID card, and said other initiatives would have to be announced at a later stage.

The cupboard is bare. Tough decisions must be made. Cuts cannot be avoided, whoever wins the next election. It might not be easy on the ear, but it is the truth and the public does not deserve anything less, Cameron told reporters.

Mandelson also indicated plans to sell part of postal group Royal Mail were likely to be delayed because parliamentary time will probably run out.

The proposed sale had proved unpopular with Labour members of parliament (MPs) and Brown can ill afford more unrest after facing down a party revolt earlier this month.

(Additional reporting by Luke Baker and Kate Kelland)

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