Prime Minister David Cameron expected to kickstart Government reshuffle

David Cameron is expected today to kickstart a double-pronged relaunch of his Government with his first major reshuffle.

The Prime Minister is also preparing a £50 billion infrastructure plan to help fund new roads, flood defences, power stations, railway lines and broadband projects.

But moves to allow more homes to be built in the Green Belt as part of the attempts to boost the flagging economy will be opposed, campaigners have pledged.

Chancellor George Osborne is coming under increasing pressure over the double-dip recession, with the economy flatlining despite falling unemployment.

Yesterday senior Tory David Davis joined the attack, pointing out other countries like Germany and Switzerland were performing better.

He said: “An alibi is not a policy – there is a risk that by focusing on parcelling out blame, we accept our circumstances with too much fatalism.”

Mr Davis was Mr Cameron’s closest challenger for the Tory leadership in 2005, and accused his Government of making “heavy weather” of deficit reduction while growth prospects were looking poor.

The economy needed “shock therapy” to avoid the serious risk of decades in the doldrums, he warned.

Mr Davis called for a wide-ranging package of support for small and medium-sized companies, including cutting taxes, regulation and energy costs and ensuring bank lending was available.

Mr Osborne has insisted “there is no alternative” to his policies, echoing Margaret Thatcher.

But he has promised new Bills to allow the Government to use its balance sheet to underwrite new construction projects and speed up the planning process in a bid to boost new development.

The Infrastructure (Financial Assistance) Bill will allow £40 billion of construction projects to go ahead, by using the Government’s low interest rates to underwrite them.

And ministers are also believed to be finalising plans to underwrite up to £10 billion of new homes, including guaranteeing the debt of developers and housing associations.

Legislation is also expected to speed up planning decisions and appeals, and allow development of the Green Belt, if conditions are met such as providing equivalent amounts of land elsewhere.

But that will be unpopular with the Liberal Democrat coalition partners, and many Tories, as well as campaign groups.

The Daily Press told last week how the Campaign to Protect Rural England had started the fightback, publishing a map highlighting threats to the Green Belt.

They included giant pylons in Somerset and North Somerset, new homes and a park-and-ride scheme near Bath, a new road and urban extensions around Bristol and major development in Dorset.

The group said: “Ministers have consistently maintained that they value the Green Belt and want to see it protected. Now is the time to put these words into action.”

Mr Cameron has promised that the reshuffle will be across all levels of government, though he is not expected to move Cabinet heavyweights such as Mr Osborne, Foreign Secretary William Hague and Home Secretary Theresa May.

But his first major reshuffle since the 2010 general election could see changes for Tory Chairman Baroness Warsi, Welsh Secretary Cheryl Gillan and Environment Secretary Caroline Spelman.

Much attention has focused on the key role of Warsi, the Conservative Party chairman, who has publicly appealed to Mr Cameron to allow her to carry on in the post, but some Tory MPs want to see her replaced with a big hitter who can galvanise support for the party.

Employment Minister Chris Grayling and Housing Minister Grant Shapps have been touted as possible alternatives from outside the Cabinet.

Yeovil Liberal Democrat MP David Laws has been tipped to return to the front benches after months in exile following his forced resignation as Chief Treasury Secretary just days after the election over expenses claims.

Some Labour MPs have said he should not return until he has been backed by the voters at the next election.

However, the PM could give Mr Laws a lower-profile job, such as working with West Dorset Tory MP Oliver Letwin on drawing up policy, attending Cabinet, but not as a full member.

There will also be a more far-reaching reshuffle of the more junior ministers later in the week, with several West MPs being tipped for promotion.

Devizes MP Claire Perry, Bristol North West’s Charlotte Leslie and Chris Skidmore (Kingswood) are all highly-regarded Tories from the 2010 intake.