We've got a fight on our hands, admits David Cameron

David Cameron acknowledged today that the Tories had a fight on their hands in the General Election as he prepared for tonight's crucial televised leaders' debate.

The Conservative leader is under pressure to put in an improved performance after he was outshone by Liberal Democrat chief Nick Clegg in the first 90-minute encounter.

With the Lib Dems still riding high in the opinion polls after last week's head-to-head, Foreign Secretary David Miliband said that Mr Cameron now needed to deliver a "knockout" blow to his rival.

The Lib Dem resurgence threatens to derail Mr Cameron's hopes of reaching No 10 with an outright majority.

The Tory leader insisted that he was trying to ignore the "hype" surrounding the debate - to be hosted by Sky News in front of a studio audience in Bristol - and just "do what you normally do".

"We've got a fight on our hands. There's no doubt about it," he told reporters, after jogging in Exeter.

"These debates are big events and we've got to do everything we can to explain to people, particularly back home sat watching the TV, why we would make a difference, what we are about, how we would change the country.

"People are really depressed with politics at the moment and they need to be inspired."

However, Mr Miliband sought to pile the pressure on Mr Cameron, insisting that he needed to do better after having been "exposed" in the first debate.

"The style debate between David Cameron and Nick Clegg will carry on. David Cameron obviously needs to deliver a knockout to Nick Clegg," he told GMTV.

He acknowledged that Gordon Brown could not compete with his younger rivals on presentation, but said that he believed that the Prime Minister's strengths would come through as voters focused on the issues.

"Gordon is the only man standing on that stage with the strength and the clarity to govern the country. Because opposition is about protest but the government is about tough decisions and the right decisions," he said.

"The protest vote is clearly there and David Cameron has been exposed over the last week. Nick Clegg has punctured the fashion for David Cameron.

"We now have a bubble of protest for Nick Clegg, but I think that voters know the difference between judging a popularity contest in a debate and deciding who is going to govern the country for the next five years."

Meanwhile, senior Lib Dems were defending their leader amid signs that Tory-supporting newspapers were subjecting him to intense scrutiny ahead of the debate.

The Daily Telegraph reported that regular payments from three Lib Dem donors were paid directly into Mr Clegg's private bank account before he became leader.

A party spokesman said that the gifts went towards funding staff for his parliamentary office and were "properly made and declared".

In an interview with the BBC Radio 4 Today programme, Lib Dem home affairs spokesman Chris Huhne said it was a "smear" to suggest Mr Clegg - a former Eurocrat and lobbyist - was not a genuine political outsider.

"I think that's an absolutely ridiculous misreading of Nick and a ridiculous misreading of the Liberal Democrats," he said.

"If you want real change, you have got to go for the Liberal Democrats and to try and smear him by saying somehow he's taken the cushy, easy road to power is ridiculous.

"He has had serious jobs outside politics, running aid projects, negotiating with the Chinese government on trade."

However the Tories said that Mr Clegg had "serious questions" to answer about the payments made to fund his staff.

Shadow treasury minister Greg Hands said: "Nick Clegg must produce the paperwork to clear up some serious questions about these donations.

"Having raised the issue of expenses in the first TV debate, Nick Clegg cannot leave these questions unanswered."

Speaking in Bristol ahead of the debate, Mr Clegg told Sky News: "I received money from three friends which was properly given, properly received, properly declared, properly used to pay for part of the salary of a member of my staff.

"Any suggestion I did anything wrong is out of order and I'm going to publish the figures to prove it."

He added: "I must be the only politician who's gone from being Churchill to being a Nazi in under a week .

"But I hope people won't be frightened from trusting their instincts by doing something different this time."

Mr Clegg repeated that any insinuations over the donations were "seriously out of order" and reiterated that he would publish the figures.

"As for the other headlines, of course there are lots of people who want to block change," Mr Clegg told reporters.

"I hope people won't be bullied into, be frightened into not choosing something different.

"We have got a very exciting opportunity for real change in this country and I hope we will take it."

Mr Brown sought to play down the importance of debates in deciding the outcome of the election.

"People will make up their mind, not because of one debate. They will make up their mind because of a whole series of things that happen during this campaign," he said in an interview with Press Association Video.

He said that he had the experience to rebuild the economy after the financial crash and reiterated his warning that Tory plans for £6 billion of cuts would put the recovery at risk.

"I do fear for the economy this year after all the work we have done and (if) a Conservative government were to come in and cut £6 billion just like that, it would put the recovery at risk," he said.

"What we are doing is building an economy for the future after what has been the biggest global financial crash since the 1930s. All that requires the experience and determination that we have and also the new ideas that we can bring to bear."