David Cameron today pledged a "relentless focus on growth" to help fill the hole left by the coalition's public sector cuts.
The Prime Minister insisted his policies would unleash a "new economic dynamism", urging business leaders to plough more of their profits into innovation.
But Labour leader Ed Miliband hit back immediately, accusing the Government of taking a "big gamble" by pushing through deep cuts that would destroy hundreds of thousands of jobs and act as a drag on UK plc.
And one of the most senior Liberal Democrats in the coalition, Business Secretary Vince Cable, risked embarrassing Mr Cameron by mocking his past economic judgment.
The clashes came as all three men addressed the CBI conference in central London.
Delivering his first speech to the body since entering Downing Street, Mr Cameron said ministers were determined to create the conditions in which entrepreneurs could flourish.
He stressed that the Government was still pumping cash into major capital projects despite the £81 billion cuts package announced last week, and unveiled a detailed national infrastructure plan to ensure the country was not left behind by developing competitors such as China.
The coalition would also invest more than £200 million over the next four years in technology and innovation centres to bring universities and business together, he said.
"When we say we're going to build a new economic dynamism, we mean it," Mr Cameron said. "In the weeks and months ahead, ministers will be developing detailed plans to turn this strategy into action.
"Everything - from bank lending to skills, green tech to high tech, competition to innovation, international trade to local growth - will be put under the microscope.
"That forensic, relentless focus on growth is what you will get from this Government.
"What I need in return from you is a commitment to create and innovate, to invest and grow, to develop and break boundaries.
"The new jobs, the new products, the new ideas that will lift us up will be born in the factories and offices you own - not in the corridors of Whitehall."
The Prime Minister said British business would have "no more vocal champion" than the Government as it tried to help drive growth, and removing the structural deficit over the next four years would provide stability for investment.
He promised a "wholesale change of attitude" from Labour's period in office, saying the Government would "get behind key industries in every region of our country".
The premier also sought to reassure critics of the coalition's planned immigration cap that it would not be a bar to UK firms recruiting the "best talent" from overseas.
However, Mr Miliband - delivering his first speech to the CBI since becoming Labour leader - warned it was not right to assume that "all else will flow" from deficit reduction.
"I honestly have to tell this audience I fear that that is a big gamble with growth and jobs," he said.
"Even more importantly, it doesn't address the deeper risks and flaws in our economy.
"I think to think that deficit reduction is the only answer for our economy is actually to be quite pessimistic about what our economy can achieve.
"I believe we need to take a different and more optimistic approach, an approach that sees deficit reduction as a start not an end and is willing to learn the more profound lessons of the crisis.
"It's only this that will truly serve the interests of British business, it's only this that will insulate business from the risks that are part and parcel of the financial services industry, it's only this that will support the creation of British businesses that can lead in the global economy of tomorrow.
"It's only this that can provide fairness, prosperity and economic stability."
For Britain to move forward there had to be a new system of financial regulation, a better balance in the economy, and the chance for everyone to make "a decent living".
Making his appearance at the conference this afternoon, Mr Cable strongly supported the coalition's plans.
But he also risked controversy by mocking Mr Cameron's old mantra about "sharing the proceeds of growth" between tax cuts and public services.
Mr Cable said "just a few years ago" most politicians had been convinced that the UK economy was in rude health and could continue to boom indefinitely.
"I don't mean to be mischievous when I point out that even my Conservative coalition colleagues were busy developing policies about 'sharing the proceeds of growth'; the assumption - widely shared - being that strong growth was bound to continue," he added.
"Those of us who were worrying publicly about the unsustainable build-up of household debt, the housing bubble and the lending practices of banks were regarded as eccentrics or party poopers.
"Now, instead of sharing the proceeds, we need to think hard about how to grow out of a crisis."
The Prime Minister's spokesman said he did not see "any contradiction" between the comments and Mr Cameron's speech.
"The fact that the vast majority, if not all, economic forecasters got it wrong a few years back, we know that already," he said. "I do not see any contradiction."
Asked if the premier had read Mr Cable's speech, the spokesman said: "He is in meetings this afternoon. I don't know whether he stopped to watch the TV. A copy of the speech, I am sure, came to Number 10."
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