A fresh crackdown on tax avoidance will fund £1,000 eco-handouts for homebuyers, George Osborne insisted yesterday.
The Chancellor said the coalition will keep the public finances under tight control as he gave details of a shake-up of green levies that could see £50 shaved off energy bills.
Speaking on the BBC's Andrew Marr Show, Mr Osborne said his Autumn Statement on Thursday would stick to the task of delivering a "responsible recovery".
Despite signs of a sharp upturn in growth, he said there were still "lots of risks" for the economy and increasing borrowing would be "disastrous".
Asked how £1,000 grants for homebuyers to improve energy efficiency and cuts to environmental levies on bills would be funded, Mr Osborne replied: "The money will come from additional taxes that we will raise from dealing with tax avoidance."
Chief Secretary to the Treasury Danny Alexander said he hoped the coalition's proposal would persuade Labour to drop its "barmy idea to con the public'' with a 20-month energy bill freeze should it win the 2015 general election.
He explained the new measures paid for by "tax dodgers" would also "not sacrifice a single gram of carbon" that the coalition was already aiming to save.
Speaking on Pienaar's Politics on BBC Radio 5Live, Mr Alexander said: "We are just doing it differently. So, rather than saying that bill payers should pay all these costs for other people to insulate their homes, we're saying instead that tax dodgers should pay that because we're going to use the taxpayer to pick up some of those costs and use that money to give people extra financial incentives.
"So, if you like, we're helping to take money off people's bills through the energy companies and we're paying people to take action to cut their own bills further."
But shadow chancellor Ed Balls claimed the coalition's new energy announcement would "not last 24 hours", adding the lack of answers from Deputy Prime Minister Nick Clegg and Prime Minister David Cameron made them look "a bit naked today".
He told 5Live: "I think by Thursday George Osborne will have to come up with something more but this is not going to be good enough."
Mr Balls added: "What's happened today is David Cameron and Nick Clegg, in a rather bizarre joint article in The Sun, have decided they're going to try and engage Ed Miliband on Labour's territory – pointing out the cost of living crisis, the failure of action on energy prices, the fact that most people are worse off not better off compared to 2010.
"But they've raised the issue and they've not got an answer and therefore... I think David Cameron and Nick Clegg both look together a bit naked today."
To laughter, Mr Balls added: "That was not intended to be more than a metaphor." Mr Balls told the Andrew Marr Show: "I set two tests for George – one, would he stop bills rising? Secondly, would the energy companies pay?"