Media playback is unsupported on your device Media caption David Cameron: "We've got to do more to get the homes built that we need"

David Cameron has promised up to 200,000 extra affordable homes and 400,000 new jobs in an interview with the BBC's Andrew Marr Show.

The PM ruled out a U-turn on spending cuts but denied he was "sitting back" in the face of economic stagnation.

He cited plans to boost the "right-to-buy" in England and release government land as examples of action being taken.

But Labour said the economy was "flatlining" thanks to his policies and he had run out of ideas.

As the Conservatives began their annual conference in Manchester, a TUC-organised anti-spending cuts rally took place in the city centre.

An estimated 35,000 people attended, many blowing whistles and horns, waving flags and chanting: "Tories out."

In his BBC interview, Mr Cameron dismissed calls for "a few billions" of extra spending - suggesting it would be a dangerous gamble to "deviate" from the government's tight deficit-reduction plans, as the Conservatives gathered in Manchester for their annual conference.

'Big difference'

Asked about claims by a senior Tory backbencher that the government lacked a coherent strategy for growth, Mr Cameron said: "We are firing up the engines of the British economy.

"There is a step change taking place right now. This government is not just sitting back."

If there is a message that David Cameron wishes to get across this week, it came in the last words of his interview with Andrew Marr: "We have got to explain to people there here is something better at the end of this". That now is the benchmark by which the Conservative conference will be judged. The prime minister said he understood people were feeling the impact of rising energy prices, the cost of the family shop, the wage freezes in the public sector. But he made clear that the government is not about to deviate from its deficit reduction plans. He said those calling for a few extra billion to be pumped into the economy via tax cuts would "put at risk the interest rates that are vital to our economic survival". Instead, he said that the government must do more to explain how it was going to 'build an economy that is worthwhile". Read Landale's thoughts in full

In other developments:

The government is to increase the discounts available to council housing tenants in England who want to buy their own homes.

The move is an extension of a the "right-to-buy" policy which proved a vote winner for Margaret Thatcher - but which critics said decimated the stock of social housing and fuelled a house price bubble.

Cash raised by the sale of council housing will be spent on buying further homes, which will then be rented out at a reduced rate, under the plans to be outlined fully in a housing strategy later this year.

Asked by the BBC's Andrew Marr if there were enough council tenants for it to make a difference, he said: "There are over two million homes that are still available to be bought.

"So this is something that will make a big difference. And again that could provide another 100,000 homes, another 200,000 jobs.

"So taking those two policies together that could be 200,000 extra homes, 400,000 extra jobs."

'Reckless cuts'

On proposed changes to the planning laws, which critics fear will spell the end of the green belt, Mr Cameron said he would no more put the countryside at risk than he would his family.

He said there were "some scares" in circulation about the proposals and he stressed that the changes would not, for example, allow advertising hoardings to be put up everywhere.

All the Tories can do is re-announce old policies - in a desperate attempt to save face at their conference Caroline Flint, Shadow communities secretary

But, he added, the rule book needed to be simplified and the changes would give communities a greater say on the extra housing they need to keep their shops, pubs and post offices alive.

Labour announced its own five-point plan for growth at its conference in Liverpool last week - and it was quick to denounce Mr Cameron's latest claims.

Shadow communities and local government secretary Caroline Flint said: "Thanks to this government's failed policies and reckless cuts which go too far, too fast, the housing market is stuck in a rut and our economy is flatlining.

"But all the Tories can do is re-announce old policies - in a desperate attempt to save face at their conference.

"If the government really wants to kick start the construction industry, they should back Labour's plans to repeat the bankers' bonus tax to build 25,000 new homes and cut VAT on home improvements to 5%."

The government's aim is to build one new home - to be let at up to 80% of the market rent - for each property sold.

The policy, which could affect up to 2.3 million families in England, is understood to have been approved by senior Liberal Democrats.

Hague message

Economic issues are expected to take centre stage at the Conservative Party conference - as was the case for Labour and the Liberal Democrats - and Mr Cameron, who will close the conference when he speaks on Wednesday, has insisted the government has an "incredibly active" growth strategy.

Foreign Secretary William Hague opened the conference with a crowd-pleasing attack on Labour - mocking Ed Miliband's speech to his party conference last week and vowing the government would stick to its guns on the deficit.

"The solution to excessive borrowing and debt cannot be more borrowing and debt, and now we have a government that knows it," said Mr Hague.

And, in a message to the anti-cuts protesters, he said: "The money you were promised by the last Labour government never existed, it was never there, and we have been left with the task of telling you the truth."

He said it was "wrong, unfair and irresponsible" to leave "massive debt" for the next generation, adding: "Our resolve to deal with this is and will remain unwavering."

Mr Hague will make a speech on foreign affairs to the conference on Wednesday.