Image caption Mr Redwood said it was a "nonsense" to suggest there would be job losses if the UK left the EU

The UK could end austerity if it left the EU by reinvesting the money spent on contributions in the economy and the NHS, Tory MP John Redwoood has said.

Mr Redwood, from pro-exit Conservatives for Britain, said the UK would be able to guarantee the current EU funding farmers and universities receive.

It would have £10bn left to spend on new nurses and doctors and to cut "unfair EU taxes" he said, as he set out what a post-exit first Budget could look like.

The in-out EU referendum is on 23 June.

UK voters will be asked whether they want the country to remain in or or to leave the European Union.

Elsewhere on Tuesday, former Labour leader Ed Miliband set out his case for why the UK should vote to stay in.

He argued that the only way to achieve social justice and progressive change was by being a member of the bloc and warned that Labour must not "sit out" the debate.

'Complete nonsense'

But Conservatives for Britain - a group created by Conservative MP Steve Baker - argue that the UK's current relationship with the EU is "untenable".

It says the UK currently spends £19bn a year, or £350m a week, on the EU.

It proposes that the "£9bn a year it receives back in services and the Rebate" could be used to guarantee the current funding that comes from the EU for farmers, universities and regional grants.

"And then on top we've got this £10bn we don't get back which we could spend on our priorities," Mr Redwood, a former Welsh secretary, told BBC Radio 4's Today programme.

Mr Redwood suggested the money could be spent on health and social care - and to pay the shelving of the disability cuts following the furore over the Budget plans.

"I think we could have a Budget which banished austerity and put prosperity in the front of all that it was doing because we'd have all that extra money to spend," he added.

The campaign group also proposes:

More than £2bn on the NHS, including on social care and recruiting more doctors and nurses

£500m for a local road fund

£900m to remove Stamp Duty on properties worth between £125,000 and £250,000

£1.5bn to "keep council tax down"

£1.9bn to abolish VAT

"Instead of spending billions abroad each year we should spend that money on improving our NHS and helping families by cutting unfair EU taxes. That's why the safe choice in this referendum is to vote leave," Mr Redwood said.

He also rejected as "complete nonsense" that there would be job losses in the event of an EU exit, saying trade would continue.

"Our trade is not at risk and our balance of payments would improve immediately we left the EU once we stopped paying the contributions," he told Today.

The potential impact of an EU exit on the UK economy is a hotly contested issue between the two sides of the referendum campaign.

Those in favour of a vote to remain say it would create a large economic shock in Britain, with a CBI report saying it could potential cost the country £100bn and nearly one million jobs.

However, credit agency Moody's said on Tuesday that the impact on the UK economy would be "small" and unlikely to lead to big job losses.

In his speech at a Labour In for Britain event, Mr Miliband accused Leave campaigners of wanting a "free-market, low-regulated, race-to-the-bottom offshore Britain".

To leave the EU would "only serve a reactionary, pessimistic agenda", he said.