'Street fighter' Blunkett relishes key role in bid to retain power

In charge of the party's fund-raising drive and seeking to get some of the policies he has worked on from the backbenches into the manifesto, the former Home Secretary has once again shown his resilience.

And he is keen to use that position to exert his influence, not least in calling for caution when it comes to cutting the 175bn budget deficit built up during the recession.

While he backs Gordon Brown's pledge to halve the deficit in four years – which the Tories say is not fast enough and could threaten confidence in the economy – he says the remainder could be reduced over a further decade because it would be "suicidal to simply cut and burn and slash services".

"I think we should have a rational and sensible policy that says we will go for the short-term, drastic reductions because we have to and because we can't sustain the servicing of that debt if we don't, but then we should take another 10 years which is exactly what we would do if we were a householder," said the Sheffield Brightside MP.

"We've just paid off the American and Canadian loans from the Second World War. It's taken 60 years to write that off and I'm not suggesting we should spend 60 years on this deficit but I am suggesting that nobody would thank us in the future if we undermined growth by cutbacks, if we damaged a generation of youngsters in schools by cutbacks, or we undermined our public services."

His comments come as the economy and public spending prepares to take centre stage in the election campaign. The Tories have recently had to tone down calls for immediate cuts, while Labour will be expected to give more detail of its plans in the Budget, likely to be held in March.

An advantage of Mr Blunkett's election role is the opportunity to influence fellow Yorkshire MP Ed Miliband, the Energy Secretary who is charged with drawing up Labour's manifesto.

He is lobbying hard to get policy proposals he has produced since his second Cabinet resignation in 2005 included in the manifesto, particularly his desire to see a youth volunteering corps established to help address rising youth unemployment. Other radical policy ideas include raising child benefit and making it taxable to make the system fairer, making voting mandatory and the creation of a "reserve bank" where schools pool surpluses for the education system.

In May Mr Blunkett will mark his 40th year since first becoming a councillor, and having remarried last year he insists he is determined to carry on although, like many MPs, the turbulence of the expenses scandal – from which he emerged largely unscathed – have brought times of doubt.

"There have been moments – as there are in everybody's life – where you think do I really have to put up with this?" he said. "The acrimony, the disdain and mistrust has affected everybody, whether they've been embroiled in this or not.

"And you're bound to feel that, you're bound to think that if severance pay is going after this election why not go? Then you think to yourself that you came into this for a completely different reason, you came in to make a difference and if you can carry on making a difference for the immediate future then that's what I should do."

With a notional majority of more than 18,000, boundary changes should make the new constituency of Sheffield Brightside and Hillsborough even safer than his current seat. Mr Blunkett does not have to worry too much about being kicked out, but his campaign will have the added ingredient of a challenge from the British National Party.

"They've always seen me as a hate figure for me, partly because of my stance in speaking out for the white working class and they hate that most of all actually," he said, admitting it will be a "much livelier" campaign. "I think you've got to take them on in what I would call hand-to-hand street fighting," he said, insisting mainstream politicians have to show they are in tune with people's concerns and he must prove that Labour action has made a difference.