Ed Balls, the MP for Morley, will warn that "hard times will last longer than all of us hoped" and will pledge that a Labour Government would hold a "zero-based spending review" to look at "every pound spent".
In a speech to the party's autumn conference, the Shadow Chancellor will also argue that the proceeds of selling off 4G mobile phone licences should be used to "kick-start the economy" by building 100,000 affordable homes and a tax break for first-time buyers.
He is expected to tell delegates that his party cannot pledge to reverse coalition spending cuts if it wins power in 2015 or "promise to put everything right straight away".
But he will put pressure on Chancellor George Osborne to ease his austerity programme by using the expected £3-£4 billion windfall from the sell-off next year of the superfast internet spectrum to boost the housing market and construction jobs.
– Ed Balls MP (Labour, Morley)
Because we all know there can be no post-election spending spree, in our first year in government we will hold a zero-based spending review that will look at every pound spent by government. Carefully looking at what the government can and cannot afford, rooting out waste and boosting productivity.