CORUS and the British steel industry should be at the heart of our economy, David Cameron has said.

The Conservative leader, speaking at the party's annual conference in Manchester, said the firm and its Port Talbot plant would be an important part of the economic recovery.

But he said that any form of Government subsidy or protection for the industry was not the right answer.

"Corus is a great British company, employing many thousands of people in our country," he told reporters.

"We want a strong British steel industry, it should be at the heart of our economy and as we look for recovery in the economy and recovery in things like construction, housing, commercial property, the car industry, clearly steel making is a very important part of the whole process.

"I don't believe the right answer is to look for endless routes of Government subsidy and protection, I think the right answer is to get the economy going again, to get entrepreneurial spirits moving again, to make sure business is lightly taxed so that the economy can start to grow and I think a strong steel industry should be at the heart of that."

The chief executive of Corus, a subsidiary of Indian steel giant Tata, asked Gordon Brown for Government aid late last year, but were turned down.

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But the firm's fortunes have looked more positive recently, with an announcement last month that a mothballed furnace at Port Talbot would be restated.

Mr Cameron, who polls suggest is on course to become Prime Minister at the next election, also declined to give his full backing to the plan to create thousands of jobs in South Wales at the St Athan defences training academy.

It is estimated the academy in the Vale of Glamorgan, which will train servicemen and women, will create 2,500 jobs on site as well as construction and support work.

Liberal Democrat Treasury spokesman Vince Cable recently suggested the project, put at £13 billion, was too costly for the current economic climate.

Mr Cameron said: "Everyone wants this to go ahead, every party is committed to making this work, everyone wants to see it happen.

"The training we provide to our military is incredibly important.

"But I think every party also knows that we have to review the costs and the value for money of all the things in public spending programmes and nothing can be exempt from that."

The Tory leader defended his party's policies, as spokesmen used the conference to outline a series of plans to cut public spending.

"I think everybody understands that we have an enormous budget deficit, the country is living beyond its means and we have to deal with this," he said.

"I feel that people in all parts of the country will respect and respond to a party that says 'look, this is going to be difficult and let's talk frankly about this', rather than living in la la land."

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