Britain moving in 'right direction', says Cameron
David Cameron has used his New Year's message to say the UK is "heading in the right direction".
The prime minister said 2012 was "tough" but people can look forward to 2013 with "realism and optimism".
In the video address released on Sunday, he admitted he had "no quick fixes" to the UK's economic problems.
But he said there has been "real progress" on cutting Britain's financial deficit, welfare reform and improving school standards.
End Quote David Cameron British Prime Minister
On all the big issues that matter to Britain, we are heading in the right direction and I have the evidence to prove it”
Meanwhile, a leaked internal memo suggests senior Lib Dems have been urged to spread the message that the Conservatives cannot be trusted to help build a fairer society.
And Labour has responded to David Cameron's New Year message by saying the prime minister had "promised change" but "nothing is changing for the better".
In his message, Mr Cameron said "this is, quite simply, a government in a hurry", adding: "There's a reason for that."
He added: "Britain is in a global race to succeed today. It is a race with countries like China, India and Indonesia; a race for the jobs and opportunities of the future.
"So when people say we can slow down on cutting our debts, we are saying no. We can't win in this world with a great millstone of debt round our necks.
"When people say we've got to stop our welfare reforms because somehow it is cruel to expect people to work, we are saying 'no'. Getting people into good jobs is absolutely vital, not just for them, but for all of us.'Right direction'
"And when there is a fight on our hands to change our schools, we are ready and willing to have it, because having a world-class education is the only way our children are going to get on in this world."
End Quote Michael Dugher Labour party vice chairman
This prime minister is out of touch, he stands up for the wrong people and he's failing to deliver for working people”
Mr Cameron said: "On all the big issues that matter to Britain, we are heading in the right direction and I have the evidence to prove it."
He said that the deficit was forecast to be a quarter smaller at the New Year than it was when the coalition government came to office; that there are almost half a million more people in work; and more than 1,000 new academy schools have opened.
He also hailed moves to take millions of low-paid workers out of income tax, freeze council tax bills and deliver the largest-ever increase in the state pension.
Mr Cameron avoided the issues of Britain's future in the European Union - which he is due to give a speech about in the coming weeks - and gay marriage, both of which have caused divisions within the Conservative Party.Lib Dem memo
Instead, the prime minister said he looked back on 2012 as "an extraordinary year for our country", characterised by the Diamond Jubilee celebrations and the successful Olympics and Paralympics.
Meanwhile a leaked internal memo suggested Lib Dems are being encouraged to criticise their Tory coalition partners as well as the Labour opposition.
The memo from the party's head office to its MPs, peers and staff says they should criticise not just the Labour opposition but their Conservative coalition partners in the year ahead.
The memo suggests voters should be reminded that the Tories wanted to "look after the super rich".
And Michael Dugher, Labour's vice chairman, said the prime minister's message was "a case of more of the same".
He said: "Cameron promised change but nothing is changing for the better. Britain's economy is failing under his policies over the last year, with nearly one million young people out of work.
"Prices are still going up faster than wages and borrowing is going up not down, over 7% higher this year than last year.
"This prime minister is out of touch, he stands up for the wrong people and he's failing to deliver for working people."