Chancellor Alistair Darling has promised his 2010 Budget will be "sensible and workmanlike" with no pre-election giveaways.
Better-than-expected tax and borrowing figures have given the Chancellor more leeway than anticipated - up to £12 billion, according to experts.
But he has said voters expect him to be realistic about the UK's precarious economic recovery and prioritise measures to stimulate growth.
"There is no question of giveaways. The mood of people just now is that they want to see a sensible, workmanlike Budget, a Budget for the times in which we live.
"A Budget for ensuring that we secure the recovery - because we are not out of the woods yet - but, crucially a Budget for the future," he told the BBC.
Recent figures have confirmed the recent recession was the deepest, as well as the longest on record, with a 6.2% peak-to-trough decline.
The economy grew by 0.3% in the final quarter of 2009, although the impact of the winter weather and January's VAT hike could damage prospects for the opening three months of 2010.
But the Chancellor has said he is standing by forecasts of rapid growth next year.
Mr Darling is banking on a 3.5% advance for the UK economy during 2011 as the recovery gathers momentum, but this is well above the 2% forecast by most experts.
Treasury predictions of 1.25% growth this year are in line with the City, although borrowing will almost certainly undershoot the original £178 billion estimate.
As Mr Darling was putting the finishing touches to his Budget, a business group predicted that the UK's economic recovery would not pick up pace until the middle of next year.
The CBI said the end of stimulus measures such as the reduction in VAT and the car scrappage scheme and subdued consumer spending meant the economy would remain fragile in the medium term.
A leading forecaster, the Ernst & Young Item Club, said Mr Darling needed to find another £10 billion through a "credible, detailed and more aggressive plan", the Times reported.
And, adding to the pressure for cuts, official figures were reported to show Government spending now accounted for more than half of the UK economy for the first time.
Statistics from the Organisation for Economic Cooperation and Development (OECD), the Daily Telegraph said, put the figure at 52% of GDP, one of the highest among developed nations.
Mr Darling is not expected to announce any details of planned spending cuts as Labour believes immediate cuts - as advocated by the Tories - would wreck the recovery.
But the Financial Times reported that he would identify which Whitehall departments would bear the brunt of savings from 2011, ahead of a spending review planned for the autumn.
Mr Darling insisted that Labour would not hold a second budget if it won the general election, dismissing Tory claims that this week's set piece would be "window dressing".
The Tories believe faster action is needed to cut the deficit and would hold an emergency Budget within 50 days of taking office, at which they have not ruled out making tax rises.
Shadow chief treasury secretary Phillip Hammond said: "I hope Alistair Darling will set out a Budget which is prudent, a Budget for growth in Britain. But the real issue is whether Alistair Darling's Budget counts for much.
"We don't know whether Labour would hold another Budget after the election so this may just be a piece of window dressing we get on Wednesday."
But Mr Darling insisted there would be no such second budget if Labour defied the polls and secured a fourth term at the election - expected to be on May 6.
There would be a Departmental spending review this year, he said. "but the two events - the Budget, the Pre-Budget Report - that is not going to change."
Other budget measures would be "focused on growth" - notably unlocking private investment - Mr Darling said, with the unemployed also tipped to be offered extra help.
Barclays Capital economist Simon Hayes said the Chancellor had little room for manoeuvre "as he attempts once more to transform a sow's ear into something resembling a silk purse".
Although borrowing could be £15 billion below forecast due to better than expected tax receipts and lower than feared unemployment, he said it was "hard to imagine a less auspicious backdrop" for a pre-election Budget.
"The ratings agencies continue to make disapproving noises about the Government's plans for fiscal consolidation, and sterling has come under renewed pressure," he warned.
Mr Darling is unlikely to set out any further details on where the axe will fall on spending with the poll a matter of weeks away.
"The dire state of the public finances is set to force some painful choices. But with the general election widely expected to be set for May 6, the Labour government is understandably reluctant to be too explicit about the pain to come in future years," ING Bank's James Knightley said.
© 2012 The Press Association Limited
