Angela Merkel prepares for an austerity backlash as key state goes to the polls

Likely defeat in weekend's regional election set to be humbling bodyblow to Chancellor's cuts agenda

More than 20ft high, rubber, inflatable and wobbling, the latest weapon in Chancellor Angela Merkel's relentless austerity drive looks uncannily like a children's bouncy castle. Yet it is currently touring Germany's most populous state ahead of this weekend's key elections which could determine her long-term political future.

Her Christian Democratic party's campaign gimmick for Sunday's poll in North Rhine-Westphalia is a portable blow-up "debt mountain". Outsized €200 and €500 notes protrude from its exterior, which is decorated with hundreds of €1 coins. "The mountain is growing – put a brake on debt now!" proclaims a slogan on top.

With a population of 18 million, North Rhine-Westphalia has more people than Greece. Any poll there is seen as a key test of national voting intentions. And faced with a general election next year, Ms Merkel's conservatives are taking it seriously. They claim that the results of last weekend's elections in France and Greec e have turned the weekend poll into a key test for Ms Merkel and her stability-oriented policies at home and in Europe. They are hoping that North Rhine-Westphalia, which has debts totalling €230bn (£184bn), will become the latest recruit to the cause of Merkel austerity.

"Angela Merkel cannot appear credible and strong if policies that lead to mounting debt are being pursued offensively in Germany's most populous state," insisted the conservative's front runner, Norbert Röttgen, this week.

At a party rally in the cathedral square of the former Ruhr mining town of Gelsenkirchen on Wednesday, the message delivered by Germany's first woman Chancellor to a crowd of 2,000 mostly elderly residents echoed Margaret Thatcher: "It simply comes down to not spending more than you earn!" said Ms Merkel,

Mr Röttgen has appeared at election rallies and proclaimed that any debt-conscious government led by him in the state would ensure that taxpayers' money "will not be poured into bottomless European barrels" or "wasted on French election promises". To help reduce North Rhine-Westphalia's debt he has called for higher studying and nursery costs.

In Gelsenkirchen, a town renowned for having one of the highest unemployment rates in western Germany, their calls for thrift appeared to fall on deaf ears. "We are the richest country in Europe and exports are booming," Norbert Schmal, a retired miner said. "Do we have to cut spending forever?"

Latest opinion polls suggest that North Rhine-Westphalia is in no mood for austerity. Ms Merkel's conservatives trail their main Social Democrat opponents by some seven percentage points.

With the Green party expected to gain around 12 per cent of the vote, a Red-Green alliance of Social Democrats and Greens appears on course. Ms Merkel's conservatives are forecast to return one of their worst results, with 30 per cent.