UK economy is turning corner, George Osborne says


George Osborne: "There are still those calling for the government to abandon its economic plan... but to do so would be disastrous"

The UK economy is "turning a corner", Chancellor George Osborne has said in a speech in London.

Mr Osborne cited "tentative signs of a balanced, broad based and sustainable recovery", but stressed it was still the "early stages" and "plenty of risks" remained.

Mr Osborne said that recent months - which have seen more upbeat reports on the economy - had "decisively ended" questions about his economic policy.

Labour has dismissed the comments.

The speech comes ahead of the Conservative Party conference later this month, and after a number of forecasts and surveys pointed to an acceleration in the UK's economic recovery.

Revised gross domestic product figures showed the UK economy grew by 0.7% in the second quarter of the year, with predictions it could reach 1% for the third quarter.

And last week the OECD economic agency sharply increased its growth forecast for the UK economy this year to 1.5% from an earlier estimate of 0.8%.

The Conservatives' fear is that in future voters may not accept that current policies need to be maintained

Mr Osborne said: "The economic collapse was even worse than we thought. Repairing it will take even longer than we hoped.

"But we held our nerve when many told us to abandon our plan. And as a result, thanks to the efforts and sacrifices of the British people, Britain is turning a corner.

"Of course, many risks remain. These are still the early stages of recovery. But we mustn't go back to square one. We mustn't lose what the British people have achieved.

"This is a hard, difficult road we have been following. But it is the only way to deliver a sustained, lasting improvement in the living standards of the British people."

The government's "economic plan is the right response to Britain's macroeconomic imbalances and the evidence shows that it is working", he said, in his address to an audience of academics, think tanks and businesses.

Start Quote

Those in favour of a Plan B have lost the argument”

End Quote George Osborne

Mr Osborne said that those who advocated an alternative economic path could not explain recent improvements in the economic data.

And "the last few months have decisively ended" the idea that the scale and pace of his measures were to blame for much slower than projected growth over recent years, he added.

"Those in favour of a Plan B have lost the argument," he said.

Heeding calls to abandon the government's economic plan in order to spend and borrow more would have undermined the recovery and "would be disastrous" now, Mr Osborne said.

He pledged to remain "vigilant" to threats from abroad - including growing instability in the Middle East pushing up the oil price and a fresh eurozone crisis - as well as at home.

John Cridland, director-general of business lobby group CBI, said the economy was gathering some momentum, business confidence was rising and he expected growth to continue into next year.

"We have always said that deficit reduction should be at the top of the government's 'to-do list', but it must be coupled with an unrelenting focus on growth-boosting measures like infrastructure projects," he said.

'Rewrite history'

Start Quote

The chancellor isn't declaring victory on the recovery just yet - he's too careful for that. But he is declaring victory over Ed Balls”

End Quote

And he dismissed claims he was encouraging "the wrong sort of growth" - led by debt-fuelled consumer spending - insisting the evidence suggested "tentative signs of a balanced, broad based and sustainable recovery".

He said there were many tough decisions still to be taken and that "the only sustainable path to prosperity is to reject the old quick fixes and stick to the course we have set".

Labour accused Mr Osborne of "extraordinary complacency".

Opposition leader Ed Miliband told the BBC that the chancellor was "saying to people that he has saved the British economy at a time when, for ordinary families, life is getting worse".

"If ever you wanted proof that the government is out of touch with most people, that it is on the side of the few, George Osborne has provided it today," he added.


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  • rate this

    Comment number 111.

    Any chance of some of what your smoking George?
    You are certainly on another Planet to the majority of us.
    There is 'growth' in poverty and the Cotswolds.
    The UK economy is 'turning a corner', but going right round the bend...

  • rate this

    Comment number 110.

    I would say 90% of the people I know who graduated post 2008 are in jobs which has nothing to do with their degree or what they actually want to do....

    That's not progress that's desperation.

  • rate this

    Comment number 109.

    Until every food bank in this country is no longer needed I won't believe a word this odious man says.

  • rate this

    Comment number 108.

    # The_Stewey, you missed out the important one!

    Have millionaires had a large tax decrease? ... yes!

  • rate this

    Comment number 107.

    I am unemployed. I have a criminal record. I'm not good looking.

    The future does not look very bright from where I'm sitting, George Gideon Oliver Osborne.

    Visiting the dole office is 'soul destroying'. I can work tomorrow, but who will give me a second chance? That's right, no one.

    Welcome to the 'Rehabilitation Revolution'......

  • rate this

    Comment number 106.

    I'm 77, technically retired but still work 4-5 hours a day. I spend time on here for pure amusement. However, I note people who spend all day everyday on HYS. Are they students, unemployed, wasting time in the office or what? If so wouldn't they be better served improving their lot in life elsewhere? I started a business aged 23 and never looked back. I wish everyone well but it needs effort.

  • rate this

    Comment number 105.

    Not for me and the millions of ordinary people like me, it's not improving. I'm sure for the CEO's, MP's, Bankers & share holders it's been like there's been no downturn, but these people live on different planet to us plebs. Winter's coming & I've still not paid off what I owe for last winters fuel bill. Still, as always I have a choice under the Tories, the other choice being that I can freeze.

  • rate this

    Comment number 104.

    You know what happens when you keep turning corners - you end up back where you started.
    Only if you don't understand that corners turn left as well as right.

  • rate this

    Comment number 103.

    There goes the wind in Labours sails.

  • rate this

    Comment number 102.

    No its not working, its just that the eurozone is growning more. And no it is not sustainable, debt is rising faster than ever, with exports falling further behind imports. It's just another bubble fuelled by printing £375bn fake money, house prices and debt.
    Look at the huge number of new cars on the road, mostly German, bought on borrowed QE money. Just like Greece. Apparently ythis is good?

  • rate this

    Comment number 101.

    "The economy has turned a corner".

    Yeah, straight into a brick wall. Still, we're all in it together, aren't we George - I mean, you MPs have your whopping pay increase to look forward to, the rest of us scrimping and saving to ensure we will eb warm this winter.....between, you, Darling and Brown we've certainly got a loct to be thankful for......

  • rate this

    Comment number 100.

    I think you have stabilised the patient George but it's still in intensive care.

    It would help if the left especially eased off on the slagging Britain off stuff though? Cameron made a good speech in response to being told we were a small insignificant Island last week, and all the media could do was be sarcastic and snigger. Idiots.

    Stop running us down! Confidence is the key to recovery.

  • rate this

    Comment number 99.

    I doubt the 'ordinary family' or anyone who isn't a Banker or a Millionaire would agree. I think 90+% would tell Gideon that he's completely out of touch with normal life and living standards.

  • rate this

    Comment number 98.

    @88. Looternite

    Typical Tory economic management, first drive the economy into a deep recession then claim economic success when things pick up...


    I don't think they were at the wheel in 2008 when the economy was driven into a deep recession but at least you aren't blaming the financial crisis. There is hope.

  • rate this

    Comment number 97.

    I suspect George is using the 'big business' definition of recovery.

    For the average pleb in the street unless there is a sharp fall in inflation followed by a real terms wage rise then the standard of living for most people in Britain will continue its slow decline.

    Meanwhile those who had the wisdom to save for their old age will continue to be punished by punitive low interest rates.

  • rate this

    Comment number 96.

    What a load of tosh! How many times has this man been made to eat his words!? For the majority of us there are no signs of recovery at all, more of our hard earned money is being spent on keeping up with the price of food, petrol, energy bills etc. It sure doesnt feel like we've turned a corner Mr Osborne!

  • Comment number 95.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 94.

    Has the structural deficit gone? ... no

    Has the national debt reduced at all? ... no

    Have living standards increased? ... no

    Has price inflation fallen below income inflation? ... no

    Are more people in full-time work? ... no

    What is this corner we've turned???

  • rate this

    Comment number 93.

    'The economy is turning a corner' .... mmmmmmm

    With diminishing resources insufficient to sustain current let alone increasing demand, growth is turning a corner ... mmmmmmm

    Something doesn't make sense here ..... !!!!!

    I must have gone to the wrong school/college/university.

  • rate this

    Comment number 92.

    It's a false bubble which will burst. Imo, it's driven by the Gov's drive to help first time buyers.
    We've recently seen house prices rocketing up.
    Interest rates will follow as will inflation.
    Osbourne is creating his own sub prime disaster in the waiting.


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