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
    +4

    Comment number 291.

    The REAL CRISIS is the NHS - the ex- NHS George Elliott Hospital in Nuneaton North Warwickshire looks set to be privatised due to the failures that the Tories have let happen - just like the ex- NHS hospital in Cambridge - now under private ownership. Syria and the Osbourne growth story - smoke screens....

  • rate this
    -1

    Comment number 290.

    I agree. I've seen a lot of new jobs cropping up and people moving between companies now because they have more confidence in their job staying secure.

    Most of my colleagues and friends + family I speak to say things have improved a lot this past year.

    Either that or we're just adjusting to horrible way of life!

  • rate this
    -1

    Comment number 289.

    His emphsis is care on an improving path from austerity not what Milliband is trying to distort for his own reasons as he in in deep kimpshie with the TUC and has to face them tomorrow! WE still have aways to go..

    No more flatlining from Balls eh, by the way were is he ?

    Remember Labour's leaving Treasury note "No money left" ?

  • rate this
    -1

    Comment number 288.

    272, totally agree. I hope people remember the post it left by the Labour treasury when it comes to election time.

  • rate this
    -6

    Comment number 287.

    Those calling for a government change forget the mess labour left us in, if still in power unions would thrive debt issues would be on the scale of Greece and hate to think what our credit rating would be. But at least if they ever get back in you can be assured of lots of public sector work and looking after there TUC buddies, whilst taxing small businesses to death and driving away The City.

  • rate this
    +1

    Comment number 286.

    277.BRD - OK. If it's so bad why do Poles, Czechs and others arrive here & find work so easily?

    Could possibly be because there economy is even worse!

  • rate this
    +3

    Comment number 285.

    President Hoover stated " Prosperity is just around the corner" - we all know how that panned out. It is prosperity for the few but for the majority of us it is austerity and more austerityand soup kitchens and Wonga and unemployment and low pay and long hours and no future and stake in society.

  • rate this
    +2

    Comment number 284.

    @ 266:

    "The fact that people expect they are worth more despite being useless shows us how deluded people are."

    Presumably you're referring to Mr. Osborne?

  • rate this
    +2

    Comment number 283.

    It's all about believing things are improving as recessions and recoveries are largely self-fulfilling. If companies believe things are improving they will invest and employ people. Likewise consumers will feel more confident and start to spend more.

    So let’s all try and be more positive so hopefully things will start to improve.

  • rate this
    +3

    Comment number 282.

    @75.
    voiceofreason


    Signs are there that business is recovering our orders are up and customers appear to be more positive about the economy and making plans to invest.

    Totally disagree,companies are sitting on 800 Billion in cash reserves not knowing what to do with it, hence shareholders are being given a bonus, most of it squirreled away in tax havens and not spent in the UK economy

  • rate this
    +3

    Comment number 281.

    247.Epicurus
    The self-entitled eejits are out in force again. We have a government that listens in not taking us into another illegal war..
    -
    Not for the want of trying, total c*ck up from their perspective, they so wanted to be the poodle and go to war. Have you listened to "big man" Hague the past few days??

    If you believe the current BS, I think we can figure out who the "eejit" is!!

  • rate this
    +2

    Comment number 280.

    Roll on May 2015 when we can get rid of Dave, Gideon, the ginger idiot and liar Clegg. They have never had the best interest of the majority of the population in mind, they have been focused on making sure they get their non exec jobs and book deals when we have shown this shower the door

  • rate this
    +4

    Comment number 279.

    When Dim George wakes up he will have a headache.
    He must be joking wages have actually fallen by 5% since he has been in power.
    It is high time that he and the rest of Cameron's motley crew gave up.
    They are pathetic.

  • rate this
    +1

    Comment number 278.

    I've heard people say the government want to return to Victorian values. Well, it's doing that alright, it's quite possibly the worse government the UK has seen in the last 200 years.

    If you put people first and invest in them the people will repay you. If you punish people like this lot are doing your days in government are numbered.

  • rate this
    -1

    Comment number 277.

    OK. If it's so bad why do Poles, Czechs and others arrive here & find work so easily? Saying they accept less just isn't true. I've paid more per hour or job because of better quality or service. This will be heavily marked down but people need to answer this question. Whilst we have 2.6m unemployed there are also 500,000 plus vacancies and businesses are going overseas to recruit.

  • rate this
    -2

    Comment number 276.

    I suppose that if you keep repeating the mantra ‘the economy has turned the corner’ you’re bound to be proved right eventually. However, we’re starting from a dismally low base: the current level of GDP is still lower than it was 5 years ago and some 14% below its trend level. There’s an awful lot of ground still to be made up before we can talk about a meaningful economic recovery.

  • rate this
    +9

    Comment number 275.

    Concerning wages
    There was a time when the man's wage was enough to ensure a good quality of family life.
    Then you needed the men and women working in the family.
    Then couples took out loans to supplement their wages.
    Now families are struggling to pay their debts off.

    So where next?

  • Comment number 274.

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

  • rate this
    -2

    Comment number 273.

    Let us give thanks for the combined steely determination of Mr Cameron and Mr Osborne, in steering the UK economy into safe waters. Where would we be now with out them? This points clearly to the need for a grateful country to vote Tory in 2015. Perhaps before then the Archbishop of Canterbury should officiate at a richly deserved service of national thanksgiving in St Paul's cathedral.

  • rate this
    -1

    Comment number 272.

    It's quite depressing how many people still vote for Labour. I suppose the spend,spend,spend policy is popular. Doesn't matter where the money comes from! Labour supporters see cutting as bad - surprise surprise.

    The Tories and Lib Dems are far from perfect but they do understand the need to cut spending even if it an unpopular choice. Labour constantly want to spend what they don't have.

 

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