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
    +9

    Comment number 531.

    Finally! Phew I think I will splash out on a new duck island for my moat now the pressure is off a bit...

  • rate this
    +4

    Comment number 530.

    we may be seeing some growth but no thanks to the crooks in parliament. Its the hard graft of the British people that politicians exploit as their soap box after shamelessly selling the lower classes into wage slavery. Everything the coalition has attempted has taken such a human cost that I dont recognise any more this mean spirited ultra conformist nation we call the UK.

  • rate this
    +1

    Comment number 529.

    The dark side surrounds us, the financial future, hard to tell with tory spin.
    Dizzy we all are but, we do not realize it.

  • rate this
    +2

    Comment number 528.

    Chris (510)... Actually Brown simply continued the dive that started with the City's Big Bang back in the 80s. Politicians of both ruling parties have signally failed to understand the problem so they are helpless to provide solutions. At least there's a growing campaign talking sense now.... Positive Money.

  • rate this
    +6

    Comment number 527.

    I think anyone who is encouraged by the big picture of what is happening must be mentally deranged and the last place he should be is in any position of power and influence.

    George just go home to your padded cell.

  • rate this
    +5

    Comment number 526.

    You are missing a trick George

    Why not claim credit for the growth all other G7 countries are showing at the same time as well?

    Maybe thats not such a good idea ... I mean arent all the economies back to 2008 levels ? Oh thats right all EXCEPT the UK & Italy. Also dont we have the 2nd worst export figures of all the G7 too? surely worth shouting about?

    Thats the credit you deserve

  • rate this
    +4

    Comment number 525.

    I guess the housing bubble that the government is creating by its funding for lending scheme makes the economy look better than it is. As far as I can see things are still as bad as they were at the start of recession.

  • rate this
    -7

    Comment number 524.

    505 Tim

    'Time is running out for the boys in blue the election is comming and it will be bye bye torys.'

    Time was when I thought the Tories were on a hiding to nothing thanks to the economic basket case bequeathed by the wicked and incompetent Brown. But, astonishingly, Osborne has avoided a double dip and appears to have engineered growth in time for the election.

    No wonder Labour a worried.

  • rate this
    +1

    Comment number 523.

    70 - Turning a corner doesn't mean ALL will benefit , in fact it will be the top 20% who will benefit most . One thing we do know is Labour would add no value at all . The £1,200 billion public debt is still going up , so yes even more spending cuts will be required in the next 10 years - regardless of who is in power , a fact Millband forgets to mention to his TUC mates

  • rate this
    0

    Comment number 522.

    487 plotinus
    Agreed!
    "Why are we heralding 1.5% projected annual growth when our economy has fallen over 10% in the last 5 years"?
    Yes,from the same talk-it-up economics school as your boss saying here's your 2% pay rise after 5 years of cuts or a freeze at best,George & your boss just count the year of the positive not the 5/10/15/20 years of cuts to pay,pension,and other conditions!!!

  • rate this
    +1

    Comment number 521.

    @388. Poverty is a relative rather than absolute thing. Nobody here endures the poverty of Africa and other such areas. OECD figures show UK poverty at 11.3% of 63.7m or 7.20m versus OECD average of 11.1%.We define poverty as a household income below 60% of the median. Higher than the OECD definition. This currently brings in 14m as you say but it's in the definitions and not absolute.

  • rate this
    +1

    Comment number 520.

    497.jgm2

    Do you ever say anything other than your paranoid obsession with Labour. Go to the pub or something, read a book, you dreary little man.

  • rate this
    -1

    Comment number 519.

    @304.Mr Arthur Cook

    ..and after Labour Bankrupted the country, do you really believe that Labour would have done any better in a European and World Wide Recession... this is NOT about blaming a Government, we need to look much closer to home about what people spend their money on... I am sick to death of hearing about how badly off we are - we have a better standard of living than ever before.

  • rate this
    +50

    Comment number 518.

    If we are turning a corner, which corner. Some homeowners in London may be better off. I'd be interested to hear from Mr Osborne how exactly has his austerity has had a positive impact.
    Wages are being held low, while energy and housing prices are on the increase. Ask an unemployed 19 year old in Merthyr Tydfil, Middlesbrough, Motherwell or Wigan if they're feeling better off. I doubt it.

  • rate this
    -1

    Comment number 517.

    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” Stephanie Flanders, BBC Economics Editor. Bearing in mind the strength of opinions on this comments board I wonder if a more critical editorial is needed. Equally, I wonder if the mainstream media are too compliant to political agendas rather than rock the boat.

  • rate this
    -1

    Comment number 516.

    IS " ImTalkingToYou " Dave Cameron he is the only person I know who would play with George

  • rate this
    -9

    Comment number 515.

    The critics of austerity should now accept they have lost the argument. Ed Balls in particular got it spectacularly wrong.

    Even the OECD increased its growth forecast for the UK economy this year to 1.5% from an earlier estimate of 0.8%.

    But in response what do we hear from the TUC - let's strike.

  • rate this
    +4

    Comment number 514.

    All your city mates nicely topped up with champers George?


    Top ho! We jolly well have turned that corner then.


    Let's not mention the billions of pounds of taxpayers' money and lost jobs that have occurred as a result of bankers' greed.

  • rate this
    +1

    Comment number 513.

    Can't say I've ever seen Osborne or Cameron in our local charity shop ,going through the racks of used clothes or shoes, looking for a bargain, or looking for something for the kids at school
    As my old Gran used to say" There is No such thing as second hand clothes"..."They have only been tested by someone to see if they work"

  • rate this
    +5

    Comment number 512.

    Wouldn't you just like to wipe that smirk off his face?

 

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