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 1031.

    Poor George. Blind leading the Blind!

  • rate this

    Comment number 1030.

    203. ImTalkingToYou
    "There seem to be many more jobs available on the market than there were 6 months ago"

    Perhaps there are, but are you actually looking for one? If so, you'll find many are these "zero-hour" contracts, or low waged. Jobs in my industry are now offering salaries £10-15k less than I was earning in 2000. Looks more like we're going downhill to me, not turning any corners.

  • rate this

    Comment number 1029.

    1016. BLACK_PEARL

    You have advantage of years on me - dont remember '70s. but I remember the '80s / 90's - sell offs, 15% interest rates, black Wednesday? 42% GDP debt? Actually worse than recent Labour


    Written by a tory supporter, I guess he's one of the very few to whom truth is actually important

  • rate this

    Comment number 1028.

    Remind me what party paid for a van to go around North London last month with a billboard citing an old 70's National Front Slogan ?
    You know, anyone can play that game...Skiping over bits of History that doesn't suit your own political vernacular.
    Now I know the right wing are still sore from the EDL's pathetic turnout a couple of days ago.But that's weak.

  • rate this

    Comment number 1027.

    They tell us this because we all said there was no money for war on Syria

  • rate this

    Comment number 1026.

    Now remind me, which government was it that sold our gold reserve at a all time low, raided everyone's pension so no final salary was possible, borrowed more than most other countries, invested nothing in industry, gave work away when it could have stayed here, opened the doors for millions causing massive pressure on the NHS & other services & said, "No More Boom and Bust!"? Answer Labour!

  • rate this

    Comment number 1025.

    People say Politics has stagnated, The whole of our Culture has turned green with algae....

    Neo-Dark Ages!

  • rate this

    Comment number 1024.

    996. Its in the very very small print on ballot papers. Just under the clause "Put your "X" here mug."

  • rate this

    Comment number 1023.

    What can one say?
    Just one more bankrupt speech from a bankrupt government.
    If I were a millionaire,I too could turn any corner you can name.
    Grow up Osborne and come into the real world,no wonder other world leaders are laughing at us.

  • rate this

    Comment number 1022.

    Labours moans are transparent and politically motivated. Ed Milliband and his party will stop at nothing to discredit a very reasonable economic policy. If Labour would have been in power over the last few years Britain would play in the same economic league as Greece, Spain and Italy.

  • rate this

    Comment number 1021.

    I can't believe people still argue over the pro's and con's of the respective political parties. They all have appalling track records one way or another.

    Political parties must be one of the few areas in life where if something's bad its still endorsed. New gadgets demanded all the time but thing that rule our lives, totally stagnant.

    Quite amazing really.

  • rate this

    Comment number 1020.

    This must be a class thing! Having Horse muck in your eyes.
    Chin chin!

  • rate this

    Comment number 1019.

    If I had to chose who I trusted most as between Huhne and S Times it would have to be the latter. Both untrustworthy but one more than the other.

  • rate this

    Comment number 1018.

    Turning the corner? I thought it was going around the bend!

  • rate this

    Comment number 1017.

    Acts will get my vote. No words, tired of the lies. Like Eds shake up, keep people on their toes. My old boss used to sweep the floor in his suit after getting out of a Jag. Have a chat with you, and always see you right. You get a slave trader now, watch old films of back in the day.....we are THERE people. Please Sir, can i have some more. Garbage. If i had a pitchfork ooh. Bring on ED MILIBAND

  • rate this

    Comment number 1016.

    Dont know how old you are sprout but I've lived though the carnage left by long term Labour Govts. 22% + inflation in the 70's followed by 15.4% corrective interest rates on my mortgage. Now following another, corrective NO interest on my savings (pension)
    They always run out of everyone elses money
    Like it are not they ARE a Kiss of Death. Its in their DNA

  • rate this

    Comment number 1015.

    It's turning a corner, just like H2S in Tatton. For Mr Osborne, austerity is soemthing that happens to people he doesn't really know. For his freinds and the parties financial backers, things have stayed pretty good.

  • rate this

    Comment number 1014.

    I think that cheap labour in the form Of Gordon Brown's 1999 minimum wage is driving this 'recovery'.
    His admiral idea was to increase the wages of the poorly underpaid, who would disagree with that. Now the underpaid are slaves to the minimum wage and zero hour contracts.

  • rate this

    Comment number 1013.

    The Bank of England will not consider raising interest rates until the unemployment rate has fallen to below 7%

    BOE better start telling us the true amount of unemployed then?

  • rate this

    Comment number 1012.

    problem was with capitalism itself, here and the USA. But if Brown had not bailed out the banks, we would be in a worse state now: he had no choice.
    So why did Gordo Brown lash out all those Knighthoods to his banker mates for doing so a good job to the country ?
    Hell even I could see where the ballistic house prices were going caused by low interest rates which he promoted


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