Osborne defends plans for the economy

George Osborne, the Chancellor of the Exchequer, says that action taken since the coalition was formed and the action it will take in the spending review is putting the country on the road to growth.

George Osborne
George Osborne

Speaking today at the Conservative Party conference in Birmingham, the Chancellor said the £6.2 billion reduction in spending gave Britain a breathing space in the face of the European debt crisis.

He said: “Within 50 days we had restored confidence at home and abroad in Britain’s ability to pay its way in the world with a bold emergency Budget and now we are a fortnight away from completing a fundamental review of public spending that will put this countries finances on a sustainable path for years to come.”

He added: “Every day as Chancellor I see alerts telling me of risks, but we meet here in an atmosphere of relative calm, not raging crisis a measure of what we have achieved over the last five months.”

He also said that Britain had “no divine right to be one of the richest countries in the world” as economic power shifts eastward, adding that skills, infrastructure and education are vital in securing future growth. (article continues below)

“We will do everything we can to make Britain one of the most competitive places in the world to do business,” he said.

He said he wants Britain to be the home of successful financial services but warned banks over lending to businesses.

He said: “Let me make this clear today. We will not allow money to flow unimpeded out of those banks into huge bonuses if that means money is not also flowing out in credit to the small businesses who did nothing to cause this crash and suffered most in it.”

The party should take pride, he said, in having restored the link between pensions and earnings.

The Chancellor announced a cap on the amount of welfare any one family can receive. He said: “Unless they have disabilities to cope with no family should get more from living on benefits than the average family gets from going out to work.”

Osborne responded to critics who say the approach to cuts is symptomatic of an ideological approach by stressing that he believes in public services.

He said: “Modern government exists not just to provide resolute security at home and abroad, but also to provide the best in education and health care and support for the big society this is at the heart of my one nation conservatism.”

“And I believe in fairness, that country is stronger when there is opportunity for all and effort is rewarded and help is given to those in need, that poverty scars us all and that the vulnerable deserve our protection.”

He added: “And I also believe that all this is only possible with an aspirational economy, and entrepreneurial economy a capitalist economy.”

He attacked Ed Miliband’s views on deficit reduction suggesting the new Labour leader and Union leaders had set themselves up against the governor of the Bank of England, credit ratings agencies, business groups, the European Commission, David Miliband and Tony Blair. “The national interest or the vested interest? I know which side we are on,” he said.