Speaking in the House of Commons after the OBR upped GDP growth for 2010 to 1.8%, Osborne said the country was “out of the danger-zone” and set on a path of sustainable growth.
“When we came into office Britain was in the financial danger zone,” he told MPs. “Our economy was unstable, our public finances out of control, our country on the international watch-list to avoid.
“Now the independent OBR have confirmed the British recovery is on track, our public finances are under control, a million jobs are set to be created, and our economy is rebalancing.”
The message from the independent body, he said, is Britain’s economic recovery is “the mend”, with job creation, a falling deficit and sustainable economic growth of over 2% for each of the next five years.
Referring to the coalition’s deficit-cutting programme, he said the government was “absolutely right” to take the UK out of the financial danger-zone which saw it rocked by the greatest recession since the war and the “biggest banking crisis of our lifetimes”.
In a dig at the opposition bench, he said: “Britain is on course both to grow the economy and balance the books – something some people repeatedly said would not happen.”
The chancellor also aid the OBR’s projections had shown the UK stands on firmer economic ground than many of its counterparts with the country set to grow faster than Germany, France, Japan and the US over the next two years.
The UK’s growth will also outstrip the average rate of the eurozone and the EU, he added.
Pointing to the OBR’s revised growth forecast of 1.8% – up from 1.2% in June – he said the country’s financial health had improved substantially over the past few months. Borrowing this year is expected to be £1bn less than forecast in June, he said.
In addition, he said OBR figures show the government’s plan to eliminate the structural deficit will be completed one year ahead of schedule, in 2014-15.
Osborne added the independent body’s figures also suggest the UK’s economy is rebalancing from one dependent upon debt to one built on growth and exports.
He went on to set out a new model of sustainable economic growth for the country through encouraging business and foreign investment.
Part of this rebalancing agenda will see a greater effort to increase the economic competitiveness of Britain after a decade of decline, the Chancellor said.
A key plank of this strategy will see the government publish the most significant programme of corporate tax reforms for a generation, he said.
“We propose to make the UK an even more attractive location for international business and investment, by reforming our outdated and complex rules for controlled foreign companies.”
He also confirmed the government will introduce a lower 10% corporate tax rate on profits from newly commercialised patents from April 2013.
In a further sweetener to the business world, Osborne then announced the launch of a cross-government growth review. This, he pledged, will remove the barriers of growth holding Britain back “brick by brick”.
Meanwhile, he said the UK’s loan to Ireland as part of the recently-agreed EU/IMF bailout package will “in principle” amount to £3¼bn and is in Britain’s “best interests”.
He also confirmed the UK will not be part of the EU’s permanent bailout mechanism.
