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Osborne warning of further pain
George Osborne has warned of more "difficult decisions" to come in next week's Budget as he sets out his plans to build a "resilient economy" for the future.
Writing in The Sun on Sunday, the Chancellor confirmed he will use his Commons statement on Wednesday to spell out details of the Government's promised cap on welfare payments.
He made clear that after five years of austerity, the squeeze on the public sector will still have to continue beyond the general election and into the next parliament in order to rebuild the public finances.
While he said that the economy was now "on the mend", Mr Osborne reaffirmed that there would be no deviation from his deficit reduction strategy.
"My Budget next week will set out what we must do to build a resilient economy," he wrote.
"We must not waver from our plan to reduce the budget deficit and deal with Britain's debts. That plan has delivered economic stability and low mortgage rates for families and it has laid the foundations for economic recovery."
However he said the deficit was still to high - which is why public sector workers face another year of pay restraint and welfare spending will be capped from 2015.
"None of these decisions are easy, but the alternatives are worse," he wrote.
He warned that the "single biggest risk" would be to change course just as the current strategy was delivering results.
"We've made huge progress dealing with the debts we inherited, but finishing the job will require further difficult decisions in the next parliament," he said.
"The recovery is under way, but the single biggest risk would be to abandon the long-term economic plan that is working.
"Ed Balls and Ed Miliband haven't learned any lessons from the last time they crashed the British economy.
"The question is simple: Why would you give the keys back to the people who crashed the car?"
For Labour, shadow chancellor Ed Balls accused Mr Osborne of being "out of touch" with the concerns of ordinary voters who had yet to feel any improvement in their standard of living.
"We can all expect George Osborne and David Cameron to try and claim everything is going well. But that's totally out of touch when millions of working people on middle and lower incomes are not feeling any recovery at all," he wrote in an article in the Sunday Mirror.
"Young people stuck on the dole for months on end aren't feeling it. Pensioners seeing their gas and electricity bills go up each year aren't feeling it. Parents facing childcare costs so high it barely adds up to go out to work aren't feeling it.
"People aspiring to own their own home but finding rising prices have put their dreams out of reach aren't feeling it. And nurses who've been told they won't even get the below inflation pay rise they were promised certainly aren't feeling it."