In a speech in Cardiff later today, the chancellor will say that any “complacency” that the economy has recovered from the 2008 financial crisis must be tackled.
"Anyone who thinks it is mission accomplished with the British economy is making a grave mistake. 2016 is the year we can get down to work and make the lasting changes Britain so badly needs,” he will say.
"Or it’ll be the year we look back at as the beginning of the decline. This year, quite simply, the economy is mission critical.”
Osborne’s speech comes after public sector borrowing for November came in higher than expected, and after the Office for National Statistics downgraded economic growth for both the second and third quarters of 2015.
The chancellor will say that global economic uncertainty, including a slowdown in China and political instability in the Middle East, means the government must stick to its deficit reduction plan, set out in the Spending Review, to reach a surplus by 2019/20.
“The biggest risk is that people think that it’s 'job done',” he is expected to say. “Many in our politics encourage this, irresponsibly suggesting that we can just go back to the bad old ways and spend beyond our means for evermore.
“Today I want to issue this warning: unless we finish the job of fixing the public finances, to get Britain back into the black by finally spending less than we borrow, all of the progress we have made together could still easily be reversed.”
