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George Osborne: Our first task must be to cut the deficit in Britain's finances

We cannot go on with the old economic model of the last decade. A model that depended on: a public spending boom we couldn't afford; an overblown banking sector; and unsustainable consumer borrowing off the back of a housing bubble.

These were the shaky foundations of the age of irresponsibility that left Britain so badly exposed to this economic crisis. They cannot be the sources of sustainable growth for the future. We need new sources of growth.

Our new economic model will be built on long-term saving and investment. We want to see a private sector recovery driven by exports and enterprise. And we want government to support this new economic model with a competitive tax system, modern infrastructure like superfast broadband, investment in green technology and lasting education and welfare reform.

From the ashes of the debt boom we will build a saving society. For the first time ever we are asking to be judged against eight clear and transparent "benchmarks for Britain" against which the public can judge the success or failure of their Chancellor and their government over the next Parliament.

First, we will ensure macroeconomic stability. Today, for the first time in our history, Britain's credit rating is under threat. Indeed, some commentators think a downgrade is inevitable. That would mean higher interest rates on our national debt and throughout our economy and could tip us back into recession, with more jobs lost and more businesses going under.

That's why our first benchmark is to cut the deficit more quickly to safeguard Britain's credit rating. I know that we are taking a political gamble to set this up as a measure of success. Protecting the credit rating will not be easy. The largest bond investor in the world thinks there is an 80 per cent chance of a downgrade. But the economic risk of not setting ourselves this benchmark is not one that I am willing take.

So we will set out a plan in our first budget to eliminate a large part of the structural deficit in the first Parliament. We will make a start in 2010.

The pace of fiscal consolidation will be co-ordinated with monetary policy. And we will protect Britain's credit rating and international reputation.

Taken from a speech by the Shadow Chancellor yesterday