You’ve given up on growth and must act, Alistair Darling tells George Osborne

FORMER Labour chancellor Alistair Darling has accused his Tory successor George Osborne of giving up on growth in the UK and urged him to come up with a Plan B.

Mr Darling said in an open letter that Mr Osborne has to come up with “another plan” before “immeasurable” damage is done to the UK. In his letter to Mr Osborne, Mr Darling said that he was sure both men “have Britain’s best interests at heart”.

However, he continues: “But you and the Bank of England seem to have given up on any plan for growth. It’s as if you’re both saying there’s nothing 
you can do and nature must take its course. But the damage that will do to our country is 
immeasurable.” He continued: “You really must act. And act now. Otherwise it will take years to get Britain’s economy growing again to create the jobs we need. The need to get growth going – as the IMF recognises – is desperately urgent.”

Mr Darling goes on to tell Mr Osborne that his first budget forecast is “hopelessly off course” and that his policies since 2010 “simply haven’t worked”.

He suggests “major spending projects” that would see investment in homes, power stations, railways and a third runway at Heathrow Airport. The letter warns Mr Osborne: “You need another plan. Call it ‘Plan B’. Call it whatever you like. But unless you do something now it will be years before we recover.”

Mr Darling adds that Labour would be happy to work with the Chancellor on key issues like social care and welfare reform, citing youth unemployment as a priority.

His criticism follows comments made by Lib Dem Business Secretary Vince Cable, who was being touted by his colleagues as a replacement to Mr Osborne, that another plan is needed to boost growth.

Recent GDP figures show the UK double-dip recession is deepening and the Bank of England has revised its growth predictions for 2012 to close to 0 per cent. Chief Treasury Secretary Danny Alexander has also said that maintaining the UK’s triple-A credit rating is not “the be all and end all” of economic policy.

And the International Monetary Fund has also warned that the UK needs to move away from Mr Osborne’s austerity measures and promote growth.

There was also speculation that Mr Osborne may need to make even more cuts when he unveils his autumn statement because of a low tax take on the year.

The intervention by the man credited with saving Britain during the banking collapse comes at a difficult time for Mr Osborne, with speculation that he could be moved in a ministerial reshuffle. Mr Osborne has pointed out that the international markets have supported his strategy by maintaining the UK’s triple-A status while he has blamed a lack of growth on the problems in the eurozone.

A Treasury spokesman said: “The deficit has fallen by a quarter; inflation has fallen by half; employment is rising, with British businesses creating over 800,000 new jobs; and the economy is rebalancing, with Britain now exporting more to the rest of the world than Europe.”