Evidence shows that the Government's austerity programme is working and the UK economy is "turning a corner", Chancellor George Osborne has declared in his most upbeat assessment yet of the country's prospects.
In a foretaste of the political argument Conservatives will use in the 2015 general election campaign, the Chancellor warned that holding to his course is the only way of delivering lasting improvement in living standards. Switching economic policies would be "disastrous", putting at risk the advances achieved by the sacrifices of the past three years, he said.
In a speech at a building site in east London, Mr Osborne said that those - like shadow chancellor Ed Balls - who argued for a Plan B involving more state borrowing and less deep cuts have "lost the argument" because they were unable to explain the recovery of the past few months.
And he warned of the need to make "many billions" more in savings after the next election, cautioning Labour that "anyone who thinks those decisions can be ducked is not fit for Government".
In a direct challenge to Labour's decision to put cost-of-living issues at the centre of its agenda in the run-up to the election, Mr Osborne said that Britain was poorer today because of economic decisions taken by the previous government and warned that Plan B would "add hugely to the cost of living".
"Just as our economy recovers and the British people's efforts start to pay off - now is not the time to put all that at risk, and I will not do that to this country," he said. "We have laid the foundations. We have built on top of them. But we cannot stop now. We have got to finish the job. And we will."
Labour accused the Chancellor of a "desperate attempt to rewrite history". "Three wasted years of flatlining under George Osborne have left ordinary families worse off and caused long-term damage to our economy," shadow Treasury minister Chris Leslie said. "This desperate attempt to rewrite history will not wash when on every test he set himself, this Chancellor's Plan A has badly failed - on living standards, growth and the deficit."
Labour leader Ed Miliband said: "I think it's extraordinary complacency from the Chancellor. He is actually saying to the British people that he has saved the British economy at a time when, for ordinary families, life is getting worse and living standards are falling."
But Mr Osborne said that the last few months - which have seen growth forecasts revised upwards amid a number of positive indicators - had "decisively ended" questions about his deficit-reduction strategy.
Mr Osborne said: "The message from here to the British people is this: The economic collapse was even worse than we thought. Repairing it will take even longer than we hoped. But we held our nerve when many told us to abandon our plan. And as a result, thanks to the efforts and sacrifices of the British people, Britain is turning a corner.