Osborne: Darling in deficit 'denial'

The Tories warned today that Alistair Darling was "in complete denial" over Britain's deficit.

Shadow chancellor George Osborne lashed out after Mr Darling urged fellow G20 countries to maintain their massive public spending programmes to stop the world from slipping back into recession.

Mr Darling said that there was a danger of a "double dip" downturn if the world's leading nations began to pull out of stimulus packages agreed earlier this year.

Germany and France, which are no longer in a recession, now want a cut in spending.

But the Chancellor said it was too early to think about "exit strategies".

He told the Independent: "You must have a plan that allows you to exit in a way that is consistent with allowing the economy to grow again."

However, Mr Osborne said that it was bizarre that the UK was encouraging other countries to follow Britain into maintaining a massive deficit.

"While the rest of the world is facing up to the need to deal with their budget deficits, the British Government is still in complete denial despite having the largest deficit," he said.

"There's a fundamental contradiction at the heart of Alistair Darling's argument.

"He says that he expects, as we all do, that Britain will come out of recession this year and yet he wants to go on with large increases in public spending next year, when he knows the country cannot afford it."