He said it proves that the Prime Minister’s claim to have put an end to the era of boom and bust was “one of the greatest deceits” ever told to the British public.
He said the Chancellor was going to double national debt to £1trn and was only offering tax breaks at Christmas in exchange for tax increases for life.
He said the pre-Budget report was less of a tax bombshell than a “precision guided missile” timed to collide with the country’s economic recovery and dubbed it “the greatest failure of public policy for a generation”.
Osborne accused the Chancellor of designing a budget based on the political cycle rather than the economic cycle by storing up tax hikes for the future.
He warned that the £20bn fiscal boost by the Chancellor would be followed by £40bn of tax hikes.
He said the Government’s borrowing figures “are on a scale never before heard in this house” and said the £78bn of borrowing this year is almost double what Alistair Darling forecast eight months ago.
Osborne said the 0.5 per cent rise in National Insurance was confirmation of the final truth:
He said: “In the end all Labour chancellors run out of money and all Labour Government’s run the country to the edge of bankruptcy.
“Stability has gone out of the window. Prudence is dead.”
Liberal Democrat shadow chancellor Vince Cable said the temporary cut in VAT would not be enough to stimulate the economy.
He also said it would reward wealthier people who are the “big spenders”.