Tories 'will make a difference'

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In his keynote conference speech, Mr Osborne said the country's financial system was facing the "most profound questions" due to the credit crunch.

A "divided" Labour Party was "more interested in fighting themselves than in fighting for the future of this country".

People would ask of the Tories: "Are you up to it and will you make a difference. This week we will show them, yes, we are and yes, we will."

His comments came after the Conservatives unveiled a "reconstruction plan" requiring governments to reduce national debt over an economic cycle.

They would set up an independent Office for Budget Responsibility to keep track of the public finances and set out changes to tax and spending plans necessary to slash debt.

Mr Osborne told party supporters that he wasn't going to blame all the economic troubles on the bankers but nor was he going to excuse them of all responsibility.

Mr Osborne said the economy was suffering from a "crisis of confidence" as it faced a "financial storm" and pinned the blame directly on the Prime Minister, who forgot that an economy "built on debt" was not an "economy built to last".

Insisting the party was over, he said: "I am not going to blame everything on the bankers alone but nor am I going to excuse them of their responsibility or allow them to think that things can carry on as before.

"I'm not going to do what the Left has done and use the crisis as an excuse to abandon the free market economy that has made our economy prosperous. Nor do I pretend that the crisis doesn't raise the most profound questions about our financial system and how we regulate it."