Osborne pledges Budget for jobs

But he left no doubt that he will resist Labour calls to scale back the pace of deficit reduction, saying: “That’s not going to happen.”

Mr Osborne confirmed he will raise income tax thresholds in real terms on Wednesday, amid reports that he may take all those earning under £8,000 out of the tax altogether.

And he gave a strong hint that he will postpone the 1p rise in fuel duty scheduled for April 1 in order to relieve pressure on motorists struggling with prices at the pump of £1.30 or more.

But asked on BBC1’s Andrew Marr Show whether he will rein in the cuts programme, as Labour has demanded, the Chancellor replied: “That would be a huge mistake for the country.

“We would lose economic stability, we would be back in the mess of wondering what is going to happen tomorrow to Britain’s credit rating. That’s not going to happen.”

Mr Osborne said that the necessary cuts and tax rises were all included in last year’s emergency Budget, leaving him free this year to concentrate on growth and jobs.

“Having undertaken the rescue mission last year, I don’t have to come back and ask for more this year,” he said.

“So I can say in the Budget this week I am not going to be asking for more tax increases or more spending cuts.

“We have asked what is required of the British people in last year’s Budget and that enables us in this year’s Budget to move on to putting in place the policies that will help Britain compete, help Britain create jobs and growth in the future.”

Mr Osborne confirmed that this will involve a large boost in apprenticeships and work experience schemes for young unemployed people, and said that he would expand university technical colleges to provide vocational skills.

Asked whether he will be able to postpone the implementation of the fuel duty rise contained in the final budget of his Labour predecessor Alistair Darling, Mr Osborne said: “Of course I am looking very carefully at that to see if I can afford to do something.”

On tax thresholds, he confirmed: “We are going to be able to make a further advance on that. I am absolutely committed to a real increase in personal tax allowances each and every year.”

Mr Osborne said that the March 23 Budget will address the “long-standing and deep-seated problems” which have affected Britain – such as the shortage of training for technical and engineering work – and deliver “far-reaching reforms to equip Britain for the future”.

But Shadow Chancellor Ed Balls said that Mr Osborne’s determination to eliminate the deficit within four years – rather than halve it, as Labour advocates – was to blame for rising unemployment and slowing growth.

Mr Balls told the Andrew Marr Show: “George Osborne’s plan is not working, we are not getting the jobs and growth we need to get the deficit down and deal with the competitive challenges.

“The question for the Budget, for George Osborne, is what will he actually do to get jobs and growth into our economy? So far, we have seen precious little.”

He added: “What’s happening in our economy now is because of his decisions to go too deep, too fast.”

Last year’s Budget included an increase in the income tax threshold from £6,475 to £7,475, following the coalition agreement commitment to move towards the £10,000 level promised in the Liberal Democrat manifesto.