A senior Conservative MP has attacked the government's plans for growth as inconsistent and incoherent on the eve of the Conservative Party conference.
Andrew Tyrie, the chairman of the Commons Treasury committee, told the Times that despite talk of the need to tighten its belt, the government had not come to terms with the true state of the economy.
He said the current policy agenda mistakenly reflected the "priorities of the middle of the past decade, when David Cameron expected to inherit at least acceptable economic conditions".
"The Big Society; localism; the green strategy - whether right or wrong; these and other initiatives have seemed at best irrelevant to the task in hand, if not downright contradictory to it; likewise the huge spending hike on overseas aid and the cost of the Libyan expedition," he said.
"But the age of abundance has been replaced by the age of austerity. Current policy does not recognise that face."
"There is much to do, and it is not just a question of gaps in policy," he said. "A coherent and credible plan for the long-term economic growth rate of the UK economy is needed."
He said that while he supported the government's immediate plan to tackle the debt crisis it had a "long way to arrive at a coherent strategy" and that "in places it is inconsistent, even incoherent".
Shadow Treasury minister Chris Leslie said George Osborne should heed Tyrie's warning.
“With unemployment rising again and the recovery choked off last autumn, the Conservative chair of the Treasury select committee is right to say that the government does not have a credible and coherent plan for economic growth," he said.
“It’s time the Chancellor started listening to people like Andrew Tyrie, as well as the CBI and Federation of Small Businesses who have also warned in the last few days that the government needs to do more."
Tyrie's criticism comes on the eve of the Conservative Party conference in Manchester where the economy is likely to dominate proceedings.
In an interview with the Daily Telegraph Osborne said the coalition was doing "everything it could to stimulate growth in the economy but appeared to rule out tax cuts in the near future.
"My first priority is to deal with the deficit. I don't want to be a Chancellor who cuts taxes one year and has to put them up the next," he said.
"A country with an almost double-digit deficit cannot add to its deficit in the middle of a sovereign debt storm to cut tax, presumably on a temporary basis, because you would have to then put it back up again to deal with the deficit. Tax cuts should be for life, not just for Christmas."
He added: "We have plenty of economic issues to discuss -- we've got the situation in the eurozone, the situation in the world economy. We are doing everything we can to get the British economy moving. That is where my energy is spent."
Osborne will use the conference to announce plans to change employment law so workers can only sue companies for unfair dismissal after two years rather than 12 months.