The Tories are finally starting to get the point.
He said that he and David Cameron, the Conservative leader, had agreed that curbing the growth of the state, rather than raising taxes, would be their guiding principle for economic recovery.
The trouble is, Labour is already set to announce something similar at the Budget - although without the tax bit - so any "clear blue water" between the parties is likely to be short lived. I have to admit that I think Osborne and Cameron are deluding themselves if they are suggesting that taxes won't have to go up.
To be fair to them, I don't think they are saying that - just emphasising the point that cutting spending has to be the priority. What concerns me more is this bit.
"I've mentally adjusted myself, and David Cameron, has mentally adjusted himself, to the fact that we are going to have to take some very difficult decisions for the good of the country," Mr Osborne said.
Eh? You're politicians for chrissakes - you shouldn't need to "mentally adjust" yourself to the possibility that you might have to make tough decisions - that should be a prerequisite of being a politician. Of course you are going to have to make tough decisions!
Osborne also intends to face the subject of public sector pensions ...... I'll believe that when I see it ... and has placed education reform at the top of their list. Yeah, right! We've heard that one before, mate. Their idea of reform is tinkering around at the edges of the failed comprehensive experiment - nothing fundamental will change.
I actually find it quite amusing to see the Tories scrabbling around trying to come up with something to distance themselves from Labour now. Just a few short years ago we had Cameron taking over and turning the Conservative party into a clone of New Labour - and now the facade of the New Labour revolution has come tumbling down, we're now watching the Tories backsliding as they try to seem more like .. .well, conservatives!
You should have stuck to your principles, guys. Conservatism works - always has and always will. Yeah, you get little blips and upsets from time to time, but the principles are sound and proven and you should have known that.
We might live in a technologically advanced world and hugely altered society, but nothing has really changed. You still can't build a house without foundations.