He promised to make it harder for the government to "fiddle the figures" – after accusing Labour of issuing dubious forecasts.
He said the new Office for Budget Responsibility – designed to keep government spending under the microscope – would create a "rod for my back down the line and for future chancellors. That's the whole point."
Osborne said Labour's forecasts had mostly been wrong and "almost always in the wrong direction".
The coalition has agreed to make £6bn in spending cuts with details to be unveiled next week, the chancellor added.
Lib Dem David Laws, the chief secretary to the Treasury – who was standing shoulder to shoulder with Osborne – said the task ahead was "colossal" and that Labour had left the public finances in an "unacceptable "state.