Growth in the private sector is outpacing the loss of public sector jobs, Conservative MP Tony Baldry told Chancellor George Osborne.

The north Oxfordshire MP spoke as the Coalition and Labour clashed over the state of the economy in Parliament on Tuesday.

He asked if Mr Osborne had “noticed that the most recent figures from the Office for National Statistics show that employment is up by 311,000, the biggest quarterly increase since the General Election”.

He added: “Does not that mean that since the General Election two jobs in the private sector have been created for every job lost in the public sector?”

Mr Osborne said: “Despite these very difficult and challenging economic times, the private sector is creating jobs.”

But Labour MP Chris Williamson said: “Youth unemployment is at record levels, poverty is on the increase and public services are in meltdown.”