The Chancellor will warn that many risks remain and that "these are still the early stages of recovery" but will say that the British economy is "turning a corner".
His speech will be widely seen as a challenge to the Labour party which has long advocated a Plan B, of using investment to boost growth.
Last week, Labour's shadow chancellor Ed Balls was forced into what was interpreted as a grudging admission that the UK was on the road to recovery.
Coalition ministers have been buoyed by a series of positive economic markers. They also believe that the economy, and who claims ownership of the turnaround, will help decide the outcome of the next general election.
In a direct challenge to Labour, Mr Osborne will say the past few months have "decisively ended [the] controversy" about fiscal policy. He will say that heeding calls to abandon the Government's economic plan in order to spend and borrow more would have undermined the recovery.
His speech will also outline why ministers believe that, although many risks still remain, the emerging recovery is sustainable.
While there are tough decisions still to be taken, "the only sustainable path to prosperity is to reject the old quick fixes and stick to the course we have set", he claims. He will say: "In my view, the last few months have decisively ended this controversy in favour of this "financial conditions" story of the past three years.
"Those in favour of a Plan B have lost the argument."
"Our recovery from the Great Recession would have been undermined. The impact on living standards would have been much harsher."