As Ed Conway has noticed, if you exclude the effects of either Northern Rock asset reclassification or the profits of the SLS from today's public sector borrowing figures, the deficit was actually higher this year than last.
As Ed Conway has noticed, if you exclude the effects of either Northern Rock asset reclassification or the profits of the SLS from today’s public sector borrowing figures, the deficit is actually higher this year than last.
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One Response to “Has the deficit really gone down?”
Ash
The problem for Osborne, surely, is that the same fudges that make it easier to keep the headline borrowing figure down this year also make it harder to keep it down next year. In 2013-14, all these one-off factors are going to drop out of the figures and various deferred items of spending are going to show up. So he could live to regret this ‘narrow escape’; surely it would be politically preferable to see a rise in borrowing in 2012-13 and a fall in 2013-14 rather than the other way around? The 2013-14 figures are, after all, going to be ‘current’ figures for the annual deficit in the run-up to the next election.
Incidentally, I think the flatlining borrowing figures/forecasts – £120bn last year, this year and next year – represent an opportunity for lefties to make a simple case for the plausibility of the proposition that you can ‘borrow less (in the medium/long term) by borrowing more (in the short/medium term)’. It looks highly plausible to me that if we’d borrowed an extra £10bn last year to fund job creation and infrastructure projects and protect people’s incomes through tax credits – so, £130bn total – we might then have been in a position to bring borrowing down to (say) £120bn this year and £110bn next year in the context of modest growth and falling unemployment. The Tories’ cuts and tax rises are manifestly failing to achieve even that very modest rate of deficit reduction; they’re running to stand still.