The next phase of the fiscal debate begins now

By Neil O'Brien

We just missed the last chance to have a sensible election debate about public spending.  The Government could have finally told us where the axe is going to fall, and challenged the opposition parties to say how they would have done things differently.

Instead, the Government will now go into the election simply refusing to tell the electorate which items of spending they would cut, or which taxes they will raise. We will be asked to sign a blank cheque.

Today’s Budget doesn’t really deserve a response.  It contains endless micro-policies and political wheezes: all intended to distract from the fact that it does nothing to staunch our ever rising debts.

The budget gives away £1.5 billion now, and says that it will be taken back again after the election. To put things in context, that's just one in every 500 pounds the Government spends.

You can get a sense of how little difference any of this makes from the chart below.  It shows how much debt the government is running up for every family of four people.  In just a few years it will have spiralled from £40,000 to safely over £100,000 a family.  And even that is based on wildly optimistic assumptions about growth - which are not shared by independent forecasters.

Extraordinarily, the opposition have gone further than the Government in setting out where they would reduce spending.  Historically this is very unusual, and there are probably political limits on how much further ahead of the Government they can get, if the Prime Minister simply refuses to treat us like grown-ups.

For too long the fiscal debate has been stuck on the important but narrow issue of timing rather than content.  We have effectively been debating whether the massive and totally unprecedented cuts programme should begin now - or whether the massive and totally unprecedented cuts programme should instead begin in six months time.  This is interesting, but an equally interesting question is how on earth Britain is going to bring this huge adjustment off.

Behind closed doors, plans are being drawn up.  On the first floor of the Treasury, where the departmental spending teams live, people are busy thinking about how to bring off the biggest spending cuts package ever.  In the departments too, people are plotting away.  There are some very interesting ideas floating about Whitehall.

It’s time that we were allowed to know what they are thinking.  It is time for journalists to start asking the government again and again and again: where is the axe going to fall, and why won’t you be honest with us?