The Conservatives were swift to point to the buoyant state of the economy. A fresh row about the distortions to the headline number of benefit claimants could not overshadow a batch of upbeat figures on joblessness, employment, vacancies and pay.
Kenneth Clarke also repeated his claim that the Government budget was on track to balance by 2000. But critics said the public finances should be in a healthier state, even though the Public Sector Borrowing Requirement (PSBR) last financial year was, at pounds 22.8bn, some pounds 3.6bn below target.
The headline unemployment rate fell to 6.1 per cent, its lowest for six years, last month. A fall of 41,100 took the total number of claimants to 1,707,000.
The Office for National Statistics cautiously admitted the underlying rate of fall in the total was higher than the 15,000-20,000 a month it had estimated before the introduction of the Jobseekers' Allowance in October.
Labour repeated its accusation that the headline figure was fiddled. TUC general secretary John Monks said: "The fall in the numbers able to claim benefits is giving a misleading impression of improvement in the labour market."
Most economists thought other figures yesterday confirmed the picture of a booming economy. The more reliable quarterly Labour Force Survey showed a drop of 111,000 in unemployment to 2,111,000 in December to February - smaller than the 181,700 drop in the claimant count during the same months.
Employment increased by 135,000 during the latest quarter, and by 351,000 over the past year. Notifications of new vacancies at Jobcentres set a record, reaching 249,500 in March.
The tighter conditions were reflected in an increase in the underlying growth of average earnings from 4.75 per cent to 5 per cent in February.
Paul Gregg at the London School of Economics said: "All the indications are that this is the kind of labour market boom we last experienced in the late 1980s."
Separate figures showed that a combination of tough spending control and higher tax receipts than forecast helped the PSBR beat the Budget target of pounds 26.4bn for 1995/96 by pounds 3.6bn. Privatisation proceeds contributed pounds 4.4bn.
Alistair Darling, Labour's Treasury spokesman, said: "Government borrowing is far higher than it should be at this stage." City experts said the big problem for the next government would be meeting even tougher spending plans for the next three years.
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