George Osborne's deficit dissembling in the Autumn Statement

Our Economics Editor on a disgracefully misleading claim made by the Chancellor

Share

George Osborne had a surprise for us all in his Autumn Statement today:

"Today's figures show that, with or without the APF coupons [the temporary windfall from taking the Bank of England's QE coupons onto the Treasury's books], the deficit is forecast to fall this year."

That's odd, because the public finance figures have shown the deficit so far in 2012-13 running about £5bn higher than in the 2013-14 financial year.

Osborne went on to taunt those who have predicted that the borrowing bill would rise:

“There are those who have been saying that the deficit was going up this year. But any way you present them that is not what the OBR forecasts show today. They say the deficit is coming down. Coming down this year - and every year of this Parliament."

This is quite disgracefully misleading.

Read the (very) small print of the Office for Budget Responsibility document and it shows that Osborne's figures do exclude the APF. But they do not strip out the one-off effect of his move to take the assets of Bradford and Bingley (B&B) and Northern Rock (NRAM) on to the public balance sheet.

Here's the OBR 2012/13 deficit forecast between the March Budget and today's Autumn Statement without stripping out that accounting wheeze:

Yes, it looks like the OBR borrowing forecast has been revised down.

But here's what happens to the OBR forecast when you exclude the banking assets move:

Yes, the deficit is rising in cash terms.

And as for the deficit “coming down every year", as Osborne put it, yes, as a percentage of GDP.

But the forecast for cash borrowing is now higher every year, to the total tune of £101bn, stripping out all the accounting tricks, as this shows:

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: In House Counsel - Contracts

Negotiable: Recruitment Genius: This leading supplier of compliance software a...

Recruitment Genius: Associate System Engineer

£24000 - £30000 per annum: Recruitment Genius: The Associate System Engineer r...

Recruitment Genius: Executive Assistant

Negotiable: Recruitment Genius: An Executive Assistant is required to join a l...

Ashdown Group: Marketing Manager - B2B, Corporate - City, London

£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, glo...

Day In a Page

Read Next
Zoe Sugg, aka Zoella, with her boyfriend, fellow vlogger Alfie Deyes  

If children are obese then blame food manufacturers, not Zoella

Jane Merrick
Amos Yee arrives with his father at the State courts in Singapore on March 31  

Singapore's arrest of a 16-year-old YouTuber is all you need to know about Lee Kuan Yew's legacy

Noah Sin
General Election 2015: The masterminds behind the scenes

The masterminds behind the election

How do you get your party leader to embrace a message and then stick to it? By employing these people
Machine Gun America: The amusement park where teenagers go to shoot a huge range of automatic weapons

Machine Gun America

The amusement park where teenagers go to shoot a huge range of automatic weapons
The ethics of pet food: Why are we are so selective in how we show animals our love?

The ethics of pet food

Why are we are so selective in how we show animals our love?
How Tansy Davies turned 9/11 into her opera 'Between Worlds'

How a composer turned 9/11 into her opera 'Between Worlds'

Tansy Davies makes her operatic debut with a work about the attack on the Twin Towers. Despite the topic, she says it is a life-affirming piece
11 best bedside tables

11 best bedside tables

It could be the first thing you see in the morning, so make it work for you. We find night stands, tables and cabinets to wake up to
Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police

Steve Bunce: Inside Boxing

Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police
No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media