In his autumn statement to MPs yesterday, George Osborne went as far as saying that Britain's economic recovery is "on track" and that "the plan is working". The Chancellor deserves top marks for self-confidence. But he knows full well that it is too soon to be so certain.

Mr Osborne cited analysis published yesterday by the Office for Budget Responsibility. Its director, Robert Chote, raised the OBR's growth estimate for this year, but slightly lowered its growth estimates for the next two years. The main source of good news was a sharp reduction in predicted job losses in the public sector, from 490,000 to 330,000.

The adjustments cannot conceal the pain to come. In the New Year, when inflation remains high and pay rises remain scarce, a rise in VAT to 20 per cent will reduce the spending power of most consumers. Combined with a fall in house prices – the OBR forecasts a 3.1 per cent drop over 2011, having previously expected a small rise – this cocktail will reduce the quality of life for millions.

Nor do conditions beyond our shores bode well. The global economy remains fragile, and the crisis in the eurozone makes it unlikely that Britain will be able to export its way to recovery. As Alan Johnson pointed out yesterday in his most impressive Commons performance yet as shadow Chancellor, with exports unlikely to rise sharply, and businesses still showing few signs of increasing investment, the private-sector recovery longed for by Mr Osborne requires a leap of faith.

Converting these spending cuts from numbers on a spreadsheet to changes on the high street will be very difficult. The public supports fiscal consolidation, but retaining goodwill as the cuts begin to bite will not be easy.

For several months this newspaper has argued that, on balance, the Government is cutting public spending too fast and too deep. Mr Osborne deserves credit for restoring market confidence, but nothing that he or Mr Chote said yesterday alters that judgement significantly. It is only in the coming months, when public spending is tightened, that we will start to learn if Britain is indeed on track – or heading downhill out of control.