Sunday, December 06, 2009

Pre-Election Budget Report - Those Treasury Leaks In Full

BOM sources inside HM Treasury have smuggled out key passages from Wednesday's Pre-Budget Report. Quote:
  • Growth - due to unforeeable global circumstances entirely beyond the government's control, GDP this year may have fallen by somewhat more than the 2.75% decline forecast in April's Budget. But next year and forever after, growth will be much much stronger - the central estimate is now 7% pa, reflecting the fruits of the government's growth policies which were opposed every step of the way by the Old Etonians.
  • Spending - once again, public spending on vital frontline services will increase year-on-year - unlike the savage cuts planned by the Old Etonians. Wave after wave of Gershon efficiency savings will enable NHS waiting lists to be abolished, every child to have one-on-one personal tuition, and all our old people to spend their remaining years in the Dorchester Hotel. And to prove it, here are the figures: 3.1658, 3.1672, 3.2534, 4.6739, and 5.9912.
  • Tax - hard-working families will be rewarded with a new tax credit scheme, known as a Certificated Revenue Accrual Participation. This will bribe voters entitle hard-working families to a massive tax cut, encashable only if they vote for us at a date to be announced in the next budget. The CRAP will be financed by a new tax on super-rich Old Etonians.
  • Fiscal responsibility - as a result of the strong and sustained growth now in prospect, tax revenues are projected to increase at their fastest rate for a generation. The fiscal envelope will be stuffed as never before, and the National Debt will have been paid off in its entirety by 2015. There will be health, wealth and happiness for all. Except Old Etonians.

So is this PBR in any sense a serious exercise?

The leaks say that there will be a public spending freeze. But what does that mean?

As you will recall, April's Budget incorporated spending cuts (the ones denied by liar Brown for so long), but there was no clue as to what they would be. They were just unspecified cuts. And from what Darling told his old school chum Mr Marr this morning, we will get no more detail this time. Darling reckoned he can't specify the detail because there's too much uncertainty just now. What self-serving piffle.

The only spending cut he was prepared to mention is BOM's old friend the NHS Supercomputer - the white elephant personally ordered by Bliar at an initial budget of £2.3bn, last estimated to cost £12.7bn, running years behind schedule, and not actually working (see numerous previous posts). Setting aside the obvious question of WTFFFFFFFFF they ever did it in the first place, scrapping it is sensible - when we looked into possible savings, we reckoned outright scrapping could still save us c £1bn pa each year up until 2015-16.

But apart from that, the rest is silence. Cam and Oz will be starting from scratch.

PS Pre-budget Treasury leaks (aka expectations management) are of course as old as time. Tyler himself was once involved in an official leaks enquiry when he worked at HMT. Funnily enough, they never did trace that one back to its obvious source just across the courtyard (see this blog).

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