Alistair Darling has not set out a new fiscal framework in his much-delayed Mais lecture – but he has read the last rites over the so-called the financial rules. “To apply the fiscal rules in a rigid manner today would be perverse,” he says. Not to say impossible: the rules set a 40% limit on net debt and it was 43.4% last month. Instead there is assurance that “people should be in no doubt that Government will take the decisions necessary, to ensure sustainability in the medium term.”
George Osborne – back in action, and with a major speech planned on Friday – has released other Brown quotes which pledge his rules were always and forever. Like: “at all times—now and in the future—we will never compromise our commitment to meet our fiscal rules and disciplines” (April 02).
We’ll get the new fiscal rules in the as-yet-unscheduled Pre-Budget Report which is likely to be choc full of Brownies – and may even mark the debut of Mr Brown’s new debt measurement “Public sector net debt (excluding Northern Rock)”.
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