Spending Review: Has George Osborne’s caution condemned Britain to a lost decade?

The Labour party used to joke that the Tories would act as their cleaners: win, take the political pain, abolish the deficit by 2015 and then hand over a balanced budget when they lost the election. George Osborne has, at the very least, put paid to that. His Spending Review this week made it clear how painfully little progress is being made. Whoever wins the next election could close every school, open every prison, cede Northern Ireland, close every embassy and sack every soldier, sailor and airman — and it would still not be enough to put the government back in the black. Britain is a terrifyingly long way from fiscal sanity.

If the Chancellor had actually cut the government machine when voters expected him to, the pain would be almost over by now. Instead he has given himself eight years to cut total government spending by just 2.6 per cent. When the Labour government was forced to find savings by the IMF in 1976, it managed more than this in under a year.