Despite the claims of the Spectator’s Fraser Nelson, it appears Osborne was right to claim to have halved the UK deficit
Peter Hoskin on ConservativeHome has managed to elucidate for us precisely why George Osborne has actually halved the deficit. And sadly for both Fraser Nelson and other critics of the Chancellor, they’ve been caught looking at the wrong numbers!
So why did Osborne go from claiming before the Autumn statement that the deficit was reduced by a third to a fully fledged half? Well, the answer it seems is simple, straight forward and rather honest. The Conservative treasury team, rather fairly, went from using 2013/14 statistics to 2014/15 statistics. No surprise given the date shows we’re finishing this current year.
Fraser put this down to them shifting from one measure of the deficit (public sector net borrowing, recorded in £billions) to another measure of the deficit (the deficit on the cyclically-adjusted current budget, recorded as a percentage of GDP). But now we can clearly see he was simply wrong and making mistaken judgements.
Maybe Mr Nelson should just ask for clarification before leaping to judgements in the future?
Here is an easy to read graph from the OBR to clarify what they mean: