By Peter Hoskin
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George Osborne’s appearance on the Andrew
Marr show was very much like David Cameron’s article for the Mail on Sunday
this morning. Like the Prime Minister, he emphasised many of the “big, radical
decisions” that this Government has already taken, from schools reform to deficit
reduction. And, also like the Prime Minister, he said that more must be done to
overcome certain obstacles (e.g. NIMBYism) and secure economic recovery. On Mr Osborne’s list of priorities were further planning deregulation,
including the loosening of restrictions abound the green belt, and more airport
capacity in the South East. This was a blunt, tenacious performance from the Chancellor.
It contained much to suggest that the Government is going up the pace in its pursuit
of growth.

If anything was different between George
Osborne’s and David Cameron’s words it was that the Chancellor sounded even
more combative. He rounded on his Tory critics — who, in the form of David
 and Brian Binley, are out in force this morning — and
urged them to “get behind the Government”. He also described many of their
economic recommendations as “mutually contradictory”. I suspect this is a
battle that is only going to escalate, whatever the contents of the Autumn

But, more than the calls for a new Chancellor
or the calls for new policies, George Osborne should be especially concerned
about one line in his critics’ attacks this morning. And that one line is this,
from Brian Binley’s article:

“It is now clear that the Chancellor will not fulfil his
Election promise of eliminating the deficit by 2015.”

Why is this so concerning? Because, in
several respects, it’s wrong. There was no election promise to eliminate the
deficit by 2015. In fact, the promise in the party
was to “eliminate the bulk of the structural deficit over a
Parliament”. Even before we consider the fact that this “structural deficit”
(aka, the cyclically-adjusted current budget) is not the same as “the deficit”
(aka, public sector net borrowing), it’s clear that “the bulk” is not the same
as the whole. In this case, Mr Binley is attacking his own party's leadership on a
false premise.

But what about since the election? Even then,
Mr Osborne hasn’t strictly promised to eliminate the deficit, structural or
otherwise, by 2015. I explained the government’s fiscal rules in a post
for the Spectator’s Coffeee House
a few months ago, but the basic point is
this: the Chancellor aims to eliminate the structural deficit by the end of a
rolling five-year period. This rolling period begins afresh each year, such
that in 2010 the aim was to eliminate the structural deficit by 2015-16, but
this year it’s by 2016-17. The length of this Parliament doesn’t actually come
into it.

Of course, as I pointed out in my Coffee
House post, you could say that it’s a weird sort of fiscal rule that allows the
Treasury’s structural deficit forecasts to slip as
they have
. But Mr Binley didn’t make that charge against George Osborne, and
instead deployed an attack that isn’t quite accurate. This typifies a problem
that people from yours truly (in a column
about Paul Ryan
) to the CPS’s
Ryan Bourne
have highlighted recently. If even Tory MPs aren’t sure about
what the Chancellor is up to, then what about the public? George Osborne should
make it a priority to explain himself more clearly.

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