‘This could affect the political debate’
Updated on 16 September 2009
Today’s leaked Treasury document tells us things we didn’t know before about the UK’s economic prospects, explains Channel 4 News economics correspondent Faisal Islam.
Krishnan Guru-Murthy speaks to Faisal Islam about the significance of today's leak by the Conservatives of a Treasury document containing departmental budget forecasts up until 2014.
KGM: Downing Street is saying no numbers have been set in stone beyond 2010-11. So what are these numbers that we’re looking at?
FI: Well, they aren’t secret plans but they are forecasts. These are the best estimates of the Treasury number crunchers, the government number crunchers, just before the budget in April.
Basically, we’ve never had this level of detail and breakdown about a budgetary forecast before.
So (a) it obviously undermines various public statements made by government ministers over the past few months. We never would have known that if we didn’t know what their number crunchers were saying.
But also there’s various little bits of interesting detail. So, for example, we know now that the Treasury is forecasting that 2013-14 £193bn will be being spent on social security.
Roughly one in 10 pounds in the economy is spent on social security right now. Next year it’ll be one in eight – a big difference.
KGM: Because there’s so many people unemployed?
FI: Yes, true. But the scale of this we don’t understand. This could start to affect the political debate. We have hard numbers on which the political debate will be had ahead of the election.
Another number. Again, we could imply from the budget numbers that there would be cuts to departmental spending. But this sets out the departmental expenditure envelope – the DEL envelope. The sort of thing you get when there’s going to be a spending review.
We didn’t get that because they don’t have a spending review – but we do have this now. We have the DEL envelope. We can work out the overall spending envelope in which departments will have to kind of bid for priorities.
And so you can do some serious fiscal arithmetic and work out what’s going on.
When someone denies cuts – and the numbers in plain black and white are -.8 per cent, -4 per cent, -1.8 per cent and -3 per cent, year on year, in real terms – it’s pretty hard to argue it, unless the prime minister just didn’t know about the existence of this spreadsheet, which, given that the prime minister was chancellor for 10 years and bestrode the chancellory, seems a little unlikely.
