The claim
“Growth is higher in every quarter in every year than in the June forecast.”
Chancellor George Osborne, House of Commons, 29 November 2010

The background
Today the Office for Budget Responsibility – the much heralded budget watchdog set up in May – pronounced their verdict on the Spending Review. There was some positive news for the government on job losses and borrowing. But they also warned of “sluggish” recovery from the recession as they lowered their GDP growth forecasts for the next two years.

When the Chancellor got to his feet to give a statement to the House of Commons on the economy, he acknowledged the predictions of the rate of economic growth had been revised down.

But in his response to Shadow Chancellor Alan Johnson, Mr Osborne he said  that “growth is higher in every quarter in every year than in the June forecast”.

And that confused FactCheck.

The analysis
Although growth for this year has been revised up to 1.8 per cent by the OBR, they were less optimistic about the next two years. For 2011, the OBR growth forecast fell from 2.3 per cent to 2.1 per cent, and in 2012 from 2.8 per cent to 2.6 per cent.

And the next three quarters all see their growth forecasts revised down by 0.1 or 0.2 per cent, according to Table 3.4 of the OBR’s Economic and fiscal outlook document (see pg 37).

They say, the VAT hike in January to 20 per cent on top of the governments plans to cut the deficit means “quarter-on-quarter growth to be at its slowed at 0.3 per cent in the first quarter of next year.”

So, FactCheck called the Treasury – and a spokesman said the Chancellor “misspoke” in his reply to the Shadow Chancellor.

“The Chancellor was very clear in his statement, in which he referred to the level of GDP as being higher in every year – but in this case he misspoke,” the spokesperson said.

If he had said GDP would be higher every quarter and every year than in the June forecasts he would have been right – because GDP will start from a higher level, as growth this year has been higher than the June forecast predicted.

The verdict
Here at FactCheck, we will always accept the “it was an honest mistake'” defence. But Mr Osborne needs to be careful not to mix up GDP and growth. Yes, overall GDP will be higher than the June forecasts because of the boost it has received this year, but GDP growth, which Mr Osborne referred to, will be slower than the June forecasts set out.