You are here: Home » Featured »

The curious case of the Chancellor, the 4G sale and government borrowing

December 5, 2012 2:10 pm

Author:

Tags:

Share this Article

George Osborne seemed very pleased with himself today, as he suggested that borrowing is forecast to fall.

And yet that’s not the full picture.

The only reason borrowing is forecast to fall this year is because the government has added the 4G mobile spectrum auction to this year’s figures – even though government delays mean the auction hasn’t happened yet. Without the £3.5bn receipts penciled in from the 4G sale, borrowing would be £2bn higher this year than last year.

Previous OBR estimates had suggested that the 4G spectrum could be worth between £1.5 billion and £6.7 billion. It’s unclear at this stage where the £3.5 billion figure came from, as the spectrum hasn’t been sold yet… George Eaton calls it “an accounting trick worthy of Enron” – and he’s right.

Has Osborne factored in money not yet received from a 4G spectrum auction which hasn’t taken place yet, in an attempt to cover the fact that he was set to borrow more this year than last year? It certainly looks like it…

Related posts:

  1. Government borrowing higher than last year – it’s hurting – and it’s not working
  2. Government urged to postpone austerity programme
  3. The Osborne Effect – public sector net borrowing
  4. The curious case of the cancelled chancellor’s speech…
  5. Borrowing is rising – and a rising welfare bill is to blame
  • rekrab

    A shocking lack of detail from Osborne as he piles more pressure and austerity on those who have the least.

    In June 2010 Cameron and Osborne both said they had saved Britain from a fate worse than Greece? while 18 months on we have the longest ever double dip recession and we’re spending more than ever before propping up more austerity.If you were a betting person, you wouldn’t trust Osborne with a penny

  • Serbitar

    I think Mystic Meg would probably make more accurate economic forecasts via her crystal ball than the OBR’s statisticians. It is difficult to identify an organisation or institution that has been so wrong, about so much, for such a long time… other than the government itself of course… which goes without saying.

    • Quiet_Sceptic

      ‘the government’ or do you mean simply ‘government’.

      I don’t think any of the UK political parties have shown any competence in economic prediction.

    • Quiet_Sceptic

      ‘the government’ or do you mean simply ‘government’.

      I don’t think any of the UK political parties have shown any competence in economic prediction.

      • Serbitar

        True that.

      • Serbitar

        True that.

      • Serbitar

        True that.

    • JoeDM

      No economic forcast is worth the paper it is printed on.

      Trying to manage an economy through Keynesian-style demand management is like trying to drive a car when you can only see your rear view mirror.

      • TomFairfax

        Strangely enough something similar was said about Geofrey Howe’s monetarist stint as Chancellor in the first Thatcher government at the time. Something about driving a car by just looking at the instruments and not out of the window.

  • JoeDM

    I was very surprised by the dreadful performance by Ed Balls. He seemed to totally out of his depth and unprepared.

    • aracataca

      Oh what and Osborne was good?

    • aracataca

      Oh what and Osborne was good?

    • aracataca

      Oh what and Osborne was good?

  • Quiet_Sceptic

    It’s hard to get excited about.

    Compared to things like PFI and pension liabilities which are off-balance sheet it’s a drop in the ocean.

Latest

  • Comment Why Labour is fighting for the legalisation of Humanist marriages today

    Why Labour is fighting for the legalisation of Humanist marriages today

    By Glenys Thornton

    Monday saw the first day of Committee on the Same Sex Marriage Bill, where it became clear after a three hour debate on how to distinguish Same Sex Marriage from so called “traditional” marriage that opposition to this bill has not gone away. Despite a huge defeat on Second Reading, opponents reheated and repeated their earlier speeches, in part because their arguments rely on belief and prejudice not evidence or fact. So we sat until 11pm debating conscience clauses, Registrars [...]

    Read more →
  • Comment Sometimes what is unsaid at PMQs is the most important thing of all…

    Sometimes what is unsaid at PMQs is the most important thing of all…

    By Mark Ferguson

    Well that was a bad PMQs for Ed Miliband – the second in a row. Perhaps he hasn’t gotten back into his stride after such a long period without the weekly Wednesday joust, but whatever it is, Miliband isn’t hitting his marks at PMQs. Meanwhile Cameron – who has been jousting with world leaders this week – seemed far more o top of his game than we’ve been used to seeing him lately. Alas the problem for Miliband was that [...]

    Read more →
  • Video Cameron refuses to answer question on secret government plans to hike interest on student loans

    Cameron refuses to answer question on secret government plans to hike interest on student loans

    Last week it was revealed that the government discussed secret plans to hike interest on pre-existing student loans, meaning that anyone with a student loan will be expected to pay far more than expected. Today, the Prime Minister was asked about this – he spoke for nearly a minute but wouldn’t answer the question. What does he have to hide? How much more does he expect graduates to pay?

    Read more →
  • Comment Who benefits? Delivering on energy and infrastructure

    Who benefits? Delivering on energy and infrastructure

    By John Woodcock

    Across the industrial north, it is striking how old pit villages and industrial towns are proving far less willing to embrace renewable energy than the noisier, more polluting fossil fuels and industries which shaped their identity. Energy companies are getting a nasty shock after mistakenly believing that these communities would not bat an eyelid at a few wind turbines on the surrounding hills because they had been content to make huge slag heaps part of the landscape in decades past. [...]

    Read more →
  • News Put reckless bankers in jail – Media roundup: June 19th, 2013

    Put reckless bankers in jail – Media roundup: June 19th, 2013

    Subscribers to our morning email get the best of LabourList – including the Media and blog round up – every weekday morning. If you were a subscriber you would have already received this (and much more) in your inbox. You can sign up here. Put reckless bankers in jail Britain’s banking bosses should face jail if their decisions force fresh bailouts, the Parliamentary Commission on Banking Standards says today. The commission’s hotly anticipated report urges the Chancellor, George Osborne, to oversee the [...]

    Read more →