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

5th December, 2012 2:10 pm

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…

To report anything from the comment section, please e-mail [email protected]
  • 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 Featured Owen Smith: Three leadership hustings is not enough – let’s have one in every UK region

    Owen Smith: Three leadership hustings is not enough – let’s have one in every UK region

    Owen Smith has today written to Jeremy Corbyn asking him to back a plan to hold “at least one” leadership hustings in each UK region.   Dear Jeremy, In less than two months’ time, Labour Party members and supporters will be casting their votes for who should be the next Leader of our Party. It’s the most important decision our Party will have taken in a generation and will define our future as an effective opposition and party of government.   I […]

    Read more →
  • Featured News McDonnell in dramatic TV plea to warring factions to “stop this now”

    McDonnell in dramatic TV plea to warring factions to “stop this now”

    John McDonnell today claimed a small group of people are willing to “destroy” Labour simply to remove Jeremy Corbyn and made a dramatic appeal direct to MPs and members to bring an end to the in-fighting. The shadow Chancellor sounded emotional as he demanded “stop this now” as the Labour leadership faced questions over allegations one of their staff had made an “unauthorised” entry into the office of a former shadow Cabinet minister. McDonnell, who was appearing on the Andrew Marr […]

    Read more →
  • Featured News Seema Malhotra accuses Corbyn aide over office entry

    Seema Malhotra accuses Corbyn aide over office entry

    A former shadow Cabinet minister has accused aides to Jeremy Corbyn and John McDonnell of violating her security by making an “unauthorised” entry into her office. Seema Malhotra has demanded Commons officials launch an investigation after accusing the leader’s staff of effectively breaking into her office and claimed her own researchers had suffered “harassment”. Malhotra, who resigned as shadow Chief Secretary to the Treasury last month, has written to John Bercow, Speaker of the House of Commons, saying the entry undermined the […]

    Read more →
  • Featured News Corbyn condemns abuse as 40 female MPs demand action over “disgusting” incidents

    Corbyn condemns abuse as 40 female MPs demand action over “disgusting” incidents

    Jeremy Corbyn will today confront claims of abuse in the Labour Party as he uses a series of events around Britain to appeal to left-wing voters to help him retain the leadership and deliver a “social movement”. Corbyn, who has faced claims that he has done too little to tackle personal abuse in the party, will repeat his condemnation of harassment and threats after more than 40 female Labour MPs wrote to him demanding he take action to tackle an “extremely worrying […]

    Read more →
  • Comment Europe The EU referendum showed that UKIP is now the biggest threat to Labour

    The EU referendum showed that UKIP is now the biggest threat to Labour

    For a long time now commentators and Labour figures have regularly remarked on the growing cultural and political distance between the Labour Party and the core Labour vote, particularly outside London. This fact was clearly demonstrated in the EU referendum, where Labour heartlands overwhelmingly rejected Labour’s stance on EU membership and all things associated with it.  This should serve as an immediate and urgent wake up call to the Labour Party. During the referendum campaign I served as General Secretary of […]

    Read more →
x

LabourList Daily Email

Everything Labour. Every weekday morning

Share with your friends










Submit