Forget George Osborne’s speech; ignore Ed Miliband’s response. Politics does not tell you anything about the nation’s finances. These charts do. The big message is that the public finances in Britain were terrible, are terrible and still need lots of work to repair the damage.
1. The deficit is still terrible
Borrowing is falling and public sector debt is not rising so fast, but these facts are small comforts. The big picture is that Britain is still borrowing hugely – more than almost any other advanced economy – and will do so for many years to come.
The good news from the red line is that the borrowing outlook is better than a year ago, but still falls short of expectations in the 2012 Budget.