Analysts are starting to work through the implications of the looming squeeze on departmental spending. Whitehall is bracing for job cuts, but the raw numbers are still quite stark.

Take defence. George Osborne promised to spare the MoD from part of the 25 per cent cuts. But even a flat cash settlement — of 10 to 15 per cent cuts — would place heavy strain on the budget.

Malcolm Chalmers at RUSI has calculated what a 15 per cent cut would mean for personnel.

If, as our central scenario suggests, total real spending on personnel falls by around 13%, total personnel numbers would therefore have to fall by around 15% by 2014. Total personnel numbers would then be reduced from 283,000 to 240,000. If spread proportionately, this would lead to a 30,000 cut in military personnel numbers, together with a reduction in civilian personnel numbers of around 13,000.

At a time of war, announcing 43,000 job cuts is politically toxic. The MoD is no stranger to shedding staff — the size of the Defence Equipment and Support group in Bristol has fallen by more than 10,000 over the last few years. But the squeeze on numbers this time will be of a different order. Given around 40 per cent of the budget is staff costs, there is little alternative. Read more

A slim but distinguished figure was yesterday waiting in the foyer of Deutsche Bank yesterday; none other than Lord Mandelson, former business secretary. Apparently he was kept waiting for at least a quarter of an hour.

This morning I called the peer to make sure there isn’t a Mandy doppelganger wandering around the streets of the City of London. Read more