Lies, damned lies and the British election

Britain's politicians have been setting out their election stalls. To read the Conservative and Labour manifestos is to imagine the biggest challenge facing Britain over the next five years is whether the government balances the budget in 2018 or 2020. Putting aside more urgent economic, security or social problems, the numbers are all nonsense. They do not add up. And the politicians wonder why voters have lost faith.

This is not to say that the sea of spending, tax and borrowing promises produced by David Cameron's Tories and Ed Miliband's Labour are all a dastardly deception, though most are indeed offered with deliberately specious precision. No, the problem is that Messrs Cameron and Miliband have only the vaguest idea of how things will actually turn out in two or three, let alone five years hence.

By way of illustration, voters can look at the pledges made by George Osborne in his first Budget in June 2010. The new Conservative-Liberal Democrat coalition, the chancellor trumpeted, would all but wipe out Britain's then £150bn fiscal deficit by the end of the parliament. Austerity, he promised, would bring the gap between spending and revenues down to £20bn by the present financial year and it would disappear the next. Last month Mr Osborne had to admit the deficit is likely to turn out at a stubbornly high £75bn. Even allowing for some statistical adjustments along the way, that is some gap. But then, since 2010 the chancellor's figures have underestimated borrowing by an accumulated £100bn-plus.

The Conservatives could argue that these days the forecasts are independently produced by the Office for Budget Responsibility, that economic circumstances change and the government was blown off course by the persistence of the recession. Such excuses are not without merit. The untold story of the coalition's economic policy has been how Mr Osborne swapped his Plan A for deficit reduction for a less austere Plan B. It was a sensible response to events but one the chancellor would never admit.

The present deception is that there is nothing in Mr Cameron's latest manifesto, or for that matter in Mr Miliband's prospectus, that admits that all the numbers may change again. A marked improvement in productivity would see the deficit disappear of its own accord. Another downturn could well see it rise again.

Instead the electorate is offered spurious assertions that this spending pledge here can be funded by this extra revenue there - that spending on this or that programme or revenue from this or that tax can somehow be forecast and fixed now. The prime minister has lately been waving a promise to spend an extra £8bn on the National Health Service by 2020. He could add this represents not so much any increase in resources but a real-terms freeze.

Labour has contrived to be at once more precise and vaguer than the Conservatives. Each of Mr Miliband's plans for new spending is matched with a proposed tax increase. But, as the Institute for Fiscal Studies has pointed out, viewed over five years there are big gaps in Labour's explanation of how it will combine fiscal rectitude with a promised easing of austerity.

The media plays the same game, with reporters earnestly quizzing political leaders as to precisely when they will balance the books or how they can afford to spend a few extra hundred million pounds here or there several years hence. The big questions about the economy - about productivity, investment, skills and employment - go unasked. The voters are left in a blizzard of chaff.

The election should settle an important economic argument. One side, the Conservative party wants a permanently smaller state, though, as the campaign progresses, it has been increasingly reluctant to admit that this will demand swingeing cuts in many government programmes. Labour wants a more continental-style social market economy but pretends that it can be paid for by soaking a few rich foreigners. The gap between them is less than implied by the rhetoric but significant nonetheless. It is just that you will not find it in the numbers.

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