As I stop for a tuna sandwich, the Fat Controller has left the Treasury and is heading for parliament. Here is what I predicted in January. Let’s see how Osborne’s admissions today measure up.
1. Osborne changed his growth forecast for 2012 from 2.5% to 0.8%, so at this point he was out at the start of the year by a fact of just over three.
2. There will be a few more tank engines, but any real impact from the Fat Controller’s plan depends on the private sector coming in to leverage about £5 billion of public money. HM Treasury explication of its ‘clear’ infrastructure plan is here.
3. It is very small beer from Osborne, less than I expected. Outlook has to be that growth will fall even further than he now says and there will be some additional capex stimulus in the first half of 2012. He is going to follow the curve rather than influencing it throughout this crisis.
4. Politically the FC is taking the low road of a blame game. It’s all the fault of the Eurozone and the previous long-lived Labour government. There is a sufficient kernel of truth in this to deflect attention from the fact that Osborne himself has no new ideas about anything.