Am I dreaming? No Brown is changing the rules

As I woke up this morning and heard the news on Radio 4,I thought perhaps I was dreaming.But no Gordon Brown is considering re writing his fiscal rules in order to pull the economy out of the recession.

The problem,well the government cannot reflate the economy as it is already borrowing up to its 40% limit of Gross Domestic product.It can't realistically increase tax,therefore one simple change.Tear up the rule book and start again.

Now the treasury will argue that we are at the end of fiscal cycle and therefore the rules can change.In fact during this year the figure has been closer to 50% as revenues have not matched forecasts as the economy slows down.

A little speculation from Fraser Nelson

Brown has realised that if the Tories win the next election the he is now spending with Cameron’s Gold Card – every by-election bribe, every union sellout will be funded by borrowing with the bill sent to D. Cameron Esq. Cameron will have to tax us to pay for what Brown is today spending.

And not surprisingly the Tories are aghast.George Osbourne says this is the end of an era.On the today programme he tells us

What he is doing is to give the prisoner their own key to their prison cell - this is the final collapse of the Brown era.
“He claimed to have created a system that would constrain the government during the good-times and release the government during the bad times - it is no good if the government can get out of the straight jacket.”

and as always John Redwood quick off the mark

After the fiddled figures comes the changed rules. For years we have been served up a diet of changed statistics, altered bases for setting out public spending, a riot of off balance sheet disguises for extra borrowing, and changes in the dates of the famous cycle that is meant to anchor the government’s spending controls. Despite all that we learn today that even the government think their so called fiscal rules lack credibility, so we are to have new ones that allow the government to carry on borrowing as if there were no day of repayment.