The deficit is falling! Today's figures show that the budget deficit for 2012-13 (public sector net borrowing, excluding some of the more obvious distortions) was £120.6billion - £0.3billion lower than in 2011-12. So maybe the Chancellor's cunning plan - to reduce last year's deficit by not paying some of the...

The first substantive line of George Osborne's budget speech was:

"We've now cut the deficit not by a quarter, but by a third".

This might be surprising to anybody who read my earlier blog here, which pointed out that the deficit had (measured on a rolling twelve- month...

Tonight, Ed Miliband will - again - admit that "Labour didn't get it right on immigration", in particular by failing to impose the "maximum transitional controls" on those coming here from the new EU Member States.

As I've pointed out before, this ignores the fact that pretty...

The continued dismal performance of the UK economy is entirely consistent with the predictions of those of us who have argued consistently for the last two years that premature fiscal consolidation would be severely contractionary in the short term, and risked doing significant long-term economic and social damage. As has...

On Wednesday the Government published its "Midterm Review: Programme for Government Update". This was intended to be a comprehensive assessment of progress against the commitments made in the original Coalition Agreement. The Prime Minister said that this "audit" would be "full, frank and unvarnished."

Naturally,...

In the Autumn Statement the chancellor decided to cut working age benefits and tax credits, thus reversing his previous (sensible) policy of allowing the "automatic stabilisers" to operate, and ignoring the advice of the IMF. More on the macroeconomic issues here. He justified this change thus:

But...

Just as talk about a "double-dip recession" after the unusually bad second quarter growth figures was overdone, so was the euphoria about Britain "surging out of recession" after the third quarter figures. The official forecasts from the Office of Budget Responsibility today are for growth of 1.2 percent in 2013...

I, and my NIESR colleagues Angus Armstrong and Simon Kirby, gave evidence to the Treasury Committee on Tuesday, 13 November. Should you have time and inclination, you can watch. As you would expect, we covered a range of topics: the fiscal framework and fiscal policy, multipliers, the 'productivity...

How many illegal immigrants are there in the UK? Unlike other such questions - how many 12 year olds are there in the UK? How many gay Jews? - where, although we don't know the exact answer, either survey and administrative data allows us to make an informed and reasonably...

Is deficit-cutting - particularly the fiscal consolidation programmes currently under way in most European Union countries - self-defeating? This question has been thrown into sharp focus by the IMF's belated reassessment of the magnitude of the "fiscal multiplier" in major industrialised countries during the Great Recession. New research...

For the UK, and indeed other advanced economies, the most important point in today's IMF World Economic Outlook is not that it further explodes the myth - repeated again yesterday by the Chancellor - that low interest rates reflect policy "credibility" rather than economic weakness, or that it...

It has been widely reported that the government is considering abandoning the second half of its fiscal mandate - that debt should be falling as a percentage of GDP in 2015-16. My view is that the short term economic impacts of this are limited. It's not really news;...

With the economy persistently weak, there is a growing consensus among economists that premature austerity has done considerable unnecessary damage, and that there is a strong case for slowing fiscal consolidation - at least to restore some of the unnecessary and damaging cuts to public investment...

This post relates to the ongoing blog debate on "the state of macroeconomics", which I contributed to here, and which has drawn in a whole host of economics bloggers who know far more about modern macroeconomic theory than I do. However, here I want to address a related,...

The first achievement highlighted by the Prime Minister in his Sunday Times article yesterday was deficit reduction:

"We've got the deficit down by a quarter already"

This statement is true. But what the Prime Minister didn't say was that the economic outlook the Prime Minister inherited was for...