Massaging the Figures

Chancellors have always massaged the figures, of course. It is practically the Treasury initiation ritual. Osborne talked as if Armageddon were scheduled for Tuesday week. Hammond invoked productivity gremlins lurking in every spreadsheet cell. Sunak veered between sunshine and thunder depending on which wing of his party he needed to placate. Hunt conjured fiscal holes of varying diameters like a magician rummaging through a hat he found in a skip. But in every case the trick was the same: take an uncertain forecast and squeeze it until it squeals.

What they did not do was mis-describe the numbers sitting in front of them. Their sleight of hand relied on the fog of the future, not the clarity of the present ledger. Everyone in Westminster plays fast and loose with projections. Very few play games with the in-year accounts.

That is what makes the Reeves affair distinctive. By late October the Treasury had been told borrowing was running lower than expected and that the supposed fiscal shortfall had essentially evaporated. The in-year books were healthier, not sicker. Yet the public was treated to a sombre procession of warnings about “tough decisions” and an “urgent need” for tax rises. This was not Osborne hyperventilating about where we might be in 2025. This was the Chancellor shading the story of where we actually were.

And the markets noticed. The moment the Budget dropped, gilt yields fell and sterling strengthened. Investors, who are not known for their sentimental loyalty to Chancellors, treated the documents as a stabilising event. Thirty-year gilt yields saw their biggest one-day fall since April and the pound ticked upwards. A relief rally, yes, but a rally all the same. In other words: the people who actually lend Britain money were calmer than the Chancellor’s own rhetoric suggested. The City was reassured by the numbers she finally presented, not the crisis she had trailed beforehand.

Reeves does have a partial defence. She can point to long-term pressures: an ageing population, NHS pay, defence spending, welfare caseloads, debt interest. All real, all sizeable. But she did not bother to draw that distinction at the time. Instead she leaned on the old Treasury habit of conjuring a sense of impending doom from a set of present-day figures that did not support it.

So yes, she is in good company — but for the wrong reason. Past Chancellors dramatised the future. Reeves is accused of dramatising the present. A shabby tradition may explain her behaviour, but it does not excuse it. If Westminster insists on spinning the forecasts, fine, that is politics. But it should leave the current ledger alone. The markets certainly seemed more grounded in reality than the Chancellor’s pre-Budget tone. Which is a sentence no Chancellor should ever want written about them.