Alistair Darling announced in his speech that the Government had a plan to rapidly reduce the national debt:
There are two big problems with that statement. First, the comparison to the G7 is deeply misleading. Second, to describe their current projections as a "deficit reduction plan" is a bit of a stretch.
Here are OECD's estimates for deficits in 2010, from last November:
General government financial deficit, per cent of GDP
The rest of the G7 might be planning on cutting the deficit more slowly. But that's because they have a lot less deficit to cut!
And the idea that the Government have a deficit reduction plan is a bit farcical. If I tell you that tomorrow I'm going to jump over the moon, would you say I have a "moon vaulting plan"?
Alistair Darling hasn't announced how the Government plan to cut spending and deal with the deficit. They've announced some tax hikes but they are likely to hurt the economy and put people out of work. Independent forecasters don't expect the 50p rate - for example - to raise revenue.
Pretty much the best we've had in the Budget - in terms of detail about how they plan to cut spending - is a proposal to reform Housing Benefit. And the Budget report doesn't expect significant amounts of money to be saved thanks to that measure any time soon, but that it will save £50 million "in steady state" (table 1.2, note 3) - i.e. eventually. Housing Benefit does need to be changed, but this reform is a drop in the ocean of borrowing that is expected in the coming years. The Government's efficiency programme might generate some savings but previous attempts, like the Gershon Review have produced underwhelming results.
Alistair Darling has largely left the issue for the in-tray of whoever is Chancellor after the coming election. There is no real deficit reduction plan in the Budget. If you want a plan to cut spending and get the public finances in control, you would be better off reading the TPA's new book.