"If, as seems all too likely, Mr Darling's gamble on growth fails to pay off, then the eventual peak in the Government's borrowing could leap above £200 billion. Some authoritative forecasters believe it could soar to £230 billion, or a stunning 16 percent of national income.
Worse still, even the Treasury's own numbers suggest that about three quarters of the predicted borrowing peak of 12 percent of national income is not owing to the 'cyclical' ups and downs of the economy, but to more permanent, structual factors. Thus, even if strong growth does emerge, borrowing will not fall away as rapidly as it has climbed."
Thanks to New Labour's profligacy, the black hole in the public finances is both collosal and entrenched. As Lord Lamont suggested yesterday, the Budget does little to rectify matters. Alistair Darling's "path to sustainability" is actually a path to a distinctly unsustainble 5 percent deficit. And it's now even clearer, if that were possible, that the next government will have to implement substantial spending cuts and tax rises.
Of course, this creates a tricky political situation for any incoming Tory government. On this morning's Today Programme, Evan Davis pressed Darling on whether Labour in Opposition would attack Chancellor Osborne for "Tory cuts" taken to repair the public finances. The question barely needs answering - of course they would. Which makes it even more crucial that the Tories set out - perhaps in a 'Domesday Book' - just how horrendous their potential inheritance will be.