ONS widens goalposts for Brown

THE Office for National Statistics today handed Gordon Brown some much-needed room for manoeuvre in meeting his fiscal rules by revamping the way it calculates road maintenance and repair costs.

In a move condemned by opposition MPs as Government 'jiggery-pokery' with the national accounts, the ONS said the changes raised the current budget surplus over the five years starting 1999-2000 by £2.1bn.

This will boost the £8bn margin Brown believes he has on meeting the Golden Rule - to borrow only to invest over the economic cycle. The ONS said it made the revision because it had incorrectly used a combination of two approaches for recording road maintenance expenditure that resulted in some double-counting.

'Correcting this reduces current expenditure and increases net investment,' it said.

Experts believe it is touch-and-go whether Brown will meet his Golden Rule. By shifting spending on road maintenance from the current to the capital account, the ONS has given him more leeway.

However, economists said tax rises were still inevitable. 'This does not change the big picture of very high levels of public borrowing and the need for a period of fiscal consolidation. In short, taxes are still going up after the election,' said Jonathan Loynes at Capital Economics.

Today's revision is the latest of several by the ONS. Last year, it doubled key economic growth data after a mix-up over construction output.