Osborne - it's not over

Remember George Osborne's claim that Gordon Brown had failed to mend the roof when the sun was shining? The chancellor has just promised that if the Tories are in power after the next election he will not make the same mistake.

He has pledged that even when the nation's books have been balanced he will keep the lid on spending in order to put aside money for the next rainy day. Or - to put this in the language of economists - he will aim to build budget surpluses even after the deficit has been eliminated.

This is part economic plan, part strategy for winning the next election.

Economically, Osborne believes that given the high level of Britain's debt, it is right to continue paying it down even if the budget deficit is eliminated.

Politically, it allows him to promise tax cuts once the recovery is established as the Tory way to tackle squeezed living standards; to share the proceeds of recovery (an echo of his pre-crash pre-election promise to share the proceeds of growth) and to challenge Labour to spell out their long term spending plans (he is highlighting the fact that Labour have only pledged to match the Coalition's current spending plans for one year - the year of the next election)

This then is what he meant by the extract of his speech released last night

"We know it's not over.

Until we've fixed the addiction to debt that got this country into this mess in the first place

Until we can say: never again"