Most of the shortfall in the pace of reduction of public borrowing arose from the economy turning out to be weaker than expected. The rest – amounting to about a third of the total – was due to a drop in the tax to GDP ratio, ie the tax-take. This itself reflected the disproportionate growth of low-paying jobs (which generate less tax) and the effects of the substantial rises in the personal tax allowance.

When the Conservatives came to power last year, Mr Osborne set himself the tougher objective of bringing total borrowing down to zero3532872bby the end of this parliament. This seemed to be pretty plausible, but recent borrowing numbers have called it into question. Indeed, over four months, the 12-month rolling sum of public borrowing has levelled off at about £80bn, or 4.5pc of GDP.

What has gone wrong? The main reason for the disappointing performance is the slowdown in the growth of tax receipts, and that reflects the weaker performance of the economy – again. Over and above this, low inflation hasn’t helped either. This has restrained VAT receipts and excise duties. Meanwhile, the modesty of pay rises has restrained the growth of income tax and national insurance payments. Admittedly, low inflation has also helped to keep interest rates and bond yields low and that has contained the Government’s debt interest bill.

As long as the economy continues to grow reasonably well – which I expect – then I am not seriously worried about the public finances. Before too long, inflation will start to rise again and so will the growth of GDP measured in money terms. Continued real economic growth of 2pc to 3pc would see the deficit falling, and the ratio of government debt to GDP dropping back gradually to more acceptable levels.

David Fuller's view

Here is a PDF of Roger Bootle's article.

I think this is a plausible scenario but there are always risks.  The main one in my opinion would be further divisions and chaos within the European Union.  The second would be uncertainty over a possible UK ‘Grexit’.   Meanwhile, the UK has sound national governance and an entrepreneurial economy.