Yes, the headline of the document is that the deficit needs to be cut more quickly than current government plans, that the budget must be balanced by 2015-16 rather than 2018.

However, the document also warns against cuts this year.

The CBI’s director general pointed out to me that in his view there was already quite a sharp cut to public sector spending pencilled in by the chancellor. The bulk of this additional deficit reduction could come in and after 2012.

So that’s 1-1 between Mr Darling and Mr Osborne.

However, there was acute criticism of changes coming in April 2011, the 1 per cent hike to employers’ national insurance. That is a £4.5bn tax hike, a direct tax on jobs, at a time of concern about job creation, and is payable whether you are a City bank creaming in billions or a broke butcher in Barnsley.

Understandably, the CBI would rather that part of the existing deficit reduction plan instead came from greater restraints on current public spending.

But before George Osborne claims a 2-1 points victory, there was also some heavy criticism for a landmark Tory policy. His idea of lowering the headline rate of corporation tax is broadly welcomed as a target. However, the abolition of the R&D tax credit and other allowances to fund this measure is most definitely not.

So broadly speaking I’d say that from the business lobby’s perspective it is, so far, a high scoring draw.

Indeed scratch the surface of the CBI’s submission and you see that they could have signed either or both of the opposing economists’ letters that littered Fleet Street’s mailbags in February.

In essence they see the main parties’ approach to fiscal policy as broadly interchangeable. The issue of whether to cut in 2010 or not is a “second order issue” says Richard Lambert, the CBI boss.

He even told me that apparent market concerns about a hung parliament were “overblown”, because all three parties had the same approach on reducing the deficit.

So is this a false fiscal fight that we are commentating on ahead of the election? I think of it as a heavily overlapping Venn Diagram.

Yes George Osborne could cut earlier and faster. And Alistair Darling is planning to hold off for a year and cut more slowly. But the bulk of the main parties approach to fiscal policy does overlap.

It is entirely conceivable that if Mr Darling remains chancellor he will announce a more stringent programme of deficit reduction. Likewise, if George Osborne is Chancellor, and there happens to be a double dip this year, I severely doubt that his 2010 cuts will be anything other than token.

It is up to both the Labour and Conservative parties to refine their policies to make the electoral choice more distinctive. At the moment both parties are conniving in exaggerating their differences like two weary boxers clinging on to each other in the closing stages of a long fight.

That means far more detail on spending cuts and tax rises from all sides before the election.

A strangely upbeat crew. Intriguingly, I did not detect a great lust for political change. Stranger too I detected a strong, though not universal degree of confidence in the present Chancellor, but more curiously I did find a universal unease about the management and leadership of Conservative economic policy.

So have these industrial and commercial titans gone native? Are the embers of New Labour somehow their plaything? Has the prospect of additional gongs to their knighthoods, peerages and the rest, lost none of the lustre of old, despite parliament’s present low repute? Or are we witnessing a strange high level revolution unfolding out there in the Square Mile.

Has Labour quite simply, despite all, become the party of Big Business? Has politics been turned on its head, with the Tories the now self-declared party of “workers” co-operatives?

I concluded the mood rested on something a little more solid in terms of respect than the above. Multi-national bosses do not elect governments, but so near an election I was, as I say, intrigued.

As regards bullying – not one of my informants was shocked by the “Brown revelations” .

Every one of them expressed the view that the reported behaviour is entirely consistent with high-pressure leadership activity.

Churchill was conjured as were a number of industry bosses whom I won’t name. Indeed the thought was expressed that if the prime minister of the day did not lose his rag at regular intervals – bang the table, tug the lapels, and the rest there would be something seriously awry.

There was a sense that tugging the Whitehall blancmange into focused activity was enough to test anyone’s patience.

 He is Dr Johannes Witteveen, Managing Director of the IMF in 1976 when the Labour government ran out of money.

IMF bail-outs have been in the news, with some European leaders wanting the money men from Washington brought in to sort out Greece.

The French and the Germans are for now standing firmly against that. The IMF has already bailed out Hungary, Lativia and Iceland in this crisis.

David Cameron has muttered darkly, shouted sometimes, that it could all happen again here.

So I popped over to The Hague to ask the man who pulled the strings back in 1976 what it’s like when the IMF comes to town. Could it happen again?

I also caught up with Denis Healey to ask what it’s like going “cap in hand” to the money men. 

As it happens, he was in Downing Street being given lunch by Alistair Darling, who was not, I’m assured, checking on how you fill in the application forms.

Denis Healey remains bitter that, as he puts it, the Treasury “got the bloody figures wrong” and exaggerated Britain’s economic malaise.

Dr Witteveen – dubbed “Dr. Weetabix” by Private Eye back in 1976 – suggests that’s delusional and that Britain needed to learn it couldn’t keep spending its way out of trouble and that the IMF medicine – giant cuts, tax rises and general austerity measures (coming again soon to a cinema near you) – was essential to stabilise the markets and the pound. 

You can hear them both on tonight’s Channel 4 News at 6.30pm.

And I earlier I was interviewing the Chancellor at number 11 as the UK limps unconvincingly out of its Great Recession.

At the Treasury they are adamant that they have communicated a ‘cautious’ line pretty consistently. The flaccid 0.1 per cent figure was not a surprise they say, some had been privately expecting flat
growth.

When pushed on why on earth it is the UK that has the longest, deepest recession and the tamest post recession growth, the Chancellor blamed the size of the UK financial sector.

He did acknowledge the unflattering comparison with other economies: ‘It’s taken us longer to come out of recession’ he told me.

But he pointed to other measures of the economy: ‘unemployment is a lot less than America… there are grounds for being confident’.

Above all it seemed to reinforce the rhetoric and the arguments, that he has seemed to play down in recent weeks, in favour of a softly softly approach to the deficit.

‘I’ve always that we need to start to reduce by 2011 when recovery is established – today’s figures show the sheer folly of starting to cut away significant government support just at the time when growth has return albeit modestly – the Tory approach’.

As for other senior ministers, Jack Straw and Harriet Harman have been in the weekly meeting between the government and the backbenchers’ parliamentary committee.

It just broke up in the last few minutes after quite a lot of hostile remarks from backbench Labour MPs about the Hoon-Hewitt project.

Number 10 insists it is not expecting any big resignations, nor any ministerial minnows.

But Geoff Hoon is a seasoned operator. Would he really fire off just one shot without choreographing a second one?

Has someone pulled out of the second shot? Was it never properly agreed?

A Brown aide tells me we should be getting a statement soon from Jack Straw which is fully supportive of the prime minister.

The relevance of these three ministers I mention is that they have appeared in speculation that, over Christmas, they pondered whether to make a move on the PM.

It had to be presented from Labour HQ rather than the Treasury, so politicised was its content. The headline: Labour has costed a net £34 billion of Conservative tax cuts, reversal of tax rises and spending rises.

It is undoubtedly a fiscal double-flip. Labour is simultaneously claiming that the Tories would endanger the public sector, cutting the deficit too quickly, yet at the same time that the Tories have squirreled away a £34 billion fiscal expansion.

To be clear the £34 billion number is a highly partisan assessment of every Conservative suggestion, whether or not it is a formal pledge. That is the so-called “credibility gap” with the PBR numbers announced by the chancellor last month.

On top of that, if George Osborne really did want to cut the deficit faster, then that would require further tax rises or spending cuts to the tune of £26bn, per year of faster deficit reduction.

Labour strategists say they have been “remorselessly conservative” in their assessments (e.g. by not costing the grandparents tax credit) and that they expect this document to stand up to “six months” of election scrutiny (is there an election timing hint in there?).

David Cameron responded that he’d found £11 billion of mistakes in 11 seconds of analysing this document and that it’s “complete junk from start to finish”.

My sense is that this document is not the usual guff. Clearly it has been unfair on the Tories by costing many Conservative murmurs that are not pledges, for example a promise to avoid the 2011 increase in National Insurance as a “number one priority”.

Neither does this type of micro-analysis of opposition aspirations reflect too well on the government’s own unwillingness to hold a spending review at Budget time, before an election.

Such a review would reveal clearly that many government departments face double-digit falls in spending. Having said that, there are quite substantial detailed multi-year costings of a variety of election-sensitive issues raised by the Conservative front bench.

There clearly are a host of spending-sensitive opposition hints from which they derive political capital, yet which they have not yet costed. So the £34bn number should be taken with a small vat of salt.

But the general point that the opposition have vaguely made suggestions to various audiences that would cost billions possibly tens of billions, is fair enough.

This is the phony war made possible in the absence of firm tax and spend plans. And this phoney war will develop into an election battle over supposed Conservative plans to raise VAT up to or possibly over 20 per cent.

Yet it’s difficult for Labour to sustain this line of attack without being clear about their own plans.

That’s one way get rid of the budget deficit. And a very Merry Christmas to you too, Alistair!

And on that seasonal note, this blog is taking a break. Thank you for reading and have a Merry Christmas.

There can be no doubt about the weighty burden of debt afflicting Britain’s younger generations. But there is a remarkable fact about yesterday’s numbers.

Despite the pre-emptive warnings from the credit ratings agencies, the chancellor dared to increase, not decrease borrowing – compared to April’s Budget forecast – over the next three years before a slight relative payback in 2014-15.

Incredibly he chose to raise taxes, but then spent all of that money, and he spent the material bonus derived from higher stock and house prices, and he spent even more than that too. So he raised taxes, and chose not to pay off debt. I would call that a snub to the credit rating agencies.

On top of that, his rhetoric was unapologetic about the need not to contract immediately. He seemed to be referring directly to Richard Koo’s argument about Japan, made to me on Monday’s show, in his PBR speech.

The chancellor said: “When Japan tightened prematurely in the 1990s it pushed the economy back into recession, making debts and deficits much higher, not lower.”

Koo said on Channel 4 News that the Japanese deficit reduction plan which aimed to cut 15 trillion yen from Japan’s borrowing in 1996 ended up adding 16 trillion yen instead. See the full interview here.

On top of that Mr Darling made pointed remarks about the need for an “orderly” deficit reduction. So it was a clear message: yes we’ll cut the deficit, but in our own time, thank you.

And here’s the crucial fact: the gilt markets did not hammer UK sovereign debt yesterday, although this morning there was a bit of a delayed reaction. Having said that, the ratings agencies said the PBR had “not materially changed” the picture on the UK’s credit rating.

In many ways the Treasury and the chancellor got away with something that I had thought might “test the market” more.

Perhaps they were just relieved that there was no further stimulus package announced, as is the case in Japan. Maybe they are waiting until a post-election flash of clarity and honesty. But as it stands, it is almost impossible that the UK will actually lose its AAA credit rating before the election.

We’ll find out today from the IFS about the savage cuts implied, though not outlined, by yesterday’s numbers to non-priority areas such as transport, housing, and universities. There is a clear democratic argument for a spending review to occur with the budget.

But I’m increasingly of the opinion that this PBR has given the opposition a serious headache. Markets didn’t care about the extra debt as much as the opposition has claimed. And as opaque as the Labour deficit-halving strategy is, the Tories have to find even more cuts or tax rises to cut it faster.

So as a matter of basic mathematics, George Osborne’s will necessarily be as opaque as Darling’s, and then some. That is why the Tory frontbench have opposed absolutely nothing that the Chancellor announced yesterday.

If Mr Osborne is serious about faster deficit reduction he will have to choose to either 1) de-prioritise schools/police, 2) savage transport/housing even more or 3) raise taxes.

Labour will hammer them on an alleged plan to raise VAT I’m told. Liam Byrne is already flashing around a suggestion that quickening the pace of deficit reduction by one year will cost £26bn in spending cuts or tax rises, which he is convinced will come from a secret Conservative VAT rise.

Tory insiders say they “don’t recognise” Liam Byrne’s £26bn number and that it’s “ridiculous”.

The other option, of course, is to cut back benefits even more. As Labour have already bagged the “easy” tax rises, and some of the “easy” spending cuts, that’s where I bet that an Osborne Treasury would have to find the money to pay down the national debt more quickly.

Numbers would be great. From both parties.

Off to the IFS now, live tweets from one-ish on: twitter.com/faisalislam

Watch out for the international reaction to the bonus tax. The Wall St Journal, bible of capitalism says bonus tax is “entirely justifiable response to the sector’s failure to exercise self-restraint”.

France has just introduced it. US Democrats absolutely love it: Darling, I love you http://bit.ly/8lY1oI.

“First considered take: This budget is a continuation of tax and spend. Treasury chosen to tax more but not pay off deficits at all #c4budget 3 minutes ago from web”

“Vince Cable: Economy was built on sand, being rebuilt on sand. Good point. #c4budget”

“Diff between Tories and Labour. Lab will ‘halve’ deficit over parliament. Tories will cut ‘a large part’ of it – ie more than half #c4budget”

“So is Mr Osborne: going to eliminate the structural deficit over 4 years rather than 8? Thats double the spending cuts #c4budget”

“Ha! Tories have bought Google adwords such as Budget and Treasury that link to the conservative website. cunning. #c4budget”

“The killer rabbit ‘Reverse Rabbit’ out of the hat — additional 3bn Nat insurance tax rise #c4budget”

“There is really no excuse not to have a spending Review at the same time as the Budget now. #c4budget”

“Fiscal non-event. no real change to deficits at all … actually borrowing up slightly over 4 years despite higher oil/stock mkts #c4budget”

Tweet your questions and comments including #c4budget in the Tweet – we’ll be monitoring them throughout the afternoon and putting a selection to our economics correspondent, Faisal Islam (@faisalislam).

The economics team I work with – Faisal and his backroom wizard, Neil Macdonald, tell me, and you, that today’s UK pre-budget report will stand or fall on the whims of a handful of economists across the world.

Not any old economist but largely those who work for the so-called “ratings agencies”.These are the people who will run their slide rules over Alistair Darling’s measures announced today – it is largely upon their judgements that the fortunes of the pound and the external assessment of the health of the UK will ride.

What perplexes me is why these ratings guys are still in business at all. And they are mainly guys.

These are the very folks, working for “reputable” ratings agencies who accord Lehman Brothers and the massive AIG, RBS, HBOS and the rest, “triple A” ratings shortly before they all went bust.

If we want ratings at all, and I have no idea whether we do or we don’t, it seems to me that these agencies are an entirely unhelpful entity.

The job should be given to an accountable global body which can be held to account for its judgements.

But then this science itself – if science it be – is itself far from precise. It is often psychological, atmospheric, abstract, and subject to circumstances that are almost impossible to predict.

So, is it time to call a halt to the existence of ratings agencies?

Come forth one of you and defend your right to exist on this, er, sensitive day!