Back in 2003, then chancellor Gordon Brown changed the target the Bank of England used to measure inflation, stripping housing costs from the main measure and excluding the cost of housing, which even now makes up about a third of total spending! It’s absolutely misleading to not take it into account. More importantly, the idea that housing costs were not even considered makes sense given the data: if non-housing costs were relatively stable yet house prices were booming, it would make perfect sense for the BofE to keep interest rates relatively low rather than raising them to curb the boom. And of course this is what they did, with the predictable results – the housing bubble, and then the crash. Yet again we had simply a case of fudging the statistical backdrop to make the situation appear different to reality for short term electoral gain, or incompetence, or both!

Peering through the new Programme for Government under Banking we have this gem:

We will work with the Bank of England to investigate how the process of including housing costs in the CPI measure of inflation can be accelerated.

It goes to show that the smear campaigns against George Osborne have been untrue; he is not a chancer, he is a chancellor. (To use that old Labour pun.)