Pre-Budget report disagreement between Treasury and No 10
I reported on last night's Ten O'clock News that the Treasury had wanted a tougher approach to public spending in this week's pre-Budget report in order to lend credibility to its plan to cut the deficit in half within four years.
The pre-Budget report actually increased the spending plans the chancellor had previously set out in his Budget, despite the fact that Britain faces the worst peacetime deficit in its history.
One reason for this is an aggressive public and private campaign by Ed Balls for a real-terms increase in school spending. He wanted to create a political "dividing line" with the Conservatives, who have promised to increase spending on health in real terms but have made no similar pledge about education.
The prime minister sided with the man who was his Treasury adviser during his long period as chancellor. Although Mr Balls didn't get as much as he wanted, he did get agreement for a 0.7% increase in school spending.
What's more, he secured a larger increase in spending on 16-19-year-olds. This was to fund the "September guarantee" of a place at school, college, in training or an apprenticeship for every 16-year-old who wants it - another a programme he has always claimed that the Tories oppose.
Sure Start - the third front in Mr Balls' attack on the Conservatives - has seen its budget protected from cuts.
Compare this with the Health Secretary Andy Burnham, who is having to sell a real-terms freeze in health spending from 2011, which some NHS managers have warned could lead to job cuts.
The disagreement between the Treasury and No 10 was not about the speed at which the budget deficit should be reduced. It was certainly not about Alistair Darling siding with the Conservatives in arguing for the deficit to be cut sooner and faster. It was, instead, about how to ensure that the government appeared to have a credible and convincing plan to achieve its stated objective of cutting the deficit in four years.
For those who like the detail, the PBR stated that current government spending will increase by 0.8% on average from 2011, and not by 0.7% as set out in the Budget.
However, money raised by the increase in National Insurance will - the Treasury claims - keep the government on course to cut the deficit in half in four years.