While all the attention in the past five years has been on austerity and spending cuts, much less has been written about the vital other side of the equation, namely tax revenues. However much the chancellor cuts spending, if tax revenues decline he is running up a down escalator.

The Institute for Fiscal Studies recently published its own analysis The changing composition of UK tax revenues. In short, it found that while revenues as a share of national income plummeted after the fiscal crash in 2007/08, by 4.4% in 2008/09 and 5.5% in 2009/10, it is forecast to return to its pre-crash levels by 2020.