Is public spending going up or down? A confusing war of figures has broken out between the two main parties, as Labour seeks to claim that it is the party of “investment”, supposedly defending the country against Conservatives who it says are bent on making cuts. David Cameron claimed yesterday that the Government was planning to cut spending by 7 per cent. Gordon Brown denied this, and proudly read out the extra billions that the Government will spend until 2013.

“Public spending in our country is rising,” he said, “and it’s going to continue to rise.” It was a bit surprising, given that his Chancellor has claimed to have reduced overall public spending and that projects such as community hospitals are clearly being axed.

What has been going on? Mr Brown’s numbers were right, but he was relying on his inner conjuror to create an illusion. Public spending is indeed set to rise — in absolute terms and as a proportion of GDP. But it turns slightly negative from 2010, once forecast inflation is taken into account.

And after the Government has paid higher benefits necessitated by unemployment, the recession and the interest on spiralling public debt (as calculated by the Institute for Fiscal Studies), then most departments will face real cuts of 7 per cent from 2010 to 2013, the Tories say. If the Conservatives get in and increase health spending by more than inflation, as they have promised, cuts of 10 per cent would be needed, they say. Andrew Lansley, the Shadow Health Secretary, got into hot water for saying so yesterday. But he was following the logic of the Government’s numbers.

This may all sound academic, as Labour is unlikely to be in power by 2013. But it is the ground on which the next election will be fought. We are used to accountants playing tricks, but not prime ministers. No party can pretend that the hole in the public finances can be filled without higher taxes or spending cuts.

Times Recommends

• We have kit and leadership. Let’s go
• Behind the scenes at the biggest deal
• Conferences — what a waste of money