From our sub-arctic chancellor this was a rip-roaring performance. Using all the arts perfected by Gordon Brown, he dazzled the house with his Autumn Statement. A chancellor should never be entirely candid. His job is to blame others for failure, to take credit for all successes, (no matter what their true origin), to engender confidence in the future and to attract cautious applause. George Osborne did all this.

The bad news came out first. There were sharp intakes of breath as he revealed that the economy had shrunk by 6.9 per cent during the credit crunch. And he offered a personal confession which, in accordance with tradition, was masked in flowery statistical language. At the start of his chancellorship, he admitted, he had hazarded some absurd forecasts about our economic prospects. He explained this rather large cock-up as follows:

‘Weaker than expected growth can be accounted for by over-optimism regarding net trade.’

Which all sounds fine and dandy, really. Over-optimism? It’s not even a fault. It’s a virtue. Osborne was simply too exuberant and fun-loving in those early days. He went skipping around the corridors of the Treasury whistling and trying on amusing hats, while knots of killjoy officials said tedious things like, ‘Chancellor, our exports to America have collapsed.’

Having dealt with this mistake, he reeled off screeds of Tory-pleasing announcements. Falling debt. Curbs on benefits. Rises in tax allowances. Extra latitude for SMEs to make investments. The benches behind him purred their approval. Labour were in a big sulk, opposite. Their hopes were pinned on the trusty Ed Balls who was heckling Osborne constantly.

At one point the chancellor seemed to argue that state employment should be scrapped altogether. Yes, he really did. He was crowing about Britain’s falling unemployment and comparing it with Spain’s – where only grave-diggers still work full-time – when this Thatcherite solecism popped out.

‘For every one less job in the public sector, two are created in the private sector.’

Clearly, the government should be banned from hiring anyone. Perhaps he’ll leave that for another day. He’s certainly keen to put the public sector on a crash diet. Today the state gobbles up 48 per cent of our wealth. Osborne will slim that to 39 per cent within five years.

He slipped a few treats to the LibDems as well. Osborne has long expressed enthusiasm for the Geldof-ish idea that Britain must atone for its economic success. Today, he was ‘proud to keep our promises to the world’s poorest’ and he reiterated his commitment to spending 0.7 of GDP on water programmes, dictator’s wives and other stimulants to global trade. Justine Greening, the minister responsible, bore the tidings with wintry stoicism. She’s had plenty of time to practise this ‘disbelieving forbearance’ face. You can try it at home too. Just imagine you’re Nicholas Soames receiving news that Fortnum’s has run out of foie gras.

By the time Osborne, finished, the Tories were cheering like hooligans. Ed Balls rose to reply and the Labour benches perked up. Balls, admittedly, faced an impossible task: to dance on the grave of the British economy while telling us all to join in and cheer. But he made Mission Impossible even harder by fluffing his opening declaration.

‘The national debt is not rising it is falling,’ he said. His muddle went unnoticed until he drew attention to it.

‘I’ll make that statement again’ he said, but he’d already lost the argument, the house and the confidence of his party.

He never recovered. His colleagues sat in glum silence through his faltering, mish-mash of a speech. Osborne’s turn came again. Instantly, he twisted the knife that Balls had plunged into his own reputation. He mocked Ball’s ‘falling debt’ blunder and said he’d just witnessed ‘the worst response I’ve ever heard.’

For Balls, this may be Stalingrad.

Tags: Autumn statement, George Osborne, sketch, UK politics