Expert Economy Commentary: Institute for Fiscal Studies

Read the IFS's full report on the manifestos here. The IFS is Britain's leading independent microeconomic research institute. The commentary that follows has been produced independently of Full Fact.

All of the parties want to cut the deficit, but few are willing to spell out exactly how they would do it.

At the last general election there was no clear difference between the parties in terms of the amount of austerity they were planning—the difference was in how quickly they would go.

This time, the Conservatives, Labour and the Liberal Democrats are all promising to 'balance the books', but this similar language masks potentially large differences in their fiscal plans. This is because Labour and the Liberal Democrats would balance a version of the books that allows borrowing for investment spending, whereas the Conservatives have said that they would aim for an overall budget surplus.

Labour's fiscal target allows them to impose less austerity but at the cost of somewhat higher levels of debt in the longer-run. But it is difficult to know exactly how different this alternative is from the Conservative offering, as Labour has refused to set out exactly what it considers to be the appropriate level of medium-term borrowing.

Taking the highest level of borrowing consistent with their announcements, Labour's plans might require only very small cuts to 'unprotected' public services to make the numbers in their plans add up. But if Labour wanted to target a larger surplus, then larger cuts would be necessary. Without knowing how much deficit reduction Labour is aiming for, one cannot say exactly what their plans mean for spending on public services.

Where Labour has been vague about how much it would borrow, the Conservatives have given very little information about how they would find the large cuts to spending that their plans imply. Their plans involve £12 billion of social security cuts, and £30 billion of cuts to unprotected departments. But they have outlined specific social security cuts of under £2 billion, and merely claimed that they would find £15—£20 billion of 'efficiency savings' in public services. Given that the unprotected departments have already faced budget cuts of around a fifth, it would be surprising if there were many efficiency savings left.

The Conservatives point to their record of cutting departmental spending over this parliament as evidence that they could achieve the same again. But one would expect the easiest cuts to have been made first, and the cuts over this parliament were in a context of stagnant private sector wages, which made it relatively easy to hold down public sector pay. If private sector wages pick up as they are expected to, then 'the same again' could be very difficult.

There are also areas on the tax side where the parties should really have given more information. The Liberal Democrats, the Conservatives and Labour have all outlined plans that rely on raising revenues from cracking down on tax avoidance, but their detailed plans are unlikely to raise anywhere near the billions of pounds they are hoping for.

If Labour win office, they would ask the OBR to do full 'costings' of the parties' manifestos. This could be very positive — perhaps this is the last election when the voters will be quite so in the dark. But doing it properly would mean that the parties would have to give much more detail of their plans than they are used to.