Mr. Sebastian Barnes:

Let me clarify that what we mean by "fiscal adjustment" here is exactly that, to close the deficit that would have opened up because incomes are permanently lower, but consumption, even once things like stimulus are unwound, would be at a higher level and there would be a gap, in the central deficit scenario, of 3%. That gap would need to be closed to get the debt-to-GNI* ratio back on the safer trajectory, and that would require an increase in taxation or measures around spending. It would not necessarily require spending cuts in nominal terms, but it could, for example, require freezing some forms of spending that would contribute quite a lot to closing that gap.

Regarding precise figures, and this may be an imprecision on our part and I apologise for that, we have three scenarios. The three years is more what we had in mind for the central scenario. If we were in the severe scenario, where more adjustment is needed, which is still, in aggregate, a third of what was required post crisis, the adjustment would not be spread over three years but spread over a longer time. Essentially, we believe that if interest rates stay low that will create a very favourable environment.

If the economy is recovering and growing at a steady pace by that point there should be a steady process of adjustment. The larger the adjustment, the more drawn out that process will be. To be absolutely clear, we do not have a period of adjustment of anything like the speed and severity of what happened in 2008 in mind. I apologise if that was unclear in our submission. That is absolutely not what we------