Having tied himself down with two self-imposed rules for public borrowing, the chancellor manages to surprise and amaze Labour MPs every year by balancing the books while producing enough goodies to keep the malcontents on the backbenches happy.
This time, the pressure really is on. Backbench MPs are hoping that at the end of this year's performance Mr Brown will throw off his chains and reveal that he is an old-fashioned tax-and-spend Labour chancellor at heart.
The government has promised to deliver world-class public services, and even the most arithmetically challenged backbencher can figure out that, with the public finances already set to dip into the red, large increases in health and education spending will have to come from somewhere.
As always, the chancellor has a few tricks up his sleeve. Like all the best escapologists, he has made a great show of how tight his chains are, issuing a pessimistic forecast for the public finances in November's pre-Budget report.
In fact, the chancellor has a record of overdoing the gloom and this year looks to be no different. He is forecasting that he will need to borrow £2.5bn this year, but with one month to go in the fiscal year City economists think he is more likely to notch up a small surplus of perhaps £2bn.
In previous years Mr Brown's windfalls have arisen from the Treasury raking in more tax revenues than it expected. With the economy slowing and company profits dwindling, this year's surplus is more likely to be the result of underspending throughout Whitehall. Labour's decision to stick to the Conservatives' eye-wateringly tight spending plans in its first two years seems to have scarred government departments which regularly fail to spend all the money the Treasury allocates.
Although the extra cash in the kitty should give Mr Brown more scope next year, the fiscal rules are likely to start to bite later if he fulfils MPs' wishes for a generous public spending round this summer. He is already closer to breaching his golden rule than at any time since he stated it in summer 1998.
Mr Brown's forecasts show that by 2003/4 cyclically adjusted borrowing will be 0.3% of GDP in surplus. In past budgets, Mr Brown has allowed for a fatter margin as a precaution; as several former chancellors have discovered to their cost, the public finances can be extremely volatile.
Moreover, Mr Brown has raised expectations by increasing spending in the last two spending rounds, at a rate of 3% per year. This summer's round is even more critical because it covers the period up to the next election, and Labour has made clear that it wants voters to judge it on delivery of better public services.
The Institute for Fiscal Studies estimates that, to keep pumping money into the public sector at the current rate and restore his safety margin, the chancellor will need to increase taxes by £9bn from 2004.
Despite the concerted effort by the prime minister and the chancellor to soften up the electorate for tax rises, Mr Brown is unlikely to announce any increases for this fiscal year. He does not need to un der his own rules and, with the economy still in a fragile state, it would be a risky move.
The great escapologist could try another tactic. He might foreshadow tax rises for next year and in a single bound leap free of his fiscal constraints while meeting backbench MPs' aspirations for higher spending on health and education.
It could even be presented as the best medicine for an unbalanced economy - taxes on consumers to take some of the steam out of spending and allow the Bank of England to give manufacturers a breathing space by easing rates. The great Houdini would win a round of applause for that trick.
This is the start of a six-part series setting the scene for the Budget
Guardian Unlimited © Guardian Newspapers Limited 2001
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