New Labour is often accused - and indeed has been accused again in the wake of the Budget - of having no story to tell. This notion that politicians need a story (did Harold Wilson tell one, as he rode to four general election victories?) may be thought a curious modern conceit, perhaps created by the failure of most contemporary novelists to tell any kind of story. But it is surely possible to plot one for new Labour. The schools and hospitals were in ruins, the poor reduced to destitution, their children hungry and unshod. But the people, their hearts hardened by the evil witch Thatcher, their eyes deceived by the tricks of the Grey Fairy Major, refused to vote for the Red Fairy Kinnock because they feared he would spirit away their hard-earned treasure. Then came the Smiley Fairy Blair who assured the people that they could keep nearly all their treasure but, if they gave just a little to the Prudent Fairy Brown, he would take such good care of it that their crops would flourish as never before, the hungry would be fed, the sick healed and the children clothed. The harvests were indeed rich, but the Prudent Fairy, fearful of famine, hoarded the food and, lest he anger the gods, gave handfuls to the poor only under cover of darkness. Some grumbled that they might as well go back to the Grey Fairy. The Smiley and Prudent Fairies told them to be patient; in any case, they said, the only alternative was a rather funny Bald Fairy. Then Winston, Lord of Fertility, warned that the people were dying and the Prudent Fairy relented. Milk and honey flowed, and everybody lived happily ever after.

Will that do? Well, up to a point. The most significant reaction to the Budget came from Jonathan Freedland, the Guardian columnist and the nearest thing to an ideological cheerleader that new Labour has in the national press. He complained that the Chancellor was "reacting to events rather than shaping them". Why this downbeat reaction from one normally so cheery? Because, as Freedland pointed out, the Budget's biggest headline - the extra £15 billion over four years for the NHS - was determined by what Tony Blair said on David Frost's sofa two months ago. Faced with what looked like an NHS crisis, the PM did not criticise doctors and nurses - as he has criticised teachers - for inefficiency. Instead, he acknowledged, as no leading minister had done for 20 years, that a public service needed more money. What now, asks Freedland, is to stop other ministers demanding cash ahead of reforms? May other services not be tempted to resist change knowing that, if they can get themselves into deep crisis, the money will then flow?

These, from Freedland's standpoint, are perfectly fair questions. But another set could be framed. The public has been led to believe once more that it can inhabit the kind of fantasy world created by tabloid newspapers in which it is possible to grumble simultaneously about rising taxation and a collapsing health service. It is perfectly true that taxation, as a share of GDP, has risen since Labour came to power. It is also true that spending is down as a proportion of GDP. What explains the discrepancy? The Chancellor has been paying off the debt accumulated during the Tory years, reminding us that the truly reckless governments of the recent past, both in Britain and America, have been on the right.

Are tabloid papers (and, incidentally, the Tories, but who cares about them?) advocating that Mr Brown run a higher fiscal deficit, with the inevitable consequences of higher interest rates, an even higher pound and even greater difficulties for British exporters? As it happens, the Chancellor can probably find the money for the NHS without risk, though some of the more grim-faced economists have their doubts. It will not always be so. Mr Brown may well have planned a further tax cut before the demands of the NHS became so insistent. The opinion polls were conclusive that people preferred the money to go to health. But how long before the demands for better public services clash with the expectations of low taxes? Should ministers, instead of always referring to the "tax burden", not start now to persuade people that, ultimately, they will get only what they pay for? May they not, in fact, be too timid on this score, given that, according to one recent international poll of 17 countries, the British are alone in wanting more spent on public services even if they have to pay more taxes?

The new Labour story is a good one, and Treasury ministers particularly can celebrate. But only fairy stories have happy endings. The people may yet have to give up some treasure.

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