There was much surprise when John McDonnell announced on 25 September that Labour would be voting in favour of George Osborne's new fiscal charter. The target of an absolute surplus by 2020, which the charter mandates, appeared at odds with the shadow chancellor's support for borrowing to invest. At Labour conference, he all but admitted to Newsnight that his backing for the document was merely symbolic.

Now, ahead of tonight's PLP meeting and the vote on Wednesday, Labour has revoked its support altogether. In a letter to MPs, McDonnell wrote: "In the last fortnight there have been a series of reports highlighting the economic challenges facing the global economy as a result of the slowdown in emerging markets. These have included warnings from the International Monetary Fund’s latest financial stability report, the Bank of England chief economist, Andy Haldane, and the former Director of President Obama’s National Economic Council, Lawrence Summers.

He added: "I believe that we need to underline our position as an anti-austerity party by voting against the charter on Wednesday. We will rebuff any allegation of being deficit deniers by publishing for the debate our own statement on budget responsibility. We will set out our plan for tackling the deficit not through punishing the most vulnerable and decimating our public services but by ending the unfair tax cuts to the wealthy, tackling tax evasion and investing for growth.”

McDonnell has cited global economic conditions to explain the U-turn. But some in Labour suggest that he simply failed to realise that Osborne's new Fiscal Charter mandated an absolute surplus, rather than merely a current budget surplus. By reversing its position, Labour has denied the SNP a chance to outflank the party from the left and has appeased backbenchers who opposed the leadership's stance. But it has also made it far easier for the Tories to level the "deficit denier" charge that McDonnell's earlier support for the charter was designed to avoid.