Isabel Hardman

A drop of 8.8 per cent in the number of students applying for university is surprisingly small, actually, when you consider the size of the hike in tuition fees. Still, the figures released today by Independent Commission on Fees prompted an angry response from Labour's Shabana Mahmood, who said: 'The Tory-led Government's decision to treble tuition fees at the same time as cutting funding for higher education is already putting thousands of people off university who otherwise would be eagerly preparing to start their courses.' It's easy to brand this drop of 37,000 applications from the 2010/11 academic year as a failure for ministers who have insisted that the fee rise should not put off prospective students.

Here's an interesting statistic from YouGov: more voters think the Conservatives have broken the coalition agreement than think the Lib Dems have failed to stick to it. When asked whether the Tories have 'mostly kept to their side of the deal they made in the coalition agreement', 51 per cent said no. For the Lib Dems, 45 per cent of voters thought the Lib Dems had stuck to the coalition agreement against 32 per cent who thought they had not. It's worth noting, though, that when you look at the breakdown of voting intention, it is Labour voters rather than Conservatives who think Nick Clegg's party have stuck to their side of the bargain. Fifty per cent of Labour voters say the Lib Dems have mostly kept the agreement, against 34 per cent who do not.

Sir Mervyn King's sporting jokes are almost as bad as the Bank of England's ability to publish accurate economic forecasts. As he unveiled the August Inflation Report this morning, the Governor said: 'Unlike the Olympians who have thrilled us over the past fortnight, our economy has not yet reached full fitness, but it is slowly healing. Many of the conditions necessary for a recovery are in place, and the MPC will continue to do all it can to bring about that recovery. As I have said many times, the recovery and rebalancing of our economy will be a long, slow process. It is to our Olympic team that we should look for inspiration. They have shown us the importance of total commitment when trying to achieve a goal that may lie some years ahead.

David Cameron made a spirited defence of school sport this morning when he appeared on LBC radio. Waving a sheet of paper triumphantly, the Prime Minister argued that the 20 school playing field sales that Michael Gove had signed off were actually schools that had closed, surplus fields and 'surplus marginal school land'. He also defended the decision to remove a compulsory target for all children to take part in two hours of sport a week: Well, look, we haven't done that, you know, sport is part of the national curriculum and we want schools to deliver sport and I think that's very important, but frankly, and we're putting a lot of money in, there's a billion pounds going into school sport over the next four years. But frankly if the only problem was money, you'd solve this with money.

George Osborne might not be feeling particularly comfortable with today's August Inflation Report from the Bank of England, as Sir Mervyn King is expected to slash the Bank's growth forecast for the British economy in 2012 from the 0.8 per cent it predicted in May to close to zero. This morning's announcement will also include some mildly good news for households, with the Bank due to predict a 2.1 per cent fall in inflation by the end of the year. This will bring inflation down below the two per cent target, which, as the CBI's Richard Lambert pointed out on the Today programme, will mean 'families starting to feel a little less squeezed'. High inflation leaves millions of families on frozen wages poorer as they struggle to afford rising costs.