If we didn’t know it before last week, we surely do now. The economic policy landscape has changed. People will have different views on the period before the summer of 2007 — the longest run of non-inflationary growth in the modern era — but we are not going back there, at least in terms of policy.

Then, monetary policy was all about small changes in interest rates, a quarter-point at a time up or down for Bank rate, and those small changes had big effects.

Now, as we saw on Thursday, the big monetary policy decision was not on interest rates but whether the Bank of England’s monetary policy committee (MPC) would extend its £125 billion programme of asset purchases, so-called quantitative easing.

As I touched on here last week, the debate was whether to do it now or delay for a fuller discussion in August, when new economic projections will be available.

The MPC chose to delay, which does not necessarily mean this unconventional policy is over but does point to the beginning of a wind-down, consistent with evidence that the economy has stabilised.

On fiscal policy — tax and spending — we have moved from what was supposed to be a rules-based approach — meeting the “golden” and “sustainable investment” rules. Those rules, only borrow to invest over the cycle and keep public-sector debt below 40% of gross domestic product, were creaking long before the financial crisis, particularly the golden rule.

Now they have been replaced with a much more simple rule — get borrowing down from its current crisis level of 12.4% of GDP, £175 billion. All those debates about where we were in the economic cycle, so important when we had a golden rule, are now irrelevant for fiscal policy, though they may have an important role elsewhere, which I will come on to.

How easy will it be to pursue this new and very simple fiscal rule? The political fog may lift during the party conference season, but we may have to wait longer.

Alistair Darling, the chancellor, appeared to suggest last weekend he would be looking at a freeze on public-sector pay but quickly “clarified” his remarks. David Cameron, the Conservative leader, ran a mile when asked whether he would freeze the pay of public-sector workers. The votes of 6m public-sector workers are too important to trifle with, it appears.

Cameron’s promised “bonfire of the quangos” was a damp squib, even before the mid-week rains. If we are to have the biggest cuts in departmental spending in at least a generation, and possibly since the Geddes axe of the 1920s, both main parties are tiptoeing towards them.

Public-sector median full-time earnings are £523 a week, against £460 for the private sector. But suggestions pay should be frozen have produced a near-hysterical response. The argument for restraint is well put by John Philpott, chief economist at the Chartered Institute of Personnel and Development.

One way or another the public sector’s £158 billion salary bill has to be frozen or reduced. The more public-sector workers resist pay freezes, let alone reductions, the more that burden will fall on jobs.

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