Paul SeddonPolitical reporter

Reuters

Downing Street has denied Rachel Reeves misled the public about the state of the public finances ahead of this week’s Budget.

In the run-up to Wednesday’s statement, the chancellor repeatedly talked about a downgrade to the UK’s predicted economic productivity that would make it hard for her to meet her spending rules.

But in a letter to MPs sent on Friday, the chairman of the Office for Budget Responsibility (OBR) revealed a forecast of higher wages – which she had not mentioned – would help her meet the rules.

The Conservatives have accused Reeves of giving an overly pessimistic impression of the public finances as a “smokescreen” to raise taxes.

Tory leader Kemi Badenoch said the letter showed Reeves had “lied to the public” and should be sacked.

In a letter to the Commons Treasury select committee, OBR chairman Richard Hughes revealed that he told the chancellor on 17 September that the public finances were in better shape than widely thought.

The letter also reveals that on the 31 October, the OBR told the Treasury it was on course to meet its main rule of not borrowing for day-to-day spending, albeit by £4.2bn, less than the £9.9bn in “headroom” she had left herself last year.

On 4 November, Reeves used a rare pre-Budget speech in Downing Street to warn the UK’s productivity was weaker “than previously thought” and that “has consequences for the public finances too, in lower tax receipts.”

Then, on 10 November, she told BBC Radio 5
Read More

Paul SeddonPolitical reporter

Reuters

Downing Street has denied Rachel Reeves misled the public about the state of the public finances ahead of this week’s Budget.

In the run-up to Wednesday’s statement, the chancellor repeatedly talked about a downgrade to the UK’s predicted economic productivity that would make it hard for her to meet her spending rules.

But in a letter to MPs sent on Friday, the chairman of the Office for Budget Responsibility (OBR) revealed a forecast of higher wages – which she had not mentioned – would help her meet the rules.

The Conservatives have accused Reeves of giving an overly pessimistic impression of the public finances as a “smokescreen” to raise taxes.

Tory leader Kemi Badenoch said the letter showed Reeves had “lied to the public” and should be sacked.

In a letter to the Commons Treasury select committee, OBR chairman Richard Hughes revealed that he told the chancellor on 17 September that the public finances were in better shape than widely thought.

The letter also reveals that on the 31 October, the OBR told the Treasury it was on course to meet its main rule of not borrowing for day-to-day spending, albeit by £4.2bn, less than the £9.9bn in “headroom” she had left herself last year.

On 4 November, Reeves used a rare pre-Budget speech in Downing Street to warn the UK’s productivity was weaker “than previously thought” and that “has consequences for the public finances too, in lower tax receipts.”

Then, on 10 November, she told BBC Radio 5
Read More