The OBR has blown apart the Treasury’s spin operation after Reeves U-turned on the Income Tax rise. It was a lie all along…
The OBR discusses its forecast process in the leaked report:
“The final pre-measures fiscal forecast, incorporating these later interest rate assumptions, was finalised on 30 October, and sent to the Chancellor the following day on 31 October. No further adjustments were made to our economy or fiscal forecasts after this, other than to take account of the impact of policy measures provided by the Treasury.”
After the FT U-turn story on the night of the 13th it was briefed to Bloomberg on 14 November that the reason for the U-turn was some fresh figures from the OBR:
“Chancellor of the Exchequer Rachel Reeves dropped a plan to raise income taxes at the budget later this month because she received better forecasts from the UK’s fiscal watchdog than had been widely anticipated, people familiar with the matter said… The OBR delivered its latest judgment this week, the fourth in a round of five preliminary forecasts it privately prepares for the Treasury ahead of budgets. People familiar with the matter said those showed that strong wage growth offset some of the downgrade in productivity that had been expected to constrain the chancellor.”
This was also before Reeves gave her insane “I’m going to raise Income Tax” speech on the 4 November. A political decision made out of fear for the backbenchers – weak, weak, weak…
