MPs have launched an inquiry into the role and performance of the Office for Budget Responsibility.
The all-party Commons Treasury committee will spend until the end of next month investigating the independent agency’s forecasting performance and impartiality. The panel will consider whether reforms are needed 15 years after the OBR was set up by George Osborne when he was Tory chancellor.
MPs on the committee are understood to be concerned after a row broke out between the OBR and the chancellor, Rachel Reeves, over budget briefings.
Richard Hughes, the OBR’s then boss, complained to senior Treasury officials in the run-up to the budget about a flurry of leaks he said had spread “misconceptions” about the agency’s forecasts.
He later cast doubt on claims that Reeves dropped plans to raise income tax in the budget because of rosier forecasts, pointing out that she knew about these well before the change of heart.
Hughes was forced to resign after the budget over the mistaken early release of budget documents in breach of rules governing the set-piece event.
Meg Hillier, the Labour chair of the committee, said MPs wanted to understand how the role and remit of the OBR had developed, and whether its relationship with the Treasury “could be reformed in order to ensure that it helps to deliver positive economic outcomes for the UK”.
She played down concerns held by the committee about potential bias at the OBR but said issues raised by the media, backbench MPs and the public should be tackled.
Hillier added: “The OBR is an important part of the UK’s fiscal framework. But it is often castigated by frustrated economists who feel they should be in charge because they shout the loudest. And we need only remember Liz Truss’s mini-budget to remind ourselves of what happens when the OBR is sidelined.
“This inquiry is not a stick to beat the OBR with. What my committee intends to do is have an honest conversation about what the watchdog does well and where it needs to do better. I hope this will provide a useful foundation for the new chair when they are appointed.”
Evidence must be submitted to the committee by 30 January.
