Treasury broke rules of engagement with OBR, say MPs

22 Feb 16

Treasury ministers have interfered inappropriately with the work of the independent Office for Budget Responsibility and rules governing relations between the department and the economic watchdog should be clarified, MPs said today.

The influential Commons Treasury committee said it was “clear” that the chief secretary to the Treasury had requested non-factual changes be made to the OBR’s Economic and Fiscal Outlook. This is contrary to rules, which state that OBR reports are shared with the Treasury 24 hours before publication. In exceptional cases earlier access may be granted if it would be useful to include additional factual material from the Treasury.

However, in September, The Times reported that these rules had been breached. Emails obtained under Freedom of Information legislation revealed one Treasury official acknowledging “we haven’t strictly stuck to the ‘factual changes only’ requests so we’re giving you our full download and suggestions” in an exchange sent before the chancellor’s December 2014 Autumn Statement.

Following the The Times report, the Treasury committee requested copies of the correspondence for its own inquiry.

Its Reviewing the Office Budget Responsibility report, published today, found that some of the non-factual requests made by the Treasury were taken on board by the OBR, although they made no material difference to the publication.

Speaking as the Treasury committee issued a report on the episode, chair Andrew Tyrie said it “looks like a misjudgement”.

“It gives the appearance of a minister trying to lean on the OBR,” he said. “The OBR’s independence is hard-earned and easily squandered.”

Although conceding that little damage had resulted from the episode, Tyrie said it shouldn’t be repeated and called for a revised Memorandum of Understanding, which would make clear that early sight of the OBR’s work in the Treasury must be for fact-checking purposes only.

“Any requests or comments which could be construed as going beyond this should be brought to the attention of the chairman immediately and, if necessary, the chairman of the Budget Responsibility Committee,” Tyrie added.

In response, a Treasury spokeswoman said: “In establishing the OBR in 2010, independence and transparency was introduced to economic and fiscal forecasting process for the first time ever, with clear safeguards established to make sure this is protected.

“Officials and ministers have acted entirely properly, respecting that independence, at all times. We will respond formally to this report in due course.”

The committee also today criticised the choice of Sir David Ramsden to lead an independent review of OBR, saying that, as a Treasury official, he would not be able work independently of the government.

“[Ramsden] is bound by the civil service code, reports to the chancellor and has a duty to support the government policy of the day,” said Tyrie.

“The chancellor opposes the idea of the OBR costing parties’ manifesto pledges in the run-up to general elections. So it is not surprising that Sir David’s review considered it to be a bad idea.”

  • Vivienne Russell
    Vivienne Russell is managing editor of Public Finance magazine and

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