Ex-OBR chief admits ‘enormous regret’
By politics.co.uk staff
The Office for Budget Responsibility’s (OBR) former head Sir Alan Budd has admitted amending figures shortly before prime minister’s questions had a “harmful” impact on the fledgling body’s reputation.
Chancellor George Osborne set up the OBR in a bid to remove suspected ministerial interference with economic forecasts prepared by the Treasury and used as the basis for government spending plans.
But the watchdog’s first three months were overshadowed by questions about its integrity, as it was based within the Treasury.
“We were completely independent,” Sir Alan, who stepped down as head of the OBR on Friday, told the Today programme.
“These people [Treasury economists] were reporting to us. We took all the judgements. We happened to be sitting in the Treasury building but that shouldn’t in any way question our independence.”
Ministerial reluctance to admit that spending cuts would lead to public sector job cuts sparked a row when a leaked Treasury memo revealed the government expected nearly 800,000 public sector workers to lose their jobs by 2015/16.
The OBR quickly provided prime minister David Cameron with revised figures suggesting just under 500,000 job losses, a significant reduction which the prime minister used to political advantage in the Commons.
“The fact it was PMQs was, as far as I was concerned, completely coincidental,” Sir Alan added.
“I was accused of naivety but it is certainly not our job to help the prime minister.”
He continued: “I enormously regret the effects it had on our reputation. Whether we could have done better, I don’t know. That was in some senses the most harmful event in terms of the press coverage.”
The OBR has advised the chancellor to move its office out of the Treasury building as a “symbolic gesture”. It has also requested the power to make Treasury forecasting appointments, Sir Alan said.
