The head of the Office for Budget Responsibility (OBR) has warned that the government’s plans for “spending on public services” will “run out after March” in 2025.
Richard Hughes further warned that “we don’t know” how the government can make their spending plans add up as there is a lack of detail from the Chancellor’s Spring Budget.
Hughes told MPs at the treasury select committee on Tuesday it is “difficult” for the OBR to forecast the outlook for public finances accurately.
The chair of the OBR gave a scathing attack on the Treasury that November’s autumn statement was “a work of fiction.”
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Hughes told MPs, “There continues to be an imbalance between how much detail we have of the government’s tax plans, which support their objective of getting debt falling in five years’ time, and the amount of detail we have about its plans for departmental spending, which makes up 40% of total public spending.
“We know the government’s plans for National Insurance, we know the government’s plans for energy taxation in five years’ time.
“But what we know about government’s plans for spending on public services runs out after March of next year.
“It’s still lacking in detail, and difficult for us as forecasters to forecast, difficult for people to understand where the public finances are going, and it poses risks.”
Hughes insisted that Jeremy Hunt’s budget “only just” meets fiscal rules, which still has “significant risks.”
Hughes said, “The Budget was responsible in terms of the objectives the Chancellor has set for himself – in five years to get debt to begin to fall in share of GDP (gross domestic product).
“However, it does that with one of the narrowest margins any Chancellor has had against his fiscal targets.
“It’s the second narrowest of £9 billion and the very narrowest was this time last year.
“It’s meeting those fiscal targets, but only just.
“There are significant risks to the fiscal outlook weighing on that margin, not least the ones that are very likely to crystallise, such as fuel duty being frozen rather than indexed.”
