A leak inquiry will take place following reports that economic growth forecasts have been reduced by the government's financial watchdog. Bloomberg reported that the Office for Budget Responsibility (OBR) had reduced its growth forecasts in data sent to Chancellor Rachel Reeves last week. Reduced growth could force the government to cut further spending or increase more taxes. Politics latest: PM and Badenoch in rare agreement.
The next forecast is set to be published in March - with the process supposed to remain confidential until that point. The inquiry was confirmed by James Bowler, the most senior civil servant in the Treasury. He told the House of Commons Treasury Committee: "We will undertake an inquiry, and I'm happy to communicate the outcome of that.". The government's attempts to grow the UK economy have proved difficult since the election last year, and businesses have complained about measures introduced in Ms Reeves's first budget.
Part of Labour's plan involves increasing house building and development, although these plans were not included in the forecasts for last October's budget. Mr Bowler sought to play down the fact that a leak inquiry was happening meant that what was reported by Bloomberg was true. Asked by committee chair Meg Hillier about the inquiry, the civil servant appeared to indicate about 50 people in the Treasury would have been able to see the forecasts.
Please use Chrome browser for a more accessible video player. He said an investigation into OBR officials would likely also happen, although the body is independent of government. Downing Street has tried to remain bullish about the economic situation. A Number 10 spokesperson said: "In recent weeks and months, the [Organisation for Economic Co-operation and Development] and the [International Monetary Fund] have upgraded our growth forecast over the next three years.".
They added: "The government remains relentlessly focused on growth as the only way of sustainably raising living standards and delivering the investment that we need in our public services.". Read more:Growth forecasts cut in blow for ReevesStarmer has growth battle on his handsReeves calls in bank chiefs for growth talks. Both bodies mentioned slightly increased their growth forecasts, but they still remain below 2%.
Last week, the Bank of England halved its growth expectations for the UK - saying it would only increase by 0.75% in 2025, before increasing to 1.5% for the next two years. Follow our channel and never miss an update. 👉Listen to Politics At Jack And Sam's on your podcast app👈. The OBR's forecasts have a more direct impact, as the Treasury use them to measure if they are meeting their fiscal rules.
