Office for Budget Responsibility

Baroness Noakes Excerpts

Monday 14th June 2010 Lords Chamber

[Lord Sassoon]

My Lords, the noble Lord, Lord Desai, has made an important point by drawing attention to the huge illumination, to use his word, of the public finances and the forecast going forward. He makes some interesting technical points about how some of the data should be forecast. All I can say is that, if Sir Alan Budd is not listening now, I will take back the noble Lord’s points and relay them to him, as it is for him to decide how he lays out his forecasts in future.

[Baroness Noakes]

My Lords, I congratulate the Government on their commitment to a level of transparency that we have never before seen. This is a wonderful first move. We should also congratulate the Office for Budget Responsibility on producing in a very short time what I think people have to accept is a very impressive document.

Does the Minister agree with my noble friend Lord Higgins that the report is a depressing read? Nowhere is it more depressing than on the fact that the structural deficit is much worse than we were previously led to believe. That makes the call from the noble Lord, Lord Eatwell, for an apology quite inappropriate, as we were led to believe that the structural deficit was different. The noble Lord, Lord Eatwell, has tried to pick holes in these calculations, but does my noble friend agree that realism and transparency will serve the people of this country much better than unwarranted and hidden optimism, which is what we had from the previous Government?

The Office for Budget Responsibility will be an important part of the way in which Budgets and economic management are handled going forward. It is clearly important that the status of the office is put on to a permanent footing as soon as possible, so that we do not have to take the criticisms from the Benches opposite about its independence and so on. Will my noble friend say when we are likely to get legislation to achieve that?

[Lord Sassoon]

I am grateful to my noble friend Lady Noakes for her remarks and I echo her congratulations to Sir Alan Budd, the OBR and the Treasury officials who have been moved across into the OBR, as what they have produced in such a short time is a remarkable achievement. I agree that the report makes a depressing read in that it exposes how threadbare the inheritance from the previous Government was. On the other hand, it makes a stimulating and positive read, in the sense that we can use it as a basis on which to construct credible Budgets from now on. I also agree that it is important to put the OBR on to a permanent footing. Legislation will be brought forward as was set out in the Queen’s Speech.