Office for Budget Responsibility (Manifesto Audits)

Marcus Jones Excerpts

Wednesday 25th June 2014 Commons Chamber

[Nicky Morgan]

A lot less than the Labour party would have done had it been in government—[Interruption.] I thank the shadow Chancellor for the applause; that is very kind.

The creation of the OBR has meant that for the first time we have a truly independent assessment of the state of the nation’s finances. As the Chancellor noted in his Budget this March, it is to its credit that

“we now take it for granted that the figures presented at this Dispatch Box are not fiddled but fair and independent.”—[Official Report, 19 March 2014; Vol. 577, c. 781.]

By giving the OBR power to produce the official forecast, we have managed to remove many of the risks of the past and put the UK’s fiscal policy at the cutting edge of international best practice. The IMF said that

“strong fiscal institutions can enhance the credibility of consolidation plans”

and the shadow Chancellor wrote to Robert Chote affirming:

“Over the last three years, the Office for Budget Responsibility has become an established part of the framework of British economic policy with broad-based and cross-party support.”

I am sure that—it is not often I say this—we all agree wholeheartedly with the shadow Chancellor. It is also worth reminding right hon. and hon. Members that when the OBR was set up four years ago, it was deliberately designed to ensure that it would be independent and could steer clear of political wrangling. That independence and impartiality is crucial.

[Mr Marcus Jones (Nuneaton) (Con)]

My right hon. Friend is talking about the credibility that the OBR is building. Bearing in mind the political knockabout we have had today, the bogus calls from the shadow Chancellor, and the clear party politics being played, does she think that it would damage the OBR’s credibility if we entered into the plan that the shadow Chancellor is offering?

[Nicky Morgan]

My hon. Friend is absolutely right. One big issue that the Opposition have not addressed is that if this change were to be brought in without proper consideration, it would mean changes to the way civil servants work. That is something we value greatly in this country, and we would have to consider that issue when scrutinising any legislation.

[Mr Jones]

Is it not telling that the shadow Chancellor gave no commitment to carry on with this, should, God forbid, we get a Labour Government and a Labour Chancellor?

[Nicky Morgan]

I entirely agree with my hon. Friend, who, as usual, talks complete economic sense, unlike the Labour party.

As academic evidence noted at the time of the OBR’s creation, it is vital that there should not

“even be a scintilla of doubt…about the OBR’s independence and impartiality, as negative perceptions may undermine the OBR’s reputation, requiring a major effort at changing such perceptions”.

Unfortunately, the Opposition’s proposal not only presents a risk to that impartiality, but raises several difficult practical questions, which I shall go through briefly.