Proactive Investors - Financial forecasts by former Chancellor Jeremy Hunt will be probed by the Office for Budget Responsibility (OBR) after Labour said there was a £22 billion black hole in the Treasury’s finances.
Richard Hughes, the chair of the OBR, said the watchdog would be launching a probe into the forecasts given in the Spring Budget.
It marks the first time the OBR has undergone such a review.
Hughes spoke with the Treasury last week, where he was alerted to the “seriousness” of the issue, ahead of Chancellor Reeves’ speech on Monday.
Reeves issued a speech to Parliament on Monday, in which she said a £22 billion deficit in public finances would mean the cancellation of winter payments for some and the axing of its NatWest (LON:NWG) retail offer.
In response to these findings, Hughes told the Treasury committee: “This would constitute one of the largest year-ahead overspends against Departmental Expenditure Limits (DEL) forecasts outside of the pandemic years.
“The review will assess the adequacy of the information and assurances provided to the OBR by the Treasury regarding departmental spending.”
Reeves criticised the Tory’s handling of finances in her speech on Monday, claiming that Sunak’s government had “covered up from the country” the truth of the issues.