Will scapegoated OBR chief wield the knife on Reeves? Richard Hughes ‘knows where bodies are buried’ as Chancellor fights to cling on over Budget lies
Rachel Reeves is bracing for a storm of Budget lies to escalate again today following the sacking of the Treasury watchdog.
Speculation is swirling about the intentions of Richard Hughes, who dramatically resigned as OBR chairman after months of tensions with the chancellor.
This departure was apparently linked to the exceptionally early release of budget documents due to a technical glitch.
But the independent body was locked in a feud with Ms Reeves and her team over the way forecasts were implemented ahead of last week’s financial announcement.
This came to a head last week when Mr Hughes took the unusual step of deciding which economic forecasts would be presented and when, revealing that Ms Reeves had cited dire figures even after being told the government was on track for a surplus.
The Treasury responded by saying they had received assurances that such transparency would not be ‘usual’ practice.
Speculation is swirling about the intentions of Richard Hughes, who dramatically resigned as OBR chairman after months of tensions with the chancellor
Rachel Reeves prepares for Budget lies storm to escalate again today
Last week Mr Hughes took the unusual step of revealing the timetable for which economic forecasts would be presented and when, revealing that Ms Reeves had been talking about dire figures even after being told the government was on track to run a budget surplus.
Ms Reeves is said to see Mr Hughes as a ‘brick wall’ for refusing to include small effects of trade deals in forecasts, while Keir Starmer made clear yesterday he was furious over the decision to hold a long-term productivity review.
The remaining senior officials at the OBR will give evidence to MPs this morning. Mr Hughes will not be able to attend but may still choose to speak.
The economist, who once observed that he was suited to the role of watchdog because he ‘knew where the bodies were buried’, could be devastating for Ms Reeves if she revealed anything about the behind-the-scenes wrangling.
The OBR’s anger was flagged in the report on the Budget leak yesterday; Non-executive directors Baroness Hogg and Dame Susan Rice launched a veiled criticism of ‘deliberate’ leaks. This appeared to be a nod to the Treasury’s perceived briefing campaign.
‘As we approach the delivery of the Budget, any leaks regarding the OBR’s forecasts, whether accurate (as in this case) or inaccurate, unintentional (as in this case) or deliberate, are to be greatly deplored,’ the foreword said.
‘They need to be taken very seriously by the institutions where leaks occur. ‘As evidence of how seriously the OBR takes this matter, we have stated in previous months that the OBR remains committed to its confidentiality policy.’
In a letter to the Chancellor and the House of Commons Treasury Committee yesterday, Mr Hughes said he took ‘full responsibility’ for the embarrassing mistake.
Following Mr Hughes’ resignation, Conservative Party leader Kemi Badenoch claimed Ms Reeves was using the outgoing OBR chief as her ‘human shield’.
“As a result of the budget chaos, someone has resigned… but it’s not Rachel Reeves,” Ms Badenoch shared on X.
‘The Chancellor is trying to use the OBR’s seat as a human shield. But I won’t let him. ‘Why is it ALWAYS someone else’s fault with Starmer and Reeves?’
Reform Britain leader Nigel Farage MP said: ‘Whatever the OBR’s failings, they did not deliberately attempt to mislead the British public.
‘The wrong person resigned today, it should have been Rachel Reeves.’
Mr Hughes’ exit announcement appears to have been timed to the close of financial markets on Monday, perhaps because of fears it could spark a crisis.
His exit also means he will no longer be questioned by MPs on the Treasury Committee about the Budget process on Tuesday morning.
In a letter to the Chancellor and the House of Commons Treasury Committee on Monday, Mr Hughes said he took ‘full responsibility’ for the embarrassing mistake
Criticism of the Chancellor has also spread beyond Opposition parties.
Senior Labor MP Graham Stringer said Budget preparations were ‘chaotic and appalling’ and predicted both the Prime Minister and Chancellor could be sacked next year if they do not rectify the situation before crucial local elections in May.
He told LBC radio: ‘I think if the elections are this bad and there’s no improvement in the day-to-day business of the government and the medium-term assessment, I can’t see how they can stay.
‘This government came into office with high hopes from almost all Labor MPs, and those hopes have been dashed.’
