Friday 30 September 2022

Letting them know who's boss


When George Osborne set up the ‘independent’ Office for Budget Responsibility 12 years ago, he surely intended it as a way of locking in orthodox thinking and making it harder for any future government to follow a significantly different path. That was in the days when the Conservative Party was the upholder of financial orthodoxy, but had only a slim grip on power in coalition with the Lib Dems. The possibility of a Labour government looked realistic and constraining the freedom of movement of that party would have looked, to a Tory, like a really cunning plan. Although Osborne admitted that having an outside body conduct an independent review of his budgets placed limits on him as well, it’s doubtful that it really worried him a great deal (it was, after all, his own fiscal orthodoxy that he was attempting to set in concrete); and it is certain that he never expected that his OBR would find itself in direct conflict with his own party’s government. But fortune-telling has always been a dodgy business at the best of times, and it’s easy to believe that he didn’t expect the fiscal fetishism of the Conservative Party of 2012 to turn into the doomsday cult of 2022.

In any event the ‘independence’ is more illusion than reality, when push comes to shove. The members of the Budget Responsibility Committee are appointed by none other than the Chancellor of the Exchequer, and it’s an iron rule of any power relationship that he who appoints can always find a way of unappointing if he needs to. But recent events have shown the limits of the ‘independence’ in another way as well: it turns out that the OBR can only produce a forecast if the government asks for one, and are expressly forbidden from publishing one if the government does not. And whilst the underpinning legislation requires the government to request that a forecast be produced for any budget, that which might look like a budget is not a budget within the terms of the legislation if the government simply decides to call it something else.

Various apologists for the government have come out with all sorts of excuses as to why the OBR couldn’t have produced a reliable forecast (as though such a thing actually exists in the first place) for this particular package, despite having managed it for previous budgets. The excuses have varying levels of credibility ranging from infinitesimal to zero but the inverse ratio between credibility and the absolute certainty with which some Tories present them is a wonder to behold. Not Truss herself, of course, for whom words are simply words, devoid of any meaning or expression. The OBR itself says it could have produced an analysis – indeed, that it even had one more or less ready for issue which it was not allowed to publish. Whether the government was aware of the content, or could even be bothered to look, is a currently unanswered question; the general assumption is that it wouldn’t have liked what it saw. The Boris Johnson approach to bad news from advisors (hands over ears and hum the English national anthem) is alive and well in Downing Street.

Today’s meeting between the members of the Budget Responsibility Committee and the Chancellor – to which the PM has invited herself as well – has been billed as an attempt to calm the markets by reassuring the OBR that the government is planning to set out how the apparent hole in the government’s finances will be filled. Perhaps. But given the arrogance and the absolute confidence that Truss and Kwarteng have that they know better than anyone else, it’s surely equally possible that their intention is to remind the OBR who’s in charge, and explain to them what they think so that they can go away and write it up as an 'independent' report. Given the way that they’ve reiterated time and time again over the past few days that their plans are the brilliantist ever, it’s hard to believe that there will be any contrition on display. Truss and Kwarteng are still wielding their spades with gusto – the enthusiastic hole-digging seems unlikely to suddenly stop today.

1 comment:

dafis said...

Journos in UK have been quick to spot the extent to which Putin uses,abuses, language when covering up his misdeeds. However we have our own exponent of that dark habit now, and Ms Truss did not need any time at all to get in at the deep end and misrepresent anything that she elected to adopt as policy. No difference at all between her and the Russian leader except she's a lot nearer to us and capable of far more immediate damage, short of the big bomb itself arriving one day.