Reeves was left with £18 billion less headroom in her spending plans after the OBR made a whopping error in its projections for public sector net financial liabilities. According to Bloomberg, the quango originally found the headroom in 2028-2029 to be £62 billion. It was then corrected to just £43.9 billion. That’s 82% of the so-called £22 billion ‘black hole’…
Champions of the fiscal watchdog will be left red-faced again as gilt yields shoot up and the pound sees its biggest drop in 18 months thanks the OBR hugely overestimating how much fiscal headroom Reeves has. Though investor fears and markets reacting in a “violent way” aren’t likely to die down anytime soon. It’s probably not a good idea to tie your budgets to a forecaster that’s miscalculated UK public sector net borrowing by £53 billion every year since its establishment…
Paula Barker, Liverpool Wavertree MP backing Andy Burnham, told Times Radio there wouldn’t be trouble from the markets under Burnham:
“The markets will have to fall in line.”