Boris Disavows Treasury’s Expected OBR ‘Central Scenario’ for Virus

Far from the more optimistic tone from Boris’s boffins last week that the UK could be back to normal by April, as Guido revealed yesterday, Rishi’s statement relied on OBR numbers expecting a high level of restrictions lasting until June. Under the OBR’s expected “central scenario”, the UK would be stuck in tiers one and two for a further seven months, forbidding household mixing for swathes of the country. Yet when Guido’s story was raised with the PM last night by Tory MPs at the 1922 Committee, he swiftly disavowed the forecast…

One Tory MP who logged on to the virtual meeting tells Guido that Boris rejected the OBR analysis, despite the Chancellor’s numbers being based on it earlier that day. The Prime Minister instead insisted the outlook was more optimistic. When the Chancellor was asked about the OBR’s assessment he himself relied on this morning on the Today Programme, Rishi was keen to downplay its importance, stressing the nature of the forecast and that in reality “no one knows”. Which is odd because the forecast is of what restrictions the Government will choose to put in place – something completely down to choices the Government will make, not unknowable external forces.

One excuse as to why Boris and Rishi are now disavowing the forecasts they relied on yesterday. could be that the forecast was produced before the Oxford vaccine announcements been made. The OBR told the Daily Mail last night that “we would be moving towards the upside” of the three scenarios in light of the Oxford vaccine news, and a new forecast will set that out “by the end of the financial year“. Which is odd, because when the forecast was made, both the Pfizer and Moderna vaccine successes had been announced. Presumably the OBR has a reason to be more pessimistic than the Government…

mdi-timer 26 November 2020 @ 14:49 26 Nov 2020 @ 14:49 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
OBR Scenario Shows 35% GDP Fall This Quarter

A new scenario just released by the OBR shows the cataclysmic effect Coronavirus could have on the UK’s economy, including a 35% fall in GDP in the second quarter of 2020 and a possible 10% rise in unemployment, up to two million. The biggest quarterly contraction on record…

The figures from the OBR aren’t designed to be predictions, rather they model a Coronavirus scenario illustrating the possible effects on the economy and public finances.

Whilst the model includes a rapid bounce back to growth, it also sees public sector borrowing reaching £273 billion this fiscal year, amounting to 14% of GDP. The largest single-year deficit since the second world war, and 3% higher than the deficit inherited by the Tories in 2010…

mdi-timer 14 April 2020 @ 12:30 14 Apr 2020 @ 12:30 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
OBR Forecasts 600,000 New Jobs and Continuous Growth Over Next Five Years

The OBR has released its March forecast alongside Philip Hammond’s Spring Statement today, predicting 5 more years of continuous growth. They also forecast 600,000 jobs being added to the economy. George Osborne is going to be waiting for his half a million job losses for a while yet…

The OBR have also upgraded their assessment of public finances for the next five years, with a lower projection of Government borrowing than in their last report before the Budget last year. Hammond has announced that the much-anticipated Spending Review will be launched before the Summer recess – if a Brexit deal goes through…

mdi-timer 13 March 2019 @ 13:12 13 Mar 2019 @ 13:12 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Green Taxes Set to Treble

Green subsidies – levied on consumer bills – will treble by 2021-22, The Office for Budget Responsibility says. The controversial tax take will rise from £4.6 billion in 2015-16 to £13.5 billion in 2021-22. The cash will be spent on subsidising economically non-viable energy, such as solar and wind farms. Earlier this week Centrica, the parent company of British Gas, got into a public spat with the government, blaming green levies for putting an extra £149 a year on household bills. The firm said green taxes caused “significant pressures” on pricing and that there was no option but to pass costs on to customers. Centrica CEO Ian Conn said:

“It is transmission and distribution of electricity to the home and government policy costs that are driving our price increase.”

A spinner for the Department for Business, Energy and Industrial Strategy (BEIS) claimed: “A number of independent reports have shown energy policy costs make up a relatively small proportion of household energy bills.”

Days later the government’s own forecaster admits green policy costs will treble…

mdi-timer 4 August 2017 @ 09:36 4 Aug 2017 @ 09:36 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
OBR Debunks Remain Predictions on Growth, Unemployment

obr

Worth pointing out that yesterday’s OBR forecast comprehensively debunked several of the key claims made by the Remain campaign. During the referendum Osborne and the Treasury told voters 500,000 jobs would be lost in the aftermath of the Brexit vote. The OBR’s numbers are hugely more optimistic, they say unemployment will only go up by 100,000 by 2020 and that employment will rise too: 500,000 more jobs will be created. During the referendum the Treasury forecast a Leave vote to cause growth to plummet to -0.2% in 2017, and there to be a recession. The forecast is now +1.4% and no recession. What’s more, Project Fear’s threats that Brexit would cause permanently lower growth have been rubbished – the rate of growth will return to the long run average by 2019 say the OBR. Remember this when Remainers claim they told you so…

mdi-timer 24 November 2016 @ 09:30 24 Nov 2016 @ 09:30 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments