Budget Responsibility? Fiscal Transparency?

Another day, another clutch of disastrous stories about the economy. The New Economics Foundation rightly describes the Office for Budget Responsibility as "not fit for purpose", and calls for its "wholesale reform". But who would be the Foundation's proposed Office for Fiscal Transparency? Whom might Rachel Reeves realistically appoint to it?

Giving up democratic political control of monetary policy has been a disaster. Without a manifesto commitment, Labour farmed out monetary policy. To make austerity permanent, the Liberal Democrats forced the creation of the OBR, although they were pushing at an open door with George Osborne. The Conservatives created the Economic Advisory Council out of thin air. Yet on none of those occasions have the salaries of the First Lord of the Treasury, of all other Treasury Ministers, and of all senior Treasury civil servants, been halved, as in each of those cases they should have been. It is difficult to see why those people should be paid anything at all once the Budget Responsibility Bill had become an Act and given the OBR the last word on everything. The same OBR, that is, that Reeves would have us believe had kept her in the dark about the "black hole".

The annual tax take is more than one trillion pounds. £20 billion is not a "black hole". This is just an excuse not to do things, although quite possibly while putting up taxes at the same time. And which taxes? A tax of one to two per cent on assets above £10 million could abolish the two-child benefit cap 17 times over, while merely taxing each of Britain's 173 billionaires down to one billion pounds per head would raise £1.1 trillion, an entire year's tax take. But neither of those is going to happen. Keir Starmer thinks that if anything could be done about child poverty, then it would have been done by now. He has said that.

Labour Rightists shrieked for months about the need to withdraw the Winter Fuel Payment and to cut benefits to the sick and the disabled. Yet no Labour MP voted against the partial and inadequate, but nevertheless substantial, reversal of those measures. Outriders such as Lewis Goodall are now making shrill calls for 100 per cent inheritance tax. Is he looking for a seat? Is he angling for a Downing Street job? Or is he just ridiculous? In any event, expect a lot more of this.