New power for the Office for Budget Responsibility

Among the planned 40 new bills announced in the King’s speech was a new law giving the Office for Budget Responsibility – the independent watchdog for public finances - the power to make an independent assessment of any single major tax and spending announcement or series of announcements over the course of a single financial year which make permanent tax or spending commitments worth more than 1% of the UK’s GDP or around £30bn.

The Budget Responsibility Bill is intended to ensure that any major future fiscal announcement will be subject to an independent assessment as a form of ‘fiscal lock’.

The OBR would alert the Treasury Committee in the event of a breach and notify them of their intent to publish an assessment or updated forecast. Any fiscal event accompanied by an OBR forecast in the usual...