All data is delayed
See More

UK fiscal watchdog rebuffs Cameron

Mar 08 2013 18:06

London - Britain's independent fiscal watchdog has criticised Prime Minister David Cameron for misrepresenting its position on the impact of measures aimed at cutting the national debt.

In a speech on Thursday, Cameron said Britain's economy had been hurt not by the government's deficit-cutting agenda but by problems in the eurozone and higher oil prices - a view he claimed the independent watchdog endorsed.

The claims were untrue, said Office for Budget Responsibility Chairperson Robert Chote.

"It is important to point out that every forecast published by the OBR since the June 2010 Budget has incorporated the widely held assumption that tax increases and spending cuts reduce economic growth," Chote wrote in an open letter published on Friday.

The rebuke is embarrassing for the government which set up the watchdog shortly after it came to power in May 2010. The government uses the OBR's projections as the basis for its budget planning and has made much of the credibility of its forecasts.

Chote's letter marks the first public clash between the watchdog and the prime minister, and will be seized upon by critics who blame the government's spending cuts and tax hikes agenda for the country's economic woes.

Britain is perilously close to tipping into its third recession in four years and was stripped of its triple A credit rating by Moody's last month.

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

david cameron  |  britain  |  economy


Read Fin24’s Comments Policy publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

We're talking about:


With infrastructure spending having been identified as one of the key focus areas of the National Development Plan, tradesmen will continue to play a critical role in growing the South African economy through their skills.

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

A 30% a month return on investment is:

Previous results · Suggest a vote