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Sophy Ridge, Ed Conway and Sam Coates quiz budget watchdog chief · INSIGHT TODAY

• 0:00
  Speaker 1: Can now speak to the Chair of the Office a
• 0:02
  Speaker 1: Budget Responsibility at Richard Hughes. Thank you for being with us.
• 0:08
  Speaker 1: I know you'd obviously be expecting on days like this
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  Speaker 1: to be talking about the measures and the budget, but
• 0:12
  Speaker 1: we do have to start, of course with that extraordinary
• 0:16
  Speaker 1: accidental release of effectively the entire budget. Can you just
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  Speaker 1: taught me through what happened when you first found out
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  Speaker 1: about it? Who told you? So?
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  Speaker 2: We've discovered that our forecast has been accidentally uploaded onto
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  Speaker 2: our website. It was a technical error and an error.
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  Speaker 2: As soon as we found out about it, we took
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  Speaker 2: action to take it down. We've apologized to the Chancellor,
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  Speaker 2: to members of Parliament. We've initiated an investigation, the report
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  Speaker 2: to our oversight Board, to the Treasury and the Treasury
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  Speaker 2: Committee of Parliament, and I'll be acting on those recommendations.
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  Speaker 1: How did you feel when he found out that it
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  Speaker 1: had been released by mistake?
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  Speaker 2: Obviously mortified. We pride ourselves in our professionalism at the OBR.
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  Speaker 2: We don't like these things to happen. We take budget
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  Speaker 2: security very seriously. Been initiated an investigation to find out
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  Speaker 2: what's happened, and we'll act on its recommendations as soon
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  Speaker 2: as they're Can I.
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  Speaker 1: Talk about it being taken down, because you say that
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  Speaker 1: that as soon as you found out, you took it down.
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  Speaker 1: I mean we were here in the studio when you know,
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  Speaker 1: the first snap came through from Routers. I think it
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  Speaker 1: was giving a statement about what the ABAR had found,
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  Speaker 1: and then you know ed Conway noticed that the market
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  Speaker 1: had suddenly gone completely crazy, obviously reacting to the to
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  Speaker 1: the league. And I guess I'm just wondering it felt
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  Speaker 1: like it took quite a long time for you to
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  Speaker 1: realize what had happened. Does that fair?
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  Speaker 2: We took action as soon as we found out about it,
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  Speaker 2: As soon as we were able to, we took it down.
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  Speaker 2: There was a high volume of traffic onto our website,
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  Speaker 2: and so we took it down as soon as we could.
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  Speaker 1: Can you taught me through a little bit more about
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  Speaker 1: what how did you find out? When? Who told you?
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  Speaker 1: What happened? When you found.
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  Speaker 2: Out, Sophie, we've initiated an investigation. I think it's important
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  Speaker 2: that investigation roonds its course. It will report to the
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  Speaker 2: t the Treasury Committee, and be overseen by our oversight board.
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  Speaker 2: We'll publish the report if you'll have all the answers
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  Speaker 2: to your critier questions about what happened in the laws
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  Speaker 2: of that report, and we will like them immediately.
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  Speaker 1: Who's who's running the investigation.
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  Speaker 2: It will be overseen by our oversight Board. It will
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  Speaker 2: report to the Treasury Committee. Will need to appoint people
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  Speaker 2: to do it and we will. We'll announce more details
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  Speaker 2: in due course. The Governance Board about office by response boards.
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  Speaker 1: So you don't know who's going to run it. Yeah,
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  Speaker 1: you was like board the Okay, if you.
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  Speaker 2: Consider yours like Board of the Treasury was like Board
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  Speaker 2: of the OBR is Baroness Sarah Hogg and David Sarah
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  Speaker 2: and Dames Susan Rice.
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  Speaker 1: Have you considered your position?
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  Speaker 2: There is an investigation that we will do. It will
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  Speaker 2: report to the Treasury and the Treasury Committee. And I
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  Speaker 2: always serve at the pleasure of the Treasury and the
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  Speaker 2: Treasury Committee.
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  Speaker 1: So is that is that it feels like you're just
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  Speaker 1: kind of waiting for other people to tell you what
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  Speaker 1: you should think on that.
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  Speaker 2: So we need to look into what happened to We
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  Speaker 2: need to get to the bottom of what happens. There'll
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  Speaker 2: be an investigation. There'll be a set of recommendations. It
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  Speaker 2: will report to the Treasury and the Treasury Committee, and
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  Speaker 2: based on the recommendations that report and the conclusions of
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  Speaker 2: the Treasury and the Treasury Committee, I will I serve
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  Speaker 2: at the confidence of them, and I will act on
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  Speaker 2: whatever they tell you.
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  Speaker 1: Obviously, watching Rachel Reeves deliver the budget, it felt very
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  Speaker 1: different from normal. It felt like, I guess all the
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  Speaker 1: oxygen have been sucked out of the room, and certain
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  Speaker 1: at the beginning it put him in a pretty difficult position.
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  Speaker 1: She was unable to frame the argument because everyone had
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  Speaker 1: seen the budget before she'd had a chance to actually
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  Speaker 1: deliver it. Do you feel, I guess a bit guilty
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  Speaker 1: because of what happened.
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  Speaker 2: We've apologize for what's happened, we apologize to the chance
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  Speaker 2: to remembers of Parliament, and we do want to get
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  Speaker 2: to the bottom this and make sure it doesn't happen again,
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  Speaker 2: and we'll update the public on the investigation as soon
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  Speaker 2: as we can.
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  Speaker 1: Okay, okay, Can I ask you quickly about the budget itself,
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  Speaker 1: but what is your kind of key takeaways? Because it
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  Speaker 1: feels like, I mean, does the extra head room, of course,
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  Speaker 1: but it does feel like quite a lot of the
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  Speaker 1: actual forecast, if it comes to living standards in particular,
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  Speaker 1: are pretty gloomy still.
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  Speaker 2: All right, So we've downgraded our forecast of productivity growth
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  Speaker 2: by about zero point three percentage points, so we've got
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  Speaker 2: the economy growing at one and a half percent over
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  Speaker 2: the next five years. That's slower growth than was in
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  Speaker 2: our previous forecast, so that itself puts a squeeze on
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  Speaker 2: living standards. And also the fact that taxes are going
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  Speaker 2: up through the form of freezers on thresholds and other
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  Speaker 2: increases in personal taxes also means that growth in living
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  Speaker 2: standards are slows over the forecast period from where they
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  Speaker 2: are now to around the quarter percent over the middle
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  Speaker 2: of the forecast. That's sifficantly lower than the one percent
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  Speaker 2: growth we've seen living standards in the recent past.
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  Speaker 3: Yes, hello, rig it, it's Sam, cos I've just got
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  Speaker 3: one question, sort of ironic that you're in trouble with
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  Speaker 3: the chances to stay because looking through the judgments that
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  Speaker 3: you've made, they're enormously in favor of this treasure. You've
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  Speaker 3: made some whopping great assumptions that the Treasury would be
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  Speaker 3: delighted about. Seem to have done a new turn on
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  Speaker 3: whether or not. You're going to sort of score cost
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  Speaker 3: the employment Rights bill. You promise you do that at
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  Speaker 3: the last fiscal event. You haven't done that today. You
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  Speaker 3: seem to have taken an assumption that welfare bill, the
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  Speaker 3: welfare bill is just going to fall of its own
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  Speaker 3: accord to the tune of maybe ten billion pounds. Did
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  Speaker 3: the Treasury get to you a bit and lean on
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  Speaker 3: you to make sure that you know the numbers are
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  Speaker 3: a bit more flattering than they otherwise might have been.
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  Speaker 2: No, our forecasts are always based on the independent judgment
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  Speaker 2: of the members of the Budget Responsibility Committee. We've downgraded
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  Speaker 2: productivity growth in this forecast, but despite that, because there
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  Speaker 2: are a lot of moving parts in a forecast. You know,
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  Speaker 2: while productivity growth was lower, you've also seen got higher
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  Speaker 2: inflation in the near term as well as higher growth
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  Speaker 2: in earnings in the near term, and those two factors
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  Speaker 2: actually offset in tax receipts the downgraded productivity, which is
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  Speaker 2: why you see higher tax receipts in our forecasting fair
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  Speaker 2: demarch despite lower real growth over the rest of the forecast,
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  Speaker 2: and the other questions you ask. One of the reasons, why,
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  Speaker 2: you know, why we haven't taken account of the Employment
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  Speaker 2: Rights Bill in this in this forecast? Is it at
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  Speaker 2: the moment? We don't have the details of that bill.
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  Speaker 2: In particular, some of the key details, like the probation
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  Speaker 2: period for new recruits is still going to be specified
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  Speaker 2: in secondary legislation, So it's something which we'll have to
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  Speaker 2: look at once we've got the details that we need
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  Speaker 2: to understand its impact on things like the labor supply
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  Speaker 2: and employment decisions.
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  Speaker 1: Can I just ask you a bit more of a
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  Speaker 1: kind of big picture question and to finish if I may,
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  Speaker 1: about the UK economy, because you know, we're all kind
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  Speaker 1: of feeling the impact of what's been a difficult time
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  Speaker 1: when it comes to you know, the cost of living,
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  Speaker 1: when it comes to economic growth, all that kind of thing.
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  Speaker 1: How resilient do you think the UK is at the
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  Speaker 1: minute economically?
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  Speaker 2: I think a big challenge the UK has is that
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  Speaker 2: it's got slow growth and it's got relatively high interest
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  Speaker 2: rates compared with its international peers. And what that does
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  Speaker 2: is put a big squeeze on households if they've got mortgages,
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  Speaker 2: and it also puts a big squeze on the government
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  Speaker 2: finances because it's revenues aren't growing as slowly as they
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  Speaker 2: used to in the past, and also the cost of
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  Speaker 2: the very large burden of debt that's built over time
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  Speaker 2: in the work of the financial crisis, in the work
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  Speaker 2: of the pandemic, in the work of the energy crisis,
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  Speaker 2: is now getting much more expensive. The country is now
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  Speaker 2: paying one hundred billion pounds per year servicing its debt,
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  Speaker 2: and its debt servicing costs as a share of GDP
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  Speaker 2: are up at levels which we haven't really seen at
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  Speaker 2: any point in the post war period.
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  Speaker 4: Richard Hi, it's ed conoy. Here are we are? We
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  Speaker 4: now a high tax nation? Where do we stand? I mean,
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  Speaker 4: one of the things this has done is to raise
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  Speaker 4: taxation quite a lot, hasn't it. And so can you
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  Speaker 4: give us a sense of both where we stand also
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  Speaker 4: where we've come just in the last few sets of
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  Speaker 4: fiscal policies.
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  Speaker 2: Yeah, So the tax burden since the pandemic is on
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  Speaker 2: track to rise by five percentage points as a share
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  Speaker 2: of GDP and reach a historic high of thirty eight
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  Speaker 2: percent of GDP by the time we get to the
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  Speaker 2: end of our forecast. You know, that moves us further
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  Speaker 2: away from from the sort of you know, the sort
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  Speaker 2: of American tradition of having sort of low tax and
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  Speaker 2: small governments, sort of closer to being a sort of
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  Speaker 2: continental style European country. We've still got a lower tax burden, however,
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  Speaker 2: compared to countries like France. But the tax burden has
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  Speaker 2: been rising certifically in the recent past. It's going to
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  Speaker 2: rise further, in particular, pushed up in our forecast by
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  Speaker 2: higher personal taxes, to reach an all time high by
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  Speaker 2: the end. You know, that partly reflects what I was
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  Speaker 2: talking about earlier, which is that the government's got a
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  Speaker 2: much bigger stock of debt to service, and so you know,
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  Speaker 2: two percent of GDP of that extra cost of cost
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  Speaker 2: of running the government is actually just coming from servicing
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  Speaker 2: its debts rather than delivering better public services, rather than
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  Speaker 2: of delivering better welfare benefits. So one of the reasons
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  Speaker 2: why that tax burn is being pushed up in the
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  Speaker 2: UK but also around the world is that governments have
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  Speaker 2: come into this decade with much higher debts than in
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  Speaker 2: previous years and service and that debt is pushing up
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  Speaker 2: on the tax burden while not also giving them the
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  Speaker 2: resources that they want to spend on better public services
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  Speaker 2: or deliver tax guards elsewhere.
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  Speaker 1: Okay, thank you very much and doing great to speak
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  Speaker 1: to you today. Thank you,