Treasury launches inquiry into leak of growth forecasts
A leak inquiry will take place following reports that economic growth forecasts have been reduced by the government’s financial watchdog.
Bloomberg reported that the Office for Budget Responsibility (OBR) had reduced its growth forecasts in data sent to Chancellor Rachel Reeves last week.
Reduced growth could force the government to cut further spending or increase more taxes.
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The next forecast is set to be published in March – with the process supposed to remain confidential until that point.
The inquiry was confirmed by James Bowler, the most senior civil servant in the Treasury.
He told the House of Commons Treasury Committee: “We will undertake an inquiry, and I’m happy to communicate the outcome of that.”
The government’s attempts to grow the UK economy have proved difficult since the election last year, and businesses have complained about measures introduced in Ms Reeves’s first budget.
Part of Labour’s plan involves increasing house building and development, although these plans were not included in the forecasts for last October’s budget.
Mr Bowler sought to play down the fact that a leak inquiry was happening meant that what was reported by Bloomberg was true.
Asked by committee chair Meg Hillier about the inquiry, the civil servant appeared to indicate about 50 people in the Treasury would have been able to see the forecasts.
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Bank of England issues growth blow
He said an investigation into OBR officials would likely also happen, although the body is independent of government.
Downing Street has tried to remain bullish about the economic situation.
A Number 10 spokesperson said: “In recent weeks and months, the [Organisation for Economic Co-operation and Development] and the [International Monetary Fund] have upgraded our growth forecast over the next three years.”
They added: “The government remains relentlessly focused on growth as the only way of sustainably raising living standards and delivering the investment that we need in our public services.”
Read more:
Growth forecasts cut in blow for Reeves
Starmer has growth battle on his hands
Reeves calls in bank chiefs for growth talks
Both bodies mentioned slightly increased their growth forecasts, but they still remain below 2%.
Last week, the Bank of England halved its growth expectations for the UK – saying it would only increase by 0.75% in 2025, before increasing to 1.5% for the next two years.
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The OBR’s forecasts have a more direct impact, as the Treasury use them to measure if they are meeting their fiscal rules.
GDP figures are set to be published tomorrow, which will show how the UK economy was performing to the end of 2024.
A top Downing Street aide has resigned after sending sexually explicit messages about independent MP Diane Abbott, Sky News understands.
Paul Ovenden, who was the director of strategy at Number 10, is understood to have left the role on Monday after a number of instant messages from 2017 became public.
Sky News understands he did so to avoid becoming a “distraction” for Sir Keir Starmer, just days after he was forced to sack the UK’s ambassador to the US – Peter Mandelson – over his ties to disgraced financier Jeffrey Epstein.
The messages, exchanged between Mr Ovenden and a female colleague, contained the graphic retelling of a conversation he reportedly overheard about Ms Abbott while at a party.
The former aide has alleged these were not his original words, but said he “deeply regrets” sharing them.
He said: “I really, deeply regret my sharing this story, and the hurt and embarrassment its publication will cause.
“Accordingly, I have brought forward my resignation to today as I do not want to be a distraction from the government’s work.”
Diane Abbott
It is understood Mr Ovenden announced to colleagues before the summer recess he was leaving his role, and had planned to leave “quietly and quickly” sometime this month.
However, in the wake of the publication of these messages, Mr Ovenden “brought forward” his resignation to today.
The messages, exchanged with a female colleague and seen by Sky News, described a game of “shag, marry, kill” the aide overheard while at a party in May 2017.
This involved explicit descriptions about suspended Labour MP Ms Abbott.
A Number 10 spokesperson said: “These messages are appalling and unacceptable.
“As the first black woman to be elected to parliament, Diane Abbott is a trailblazer who has faced horrendous abuse throughout her political career.
“These kinds of comments have no place in our politics.”
Sky News has contacted Ms Abbott for comment.
The latest Number 10 resignation comes as Sir Keir admitted he never would have appointed Lord Mandelson to the post of UK ambassador to the US if he had known what he knows now about the extent of his association with Epstein.
Speaking publicly for the first time since he sacked Mandelson last Thursday, the prime minister explained that a “due diligence process” was conducted before he was appointed to the post in February.
“I knew of his association with Epstein,” Sir Keir said.
“But had I known then what I know now, I’d have never appointed him.”
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‘Had I known then, what I know now, I’d have never appointed him’ Starmer said.
Just days before Lord Mandelson was sacked, Angela Rayner resigned as deputy prime minister and housing secretary after admitting she did not pay enough tax on her second home.
She also quit as deputy leader of the Labour Party, an elected post.
Sir Keir’s second-in-command admitted to Sky News political editor Beth Rigby on the Electoral Dysfunction podcast that she should have paid the higher rate of stamp duty on a home she bought in Hove, East Sussex, as it was her second property.
UK crypto and payments groups urged the Bank of England to drop plans to cap individual stablecoin holdings, claiming the move would be costly and hard to enforce.
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