Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential impact of the use of different economic forecasts by (a) the Bank of England and (b) the OBR on (i) monetary and (ii) fiscal decisions.

Monetary policy is the responsibility of the independent Monetary Policy Committee (MPC) of the Bank of England, so the government rightly does not comment on the conduct of monetary policy. The MPC publishes its forecasts on a quarterly basis to inform its monetary policy decisions.

The Office for Budget Responsibility (OBR) is the UK government’s independent official forecaster and publishes economic and fiscal forecasts at least twice per year alongside fiscal events. The OBR provides independence, transparency and credibility via its assessment of the economic and fiscal position and as the official forecaster it is right that it is the basis for government fiscal policy decisions.

The MPC and the OBR have different responsibilities, so it is right that they produce their own forecasts. The MPC’s forecasts reflect policy announced by the government and fiscal assumptions from the OBR and HM Treasury.