Economics: Reform of the fiscal event calendar and the Office for Budget Responsibility

Ministerial submission

To: The Chancellor of the Exchequer

Issue

1. The Office for Budget Responsibility’s accidental early publication of the full November 2025 Budget forecast, and the Treasury Select Committee inquiry it prompted into the OBR’s first fifteen years, together create an occasion to reform the fiscal event calendar and the OBR’s own remit. This submission concerns whether to act now, and if so how, or to await the Committee’s conclusions.

Background

2. The OBR was created by the Budget Responsibility and National Audit Act 2011 to produce economic and fiscal forecasts independently of the Treasury, ending the previous practice of the Treasury producing its own forecasts, which had been criticised as subject to political pressure. It publishes an Economic and Fiscal Outlook alongside each fiscal event and formally assesses the Government’s performance against its own stated fiscal rules. This institutional separation is widely credited with strengthening the credibility of UK fiscal forecasting relative to the pre-2010 position, a foundation this submission does not propose to disturb.

3. In 2016, the then Chancellor moved primary tax and spending decisions to a single Autumn Budget, with a Spring Statement intended as a non-fiscal economic update rather than a second fiscal event. This discipline has repeatedly eroded in practice, with Spring Statements accumulating policy content over time; both a Spring Forecast and an Autumn Budget again took place in the 2025–26 cycle. You have stated your wish to move to genuine single-fiscal-event discipline, consistent with International Monetary Fund recommendations, a position the Institute for Government has also recommended since its 2017 Better Budgets report, but this has not so far been given legal rather than administrative force.

4. The Government’s current fiscal rules bind against a forecast horizon extending several years ahead, and the headroom retained against them has recently been unusually tight by historical standards — around £10 billion at recent points, against an average of roughly £30 billion since 2010. Because small changes in economic assumptions can move measured headroom by billions of pounds within that horizon, Chancellors across multiple governments have faced a recurring structural incentive to calibrate policy tightly to the OBR’s own central forecast rather than to a more robust margin of safety, a feature of the rules-and-forecast system itself rather than a fault specific to any one Chancellor or administration.

5. In response to the September 2022 mini-Budget, in which the then Chancellor announced measures worth over 1% of GDP without commissioning an OBR forecast, an amendment to the 2011 Act, in force from 15 October 2024, introduced a “fiscal lock”: any measure, or combination of measures, assessed as “fiscally significant” — broadly, an effect of at least 1% of GDP within the five-year forecast period — must now be accompanied by an OBR assessment, whether or not the Chancellor of the day requests one.

6. On 26 November 2025, the OBR’s full Economic and Fiscal Outlook became accessible via an unprotected link on the OBR’s own website shortly after your Budget speech began, well ahead of its intended release, prompting confusion in the Commons chamber and a rapid market reaction. An investigation led by Ciaran Martin, former head of the National Cyber Security Centre, found that basic protections — passwords, randomised URLs — had not been used, that two configuration errors in the OBR’s publishing software went unrecognised, and that the underlying weaknesses were likely pre-existing, with evidence that the March 2025 forecast had been prematurely accessible in the same way. The Government has since moved to publish future market-sensitive OBR material through HM Treasury’s GOV.UK platform, which is built for embargoed release, rather than the OBR’s own site.

7. This incident is the immediate trigger for the Treasury Select Committee’s ongoing inquiry, launched in December 2025 to mark fifteen years since the OBR’s creation, examining its forecasting accuracy and impartiality over that period and inviting views on how its role, remit, and relationship with the Treasury should be reformed; the evidence window closed at the end of January 2026. You have not yet indicated whether the Government intends to act ahead of the Committee’s own report, or to treat it as the primary vehicle for reform of the matters addressed in this submission.

The General Case

8. The case for acting now rather than waiting for the Committee rests on three grounds:

• (a) the November 2025 publication failure is a matter of financial stability as well as institutional embarrassment, and the immediate security response need not wait for the Committee’s broader conclusions to be confirmed and, where necessary, extended;
• (b) the headroom-gaming problem identified at paragraph 4 is structural and has recurred across multiple Chancellors and governments, suggesting the design of the rules and forecast horizon, rather than any single administration’s judgement, is the more durable target for reform;
• (c) the repeated erosion of single-fiscal-event discipline despite consistent Chancellor-level commitment to it across several administrations suggests reliance on convention alone has not worked, and there is limited reason to expect it to succeed now without a change of mechanism.

9. The case against acting now rests on three grounds:

• (a) the Treasury Select Committee’s inquiry exists specifically to produce an authoritative, cross-party assessment of OBR reform options; pre-empting it with Government-led reform risks duplicating or conflicting with its eventual recommendations and undermines the value of having invited the inquiry in the first place;
• (b) the OBR’s core forecasting and fiscal-rule assessment function has, notwithstanding the November 2025 failure and recent headroom pressures, performed close to its intended 2011 design; reforming the institution itself risks a disproportionate response to what was, at root, a publishing security failure rather than a forecasting or governance one;
• (c) further change to the fiscal framework so soon after the 2024 reform of the fiscal rules and the introduction of the fiscal lock risks a degree of “fiscal framework churn” that itself undermines the predictability the framework exists to provide.

Options

Option A: Implement the Ciaran Martin recommendations and await the Treasury Select Committee

10. Under this option, the Government confirms the move of market-sensitive OBR publications to the GOV.UK platform, implements Ciaran Martin’s further technical recommendations in full, and takes no other structural action pending the Committee’s report.

11. For:

• (a) addresses the most acute and immediate failure without waiting for or pre-empting the Committee’s broader conclusions;
• (b) avoids the Government appearing to pre-judge or duplicate a process it itself welcomed, preserving the value of the Committee’s own cross-party assessment;
• (c) avoids adding a further round of change to a fiscal framework that has already absorbed reform of the fiscal rules and the introduction of the fiscal lock within the last two years.

12. Against:

• (a) the headroom-gaming problem at paragraph 4 predates, and is independent of, the Committee’s inquiry, and need not wait for it to be addressed;
• (b) the erosion of single-fiscal-event discipline has persisted across multiple Chancellors’ stated commitments to it without a change of mechanism, giving limited reason to expect continued reliance on convention to succeed now;
• (c) risks the Government appearing to treat a market-moving institutional failure as a narrowly technical IT matter, when the underlying design question — how much operational and publishing responsibility an operationally independent OBR should hold itself, rather than share with a better-resourced Treasury — may or may not be addressed in full by the Committee’s remit.

Option B: Place single-fiscal-event discipline on a statutory footing

13. Under this option, legislation would provide that a Spring Statement, or equivalent early-year fiscal update, may contain only OBR forecast publication and a factual account of the public finances, with any tax or spending measure above a low de minimis threshold triggering the same duty to seek an OBR assessment that currently applies to fiscally significant measures under the fiscal lock, formalising the discipline first announced administratively in 2016.

14. For:

• (a) gives legal effect to a policy you, and Chancellors before you, have repeatedly stated a wish to deliver, addressing the “convention alone has not worked” concern at paragraph 9(a) reversed into a case for this option;
• (b) reduces the frequency of high-stakes fiscal set-pieces, each carrying its own operational risk of the kind experienced in November 2025, simply by there being fewer of them;
• (c) consistent with the International Monetary Fund benchmark you have yourself invoked, and with the Institute for Government’s long-standing recommendation.

15. Against:

• (a) a statutory threshold for what counts as a qualifying “measure” is likely to generate boundary disputes similar to those the fiscal lock’s 1%-of-GDP threshold already generates for significant announcements, simply relocated to a lower and more frequently tested level;
• (b) reduces the Government’s flexibility to respond to fast-moving economic developments between the single annual event, without either relying on the emergency exemption already available under the fiscal lock or being seen to strain the spirit of its own statutory discipline;
• (c) does not itself address the headroom-gaming or publication-security problems at paragraphs 4 and 6, which arise regardless of how many fiscal events occur each year.

Option C: Reform the fiscal rules’ forecast horizon and headroom design

16. Under this option, the Charter for Budget Responsibility would be amended to require a minimum headroom buffer against the fiscal rules — for example, a floor expressed as a proportion of receipts rather than a cash figure eroded by inflation — and the OBR would be required to publish a standardised measure of how much of any Chancellor’s stated headroom depends on the forecast years furthest from the present, and therefore least reliable, making the dynamic identified at paragraph 4 visible even where it is not directly prohibited.

17. For:

• (a) addresses the headroom-gaming problem directly, at its source in the rules’ design, rather than through the fiscal calendar considered in Option B;
• (b) a published fragility measure increases transparency without removing the Chancellor’s ultimate discretion over fiscal policy, a lighter-touch intervention than a hard minimum-headroom requirement;
• (c) responds to a problem that has recurred across multiple Chancellors and governments, targeting a structural feature of the framework rather than any single administration’s choices.

18. Against:

• (a) a statutory minimum headroom requirement becomes, in effect, a new fiscal rule that could bind unhelpfully during a genuine fiscal shock, recreating in a different form the rigidity critics identify in the existing rules;
• (b) a published fragility measure may in practice add limited discipline beyond what the OBR’s existing, detailed published assumptions already allow an attentive observer to establish for themselves;
• (c) reform of the Charter for Budget Responsibility is itself territory the Treasury Select Committee’s inquiry may address, carrying the same pre-emption risk identified against Option A, in reverse.

Option D: A fuller remit and machinery review of the OBR

19. Under this option, a review, commissioned now or requested to follow the Treasury Select Committee’s report, would examine whether the OBR’s market-sensitive publishing function should be permanently and formally integrated with HM Treasury’s infrastructure rather than run separately; whether its methodology for scoring the supply-side effects of policy — including, for example, the growth effects claimed for the planning and consenting reforms considered in the companion submission on fast-track consenting — should be made more transparent or independently audited; and whether its remit should extend to a wider coordinating role across other official forecasters, such as the Bank of England and the Department for Work and Pensions.

20. For:

• (a) treats the November 2025 failure as a symptom of a genuine institutional design question, rather than a one-off IT fault, directly answering the concern raised against Option A at paragraph 12(c);
• (b) a transparent and independently audited supply-side methodology would directly inform the credibility of growth claims made for reforms considered elsewhere in the Government’s programme;
• (c) is the option best placed to absorb and act on the Treasury Select Committee’s eventual recommendations in full, rather than pre-empting them with the narrower reforms considered under Option B or C.

21. Against:

• (a) the broadest and most resource-intensive of the four options, likely to take the longest to design and implement, and requiring primary legislation to alter the OBR’s statutory remit under the 2011 Act;
• (b) integrating the OBR’s publishing function fully with the Treasury risks blurring the operational independence from the Treasury that was the OBR’s founding purpose in 2011, a trade-off that would need to be managed rather than assumed away;
• (c) a wider coordinating role across other forecasters raises separate governance questions, in particular the Bank of England’s own statutory independence, extending well beyond the scope of the Committee’s current inquiry and requiring separate consultation with the Bank and the Department for Work and Pensions.

Resource and Cost Implications

22. Option A carries minimal direct cost, limited to the technical work of migrating publication to GOV.UK and implementing Ciaran Martin’s further recommendations, already substantially under way. Option B requires primary legislation and Treasury guidance on the new de minimis threshold, with limited ongoing resource once implemented. Option C requires amendment to the Charter for Budget Responsibility, together with additional OBR analytical capacity to produce and maintain a standardised fragility measure. Option D is the most resource-intensive, requiring primary legislation, a lengthy review process, and, if pursued, a substantial one-off cost to integrate publishing infrastructure alongside a recurring cost for expanded supply-side and cross-forecaster analytical capacity.

Legal and Devolution Considerations

23. The OBR’s establishment, remit, and duty to produce forecasts are set out in the Budget Responsibility and National Audit Act 2011, as amended in 2024 to introduce the fiscal lock. The Charter for Budget Responsibility, which sets out the fiscal rules and the OBR’s detailed remit, is a Treasury document approved by resolution of the House of Commons and does not itself require primary legislation to amend, a materially lighter process than amending the 2011 Act. Option C could therefore be pursued without primary legislation; Options B and D, to the extent they alter the OBR’s statutory functions or impose new statutory duties on the Treasury, would require it.

24. Fiscal policy and the operation of the OBR are reserved matters. The Scottish Fiscal Commission and the devolved Welsh fiscal forecasting arrangements operate separately, forecasting devolved tax and spending decisions within the block grant framework set by the OBR’s UK-wide forecasts, and are not directly affected by any option considered here, though the Scottish Fiscal Commission has faced comparable questions about forecasting independence and remit that officials may wish to note as a further comparator if the Committee’s eventual report addresses them.

Requested direction

25. The Chancellor is invited to indicate whether reform should await the Treasury Select Committee’s report, with only the already-agreed security recommendations implemented in the meantime (Option A); whether single-fiscal-event discipline should be placed on a statutory footing now (Option B); whether the fiscal rules’ forecast-horizon and headroom design should be reformed to address the recurring gaming problem (Option C); or whether a fuller remit and machinery review of the OBR should be commissioned, extending beyond the Committee’s current inquiry (Option D); and, given that the Committee’s inquiry remains live, how any preferred option should be sequenced with, or presented as a response to, its eventual report.