Union calls for robust review of OBR over fears it holds back economic growth
Summary
The Trades Union Congress (TUC) is asking Chancellor John Healey to fully review the Office for Budget Responsibility (OBR), arguing that its current approach limits public investment and economic growth. The TUC also wants the government to increase funding through bodies like the National Wealth Fund to support long-term projects and stimulate growth.Key Facts
- The TUC wants a complete review of the OBR’s methods, saying it underestimates the benefits of public investment.
- The OBR assumes public investment reduces private investment, a view some economists disagree with.
- The TUC criticizes the OBR for keeping outdated economic models linked to austerity policies.
- Jonathan Haskel, the new OBR chair, expects higher interest rates and slower economic growth in the medium term.
- The TUC calls for the National Wealth Fund’s rules to be changed to allow longer-term investments (up to 15 years).
- These investment changes aim to boost infrastructure and British businesses, encouraging private investors to join.
- The government’s fiscal rules now allow borrowing for investment without counting against budget targets.
- Some experts worry about the effects of more government borrowing on bond markets.
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