Pat McFadden says ministers have discovered new information about government’s spending liabilities since taking office
Stewart Wood, a Labour peer and former adviser to Gordon Brown and Ed Miliband, posted a useful thread on X yesterday explaining why, even with the Office for Budget Responsibility publishing a regular, independent assessment of government finances, ministers are still able to argue that some of what they learned about public spending after taking office came as a surprise.
This is a common view among Conservative MPs & commentators. And of course it is right in the sense that the generally dire state of public finances was known before hand. But it is a view based on a misunderstanding about what is knowable from inside & outside the Treasury. 1/3
From outside we know OBR tax revenue forecasts, Govt spending plans & a sense of the gap between them. But what you have no way of knowing is the changing trajectory of costs & spending profiles for each of the myriad of things that the Government has committed to delivering. 2/3
So from oustide we have a sense of the revenue gap (gap between revenue & stated costs of Govt commitments) but no sense of the funding gap (gap between what Govt said X, Y, Z would cost & what they actually turn out to cost). Or even whether some policies are just unfunded. 3/3
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