Starmer to chair Cabinet amid Budget fallout

Sir Keir Starmer will convene his top ministers on Tuesday amid the fallout from last week’s tax-raising Budget.

The weekly Cabinet meeting comes after the resignation of Budget watchdog chief Richard Hughes and an ongoing row over whether the Chancellor “misled” the country over the state of the public finances.

Mr Hughes quit as chairman of the Office for Budget Responsibility (OBR) on Monday following an investigation into the accidental publication of economic forecasts almost an hour before Rachel Reeves delivered her Budget.

The investigation found the incident was “the worst failure” in the organisation’s history, and Mr Hughes said he was leaving to allow the OBR to “quickly move on”.

In a letter replying to his resignation, Ms Reeves said he had led the OBR “with great commitment and integrity” and praised his “achievements” in the role.

Meanwhile, both Sir Keir and Ms Reeves have denied claims the Chancellor misled voters by talking up the impact of a downgrade in the OBR’s productivity forecasts.

The Chancellor in part blamed the £26 billion of tax rises in the Budget on the downgrade, which delivered a £16 billion hit to tax revenues.

Although an increase in tax receipts due to inflation and higher wages cancelled some of this out, the Chancellor said a forecast showing a £4.2 billion surplus against her borrowing rules did not include policies such as the abolition of the two-child benefit cap.

And she also rejected a report in The Times from an unnamed minister who claimed the Cabinet was “at no point” told about the “reality” of the OBR forecasts.

Speaking to BBC Wales, she said the Cabinet had been briefed on the Budget on the morning it was delivered, but “you would never expect the Prime Minister and Chancellor to go through all the detailed numbers”.

Tuesday will also see the conclusion of the Budget debate in the Commons, where the Conservatives continue to call for Ms Reeves to resign over her handling of the economy.