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11 March 2014

Danny Alexander says OBR could audit Labour’s manifesto

The Chief Secretary to the Treasury contradicts Osborne and says the idea is "well worth further consideration".

By George Eaton

From the moment Ed Balls proposed allowing the OBR to audit Labour’s tax and spending commitments (and those of other parties), the Tories sought to strangle the idea at birth. Sajid Javid, the Financial Secretary to the Treasury, declared: “Ed Balls knows this is not allowed under the Budget Responsibility Act and the OBR’s charter, so this is just a stunt to try and distract attention from the fact that Labour have been found out for making unfunded commitments that would just mean more borrowing and more debt.

“Nothing has changed – it’s the same old Labour. Ed Miliband and Ed Balls still want more spending, more borrowing, and more debt – exactly how they got us into this mess in the first place. And it’s hardworking people who would pay the price through higher taxes and higher mortgage rate.”

The Tories’ decision to torpedo the plan, which would require legislation, was entirely politically motivated. David Cameron and George Osborne intend to run an election campaign based on Labour’s “black hole” and are determined to prevent anything that would allow the opposition to enhance its fiscal credibility. Back in October 2010, Osborne said that the possibility of OBR auditing was “a legitimate matter for the House to debate and decide”. Yet a debate is precisely what he has refused to allow by rejecting the idea out of hand. 

But with the Chancellor away in Brussels, Balls seized the opportunity to question Danny Alexander on the subject at Treasury Questions today. The Chief Secretary to the Treasury may have been accused by his fellow Lib Dems of “going native” (“rather than meeting Danny we just ask for the Treasury ‘lines’ – it’s quicker,” one Lib Dem adviser told me recently) but today he contradicted his master by declaring that it was “an idea well worth further consideration” since “the British people need to know that what every party says is what it means”. Balls, who has previously won the endorsement of Treasury select committee chair Andrew Tyrie, replied: “[T]here was some encouragement there, I would urge him, this once, on this one issue, to try and persuade the Chancellor to take a different view. Try and persuade the Chancellor this once to change his mind, to do the right thing, vote in the Finance Bill for this important change. It can be done, it should be done, let not the Liberal Democrats be a road block to this important reform.”

It will probably take more than Danny Alexander to persuade Osborne to think again, but Balls’s success in exposing this coalition divide leaves the Chancellor in a more awkward position. 

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