In a move that will set the baseline for Treasury’s calculations before the budget in March, the Office for Budget Responsibility (OBR) is understood to have provided a preliminary outlook that shows a weaker rebound this year from a period of high inflation and falling living standards.
According to a report in the Times, the OBR has told the chancellor he will have £9bn less income after a fall in tax receipts compared with a forecast made in November.
OBR staff provide Jeremy Hunt with two independent assessments of the economy each year and how this will affect the government’s finances based on the Treasury’s spending plans. In a longstanding arrangement, the OBR gives an initial view to Treasury officials for them to begin the process of drafting budget proposals.
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