Labour and the politics of budget responsibility

Labour’s Shadow Chancellor, Ed Balls, has requested that the Office for Budget Responsibility (OBR) assesses Labour’s plans for government. His intention is to show that the spending commitments Labour makes in the run-up to the general election are matched by cuts elsewhere, or extra revenue, having promised to maintain the coalition government’s deficit reduction plan for its prospective first year in office. The OBR is clearly well-placed to make this judgement.

There is the added bonus of ensuring that the OBR serves prospective governments as well as the incumbent one, given that the main criticism made of the OBR so far regards the apparent limitations of its independence from government.

The problem for Labour, however, is that, in seeking a pre-election seal of approval from the OBR, the party may be harming the prospect of building broad support for progressive policies if and when it forms a government.  Why?  Because of what the OBR represents within the machinery of the state, and what its existence means for the ideological underpinning of macroeconomic management in Britain today.

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Image: Harry Potts