Treasury should have declared overspend by law - OBR

The Treasury should have disclosed a £9.5bn overspend in the public finances in the run-up to the previous government's Spring Budget "under the law", the UK's budget watchdog has said.

Richard Hughes, chair of the Office for Budget Responsibility (OBR), told a committee of MPs on Tuesday the Treasury should explain why information was "not provided to us".

His comments prompted the committee's chair and Labour MP Meg Hillier to suggest the Treasury "may have broken the law".

A Treasury spokesperson told the BBC it had acted "within the law" but said it had made changes to make sure the "unidentified pressures... never happen again".

The Conservative party has been ed for comment.

Last week, the OBR said the previous government "did not provide" them with all available information at former chancellor Jeremy Hunt's last Budget in March.

The £9.5bn overspend forms the basis of Chancellor Rachel Reeves’ claim that the Conservatives left Labour with a significant "hole" in the public finances.

Asked by the committee on Tuesday how the shortfall could have happened, the OBR's Mr Hughes said "the system very clearly broke down", but insisted "that kind of failure will not happen again" because of processes put in place since.

The OBR works closely with the Treasury. Its role is to assess the government's tax and spending plans and produce reports on whether the chancellors' plans are sound.

Its judgements and forecasts are closely watched by financial markets to determine if the UK's economic plans are credible.

Pushed on whether the Treasury broke the law over not disclosing an overspend, Mr Hughes said there may "have been a misunderstanding of how the law ought to be interpreted".

"There is no doubt in our minds that had that information been provided we would have had a materially different judgement," he added.

He said it "was a question for the Treasury to ask: why was information available within the Treasury and not provided to us":[]}