Prime Minister Sir Keir Starmer is set to face MPs at Prime Minister's Questions on Wednesday, a week after Chancellor Rachel Reeves delivered the Budget. The session follows a report from the Organisation for Economic Co-operation and Development (OECD) warning that tax hikes and reduced spending will act as a "headwind" to the UK economy over the next two years.
The OECD also cautioned that inflation in Britain will be the highest among G7 advanced economies this year, with growth expected to slow and "substantial" downside risks to the Government's fiscal plans. The warnings come as Conservative leader Kemi Badenoch has branded the Budget a "Budget for Benefits Street" due to tax increases and the decision to scrap the two-child benefit cap.
Chancellor Rachel Reeves continues to face accusations of misleading voters about the state of public finances before the Budget. However, the Office for Budget Responsibility (OBR) suggested on Tuesday that her pre-Budget messaging was "not inconsistent" with analysis shared with her. Professor David Miles, an OBR committee member, told MPs that Reeves had described the Budget as requiring "very difficult choices."
Miles denied the OBR was "at war" with the Treasury after the resignation of watchdog chair Richard Hughes, which followed the inadvertent online release of the OBR's assessment of the Chancellor's plans before her speech. Former Labour Prime Minister Gordon Brown defended Reeves' decision to lift the two-child benefit cap, writing in the Daily Mirror that critics were spreading a "Tory lie" that abolition does not help children out of poverty.
