Breakingviews - UK budget circus reveals technocracy’s limits

Jon Sindreu
Britain's Chancellor of the Exchequer Rachel Reeves speaks to nurses and members of the media during a visit to UCLH
Britain's Chancellor of the Exchequer Rachel Reeves speaks to nurses and members of the media during a visit to University College London Hospital in London, Britain, November 26, 2025. Adrian... Purchase Licensing Rights , opens new tab Read more
LONDON, Dec 3 (Reuters Breakingviews) - Technocracy has had a rough week on account of Britain’s Office for Budget Responsibility (OBR). First, the fiscal watchdog has found itself being dragged into public debate over finance minister Rachel Reeves' 26 billion pound tax hike. Then, on Monday, its chair Richard Hughes resigned following a data leak. These may be isolated mishaps, but they carry an important lesson for other independent bodies such as central banks and health agencies: when their advice appears to dictate political decisions, their legitimacy suffers. Better to pare it back.
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that the leak permanently damaged the OBR’s credibility are overblown, but they highlight its unusually prominent role among the world's fiscal councils. Created in 2010 with a political purpose -then finance minister George Osborne wanted a technical justification for spending cuts - the OBR later became the preferred way for officials to virtue signal fiscal rectitude following Liz Truss' disastrous 2022 mini-budget that bypassed it. Reeves has strengthened its authority by legislating that fiscal events must come alongside its economic forecasts. Yet her deference has served to further ensnare the watchdog in policy debate: ahead of her November 26 budget, she justified a major tax raid by citing the OBR's downgraded productivity projections, omitting that higher inflation in the same forecasts offset revenue shortfalls.

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Politicians blaming unelected bodies for tough choices is nothing new. Many countries have used International Monetary Fund loans as cover for austerity—the United Kingdom did so in 1976. During Covid-19, British ministers cited advice from the Scientific Advisory Group for Emergencies and Imperial College models to defend lockdowns and school closures, even as inquiries later showed
political factors shaped those decisions. Australia invoked epidemiological advice to justify
some of the world’s longest border closures.
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Central banks are harder to breach, yet they too face mission creep. The European Central Bank has had to stretch its mandate to save the euro, sparking legal and political battles
. Like others, it has also strayed into juggling goals beyond price stability, including climate risk and even income inequality.
Public anger at unaccountable institutions meets politicians eager to claim their decisions were inevitable, creating a feedback loop. Breaking it means stripping technocratic institutions back to core duties. Research finds
that expert bodies work best when they expand available information about policies and provide ranges of possible outcomes, rather than being wedded to any one particular agenda or analytical approach. Yet the OBR will inevitably find itself being pulled into politics given that the government's fiscal targets are explicitly built on its central long-term economic projections, which are subjective and prone to error. Ultimately, officials must choose between having a trusted independent body or someone to outsource decisions to. They can’t have both.
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    Editing by Neil Unmack; Production by Shrabani Chakraborty

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