Was there anything sensible in the OBR forecast? They were probably right to push their growth forecast down to nearer the consensus at 1.1% for this year, and to increase their unemployment forecast to 5.3%. Most were assuming this from private sector forecasts anyway.
They forecast that inflation will be at the target level of 2% in 2027, 2028, 2029 and 2030. That would be highly unusual. One of its foundations is their forecast that oil prices over those years will stay within a narrow range of around $62-68. That is also unlikely.
They assume that housebuilding will boom from the current 220,000 a year to hit 300,000 a year by 2029-30. So by the last year of this Parliament housebuilding will at last have reached the annual run rate the government promised, but will of course have fallen well short of the 1.5m target over the 5 years. There is no obvious reason to forecast such a big rise.
They think base rate will start to rise again from next year. They also expect the average government borrowing rate to hit a crippling 5.2% in 2029/30, up from 4.4% this year. This is not a background for more home purchase. It will confirm it has always been dearer for Reeves to borrow than the previous government.
They do make some plausible forecasts. They say the tax burden which was 38.8% of GDP in the last Conservative year will hit a terrifying 42.5% in 2029/30. That’s a 12% real increase in tax bills.
They expect gas production in the UK to halve (2030/31 on 2024/5) as a result of the manic close down our industry policy. They expect welfare spending to surge by £75 bn or 24%.
They estimate Bank of England losses to be paid for by taxpayers at £89 bn between 2025/6 and 2029/30! Still they do nothing to reduce them.
March 5, 2026
Indeed surely correct and all hugely depressing. This on top of Starmer, Lammy’s and it seem mainly Miliband’s destruction of the USA special relationship. I assume he is a bit upset by Trump pointing out how insane his 4 times the price Net Zero energy policy is!
A Heath excellent to day. Kemi says Starmer defence forces “are catching arrows rather than dealing with the archers” but we did not even catch the arrows did we?
Three more years of this lunacy probably under Rayner, Streeting, Miliband or Mamood in order of the betting odds!
March 5, 2026
Reported in the Telegraph today:-
“Ed Miliband led Cabinet opposition to US military action in Iran and the use of Britain’s bases.
In a meeting on Friday ahead of the strikes, Mr Miliband, Rachel Reeves and Yvette Cooper are understood to have strongly opposed British support for pre-emptive military action, which they believed would be illegal.“
So Starmer went along with this destroyed the USA/UK relationship and put their forces at extra risk only to change his mind a few hours later. The man is pathetic and hugely dangerous to the UK.
March 5, 2026
Allister Heath’s previous article yesterday? was very good too.
“Vast forces are mobilising to stop Britain’s only real chance of survival
The plot to topple the next Right-wing government has already begun”
March 5, 2026
Yet again a war in the middle east has exposed us to unwelcome volatility in the price of fossil fuels. The IRGC has now closed the Straits of Hormuz and has struck loaded oil tankers with drones. A tanker is reported to be on fire off Kuwait this morning.
Of course, as is customary here, the forecourts have immediately ramped up the price of unleaded by 8p a litre
UK natural gas futures jumped more than 40% on Monday. This unwelcome increase in the price of gas is going to have a dramatic effect on the spot UK electricity price, unless you have a fix from your supplier
Once more, the wisdom of replacing CCGT generation of electricity by renewable resources is apparent.
March 5, 2026
Far more sensible to exploit our oil, gas, shale and coal reserves … in the North Sea and onland.
March 5, 2026
The wise move would be to produce our own oil and gas from the North Sea and onshore via fracking.
March 5, 2026
Yes, another bump in the road but Net-Zero is still complete nonsense SG. Meanwhile, in the real world I have just ordered a new (ICE) car – whilst I still can and the “Pound in my Pocket” is still worth something. Petrol will go up a bit but then the lights will start going out soon too – when the gas fired backup to your windmills is shut down.
March 5, 2026
Volatility of prices with a chance of a reduction at some point rather than the guaranteed over payments to renewables in order to get buy in?
March 5, 2026
The bigger the government the smaller the citizen. Is that the policy?
March 5, 2026
Well Mr Gold yet again Milibands mad energy policy and ban in drilling, fracking gives us energy cost of 4 times those of the USA.
Circa 90% of our total energy (including transport and heating) comes from oil, coal, wood, natural gas… only about 30% of just “electricity” comes from wind (about 6% of our total energy). Solar is about 6% of electricity or 1.2% of our total energy. Not only this but as these are intermittent the fosil fuel sources work significantly less efficiently as forced to provide back up. Also the intermittents need far more expensive cabling (used at about 20% of capacity most of the time so 80% of the capital largely wasted) and they lose more in transmission.
Solar particularly bad in the UK as mainly delivered in the warmer months during the day when little demand for electricity virtually none in winter or nights. The 7.2% of our energy that comes from Solar and Wind (actually less after you allow for backup and connection costs & energy thus wasted) is largely irrelevant.
We could have “on demand” coal produced electricity at current coal prices for about 3-4p per KWH. We could frack or drill natural gas in the UK and have electricity and heating from that for not much more.
But dream on if you wish too. Note too that moving gas around the world is expensive and energy wasteful so locally drilled or fracked gas is far better and cheaper too.
March 5, 2026
Government that governs least governs best.
There is a reason why cliches become cliches.
March 5, 2026
Project “Destroy the UK’s viability as an independent, Sovereign, nation” is coming along very nicely for the International Marxists.
I guess the only possible positive is that the OBR’s predictions are NEVER correct. Unfortunately, on this occasion I think they’re probably far too optimistic.
March 5, 2026
It is worth remembering the OBR is simply an expensive Mystic Meg organisation. It employs thousands of institutionalised analysts providing the chancellor with best guesses of future fiscal outcomes based on past decisions/events and current policies being progressed.
They are not very good at their predictions for various reasons one of which is ‘events dear boy events’,
When Reeves stood up on Tuesday to give her statement the details (what few there were) was alredy overtaken by events over the previous weekend. She shoils have simply advised the Parliament the situation is so impacted by those events her forecast was now needing to be reviewed and a new statement would be made two weeks hence.
The fact she chose to ignore the Middle East conflict with Iran demonstrated even she knew the statement was worth nothing in the first place.
March 5, 2026
OBR forecasting is akin to climate alarmist computer modelling. The outputs depend on the value judgements of the forecasters and modellers, and offer a convenient shield for declinist Conservative and Labour governments to hide behind