by RAY FLEMING

NEW Chancellors of the Exchequer like to make bold gestures to show that a new broom has arrived. Gordon Brown did it by handing over responsibility for setting interest rates to the Bank of England. George Osborne's idea was the brand-new Office for Budget Responsibility (OBR) which was to keep an eye on the government's books and become a credible economic forecaster, independent of the government of the day. Sir Alan Budd, an old Treasury hand, was put in charge on an initial three-month contract but has just announced that he will not be seeking an extension. So the OBR will be losing its leader before it has even been formally established in British law.

The reason for Sir Alan's departure may not be unconnected to the projections of the effect on unemployment of the government's departmental cuts. When Harriet Harman was harassing David Cameron at PM's Questions on this subject he was able to floor her with new and more favourable figures from the OBR which had not been officially published. Not unnaturally this led to questions about just how independent the OBR is of the government. In principle it is a good idea but it has got off to a bad start, mainly because of the Lib-Con coalition's determination tp show how active it is, even if at the cost of loose ends being left untied.

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