Watch the moment Matt Goodwin became embroiled in a fiery row live on air over claims Rachel Reeves “misled” the public.
No10 has dismissed claims the Chancellor misled the public when she warned of difficult decisions needed to fill the black hole in the public finances.
Dire warnings had been thrown around ahead of the Budget that the Chancellor could face as much as a £20billion “black hole” in the public purse.
However, a letter from the Office for Budget Responsibility (OBR) revealed on Friday that it told the Chancellor as early as September 17 that prevailing economic winds meant the gap would be much smaller than she had been indicating.
Mr Craig condemned accusations that Ms Reeves misled the public
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The economic watchdog later informed her in October the spending gap had closed altogether, leading the Tories to demand she resign.
Debating on the matter with political commentator Kevin Craig, the two quickly locked horns over whether Ms Reeves misled the British public.
Mr Craig lambasted the news as a “total attempt to whip up a political attack on the Chancellor when she was totally transparent about the forecast she was using and the measures that she set out and costed”.
He took aim at the likes of the People’s Channel, The Telegraph and the Mail for such an “attack”, at which Miriam Cates pointed out that The Guardian had been running the same story.
The left-wing paper ran the headline “OBR challenges claims Reeves dropped income tax rise due to rosier forecasts” and highlighted that the Chancellor was aware of “revised predictions well before her Budget change of heart”.
Official forecaster’s chair says chancellor knew about revised predictions well before her budget change of heart
“It’s massively important because the listeners and viewers are out there living real lives and working jobs and coming home.
“They would believe all of this and think there’s some Watergate scandal and there isn’t.”
Matt accused Labour of propagating ‘lies’
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At this point, Matt felt he had to intervene, commenting: “Hang on a second. First, this is on the front page of every national newspaper.
“I don’t think you’d say the Institute for Fiscal Studies is a very anti-Labour institution.”
When Mr Craig attempted to interject, he responded: “Well, sorry, you’ve had your bit. Let me talk.
“The IFS are saying publicly they think Rachel Reeves has lied to the country.
“And the reason that it matters for the people viewing this show and for millions of people in this country, is because they’ve also now been clobbered with another £30billion of tax rises, largely to subsidise people who don’t want to work and people who are not even from this country.
“Rachel Reeves led them down some dodgy path, making up a narrative that wasn’t based in reality.”
Matt urged Mr Craig to “look at the timeline”, starting with when the OBR first gave the initial forecast to the Treasury on September 17.
The September report showed that higher tax revenues have wiped out the £21billion of productivity downgrade that Rachel Reeves said was the reason that she had to introduce tax rises.
In short, the Chancellor knew that there was no fiscal black hole when she first openly flirted with an income tax rise.
“Are you asking me a question at the end of this so I can respond to it?” Mr Craig said.
“Why have you just sent the tax burden in this country up to the highest level on record based on lies?” Matt fumed.