Sir Iain Duncan Smith has accused the Government of deceiving Parliament and Cabinet members regarding the state of public finances, following Chancellor Rachel Reeves’s tax-hiking Budget.
Speaking to GB News, the former Conservative leader said ministers were misled about a supposed £20billion fiscal shortfall.
Following the Budget’s leak last week, Richard Hughes resigned as chairman of the Office for Budget Responsibility, telling the Chancellor he takes “full responsibility”.
Just two hours before announcing his departure, an investigation into the leak found the OBR had not shared the information “intentionally”.
The former Work and Pensions Secretary claimed the OBR repeatedly informed the Government no such deficit existed.
He said: “I think that the house was misled by the whole run into the Budget. We now also know that cabinet ministers appear to have been misled about this so-called black hole of £20billion.
“We know that the OBR told them on a number of occasions that there was no such thing as a black hole of £20billion. They said you had a surplus, which was small, that it was there, moved up to about £4.5billion.”
He added: “But she kept on going on about this black hole, and it was briefed into all the papers they all reported, that’s why all the journalists are saying it’s true; they were briefed.”
Sir Iain Duncan Smith has accused Rachel Reeves of ‘misleading’ Cabinet members following the OBR Chair’s resignation
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GB NEWS
Mr Duncan Smith asserted Labour sought the departure of the OBR’s chief executive after he released guidance that challenged their financial narrative.
He stated: “The head of the OBR was so fed up with having the OBR’s reports simply denied by the Government, that he came out and published the advice, and that’s why they want him to go, and why he’s gone, in reality.
“Because he made it clear, the OBR forecasts were clear that she did not have a black hole necessitating some massive tax rise. Her decisions were hers alone to raise taxes, nothing to do with an existing black hole from any other Government or anything else.”
Highlighting the “deceit” by Ms Reeves and Labour, Mr Duncan Smith told the People’s Channel: “And I think that is the deceit that has taken place throughout all of this by her and her team.
Chair of the OBR, Office For Budget Responsibility, Richard Hughes, (left) has resigned
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GETTY“And now it appears, even the Cabinet was deceived about the black hole. So many of them running departments that needed some investment, were told, basically, ‘back off, because we got a black hole, we have to fill it.’ Not true.”
He highlighted findings from the Centre for Social Justice indicating welfare expenditure could rise by more than £91billion before this Parliament concludes, criticising the Government’s decision to avoid implementing welfare reforms.
He explained: “What the [CSJ] has pointed out is that overall, at the end of this Parliament, the way things are going, the benefit bill will be over £91billion higher.
“The Government chose to do no welfare reform on it. We put forward a report that said you could get the bill down by at least 30 to £40billion; all that was up.
Iain Duncan Smith told GB News £91billion extra pounds on welfare is ‘staggering’
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GB NEWS
“And in this year, the report, they show that the result of not controlling welfare has meant that therefore, working families, working hard, who have made decisions about the numbers of children they have, will be earning less than an equivalent family [with] three children who are on benefits, in fact, to such a degree that they’d have to be earning £71,000 a year to take home about £28,000.”
He expressed concern about the financial implications, declaring: “£91billion extra pounds on welfare by the end of this Parliament. That is staggering.”
Mr Duncan Smith argued the administration lacks the resolve to implement necessary reforms and reductions in welfare expenditure.
He said: “The reality that we’ve got here is that the Government has skewed everything against working age people, and what is happening now there is a disincentive built into the system to go to work. That is a terribly damaging position to be in.”