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Tory leader Kemi Badenoch has accused Rachel Reeves for forcing Richard Hughes to resign as chairman of the Office for Budget Responsibility (OBR) because he revealed that she had potentially misled the public over the existence of a spending black hole
David MaddoxPolitical EditorWednesday 03 December 2025 13:14 GMTComments
CloseKemi Badenoch says Rachel Reeves belongs in 'La La Land' over Budget
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Rachel Reeves has been accused of forcing the chairman of the UK’s Budget watchdog to quit after he revealed that claims she made about the public finances were false.
Tory leader Kemi Badenoch led on the accusation about Richard Hughes, the former chairman of the Office for Budget Responsibility (OBR), during Prime Minister’s Questions just before Ms Reeves was called to answer an urgent question on his resignation.
It came as chief Treasury secretary James Murray confirmed that the department is holding a leak inquiry into the multiple briefings ahead of the Budget which has been blamed for causing chaos and paralysis in the economy.
Mr Hughes officially quit on Monday over a leak of details of the Budget 40 minutes before it was delivered last week, after an investigation found a long-standing systematic problem.
open image in galleryBadenoch continued to put pressure on Reeves during PMQs (House of Commons/UK Parliament)But prime minister Sir Keir Starmer was forced onto the defensive on the issue in the weekly exchanges at PMQs.
Ms Badenoch said: “We now know that the head of the OBR (Office for Budget Responsibility) was forced out for telling the truth that the chancellor did not need to raise taxes on working people. We also know that the chancellor was briefing the media, twisting the facts, all so she could break her promises and raise taxes.
"If she was a CEO, she would have been fired and she might even have been prosecuted for market abuse. That's why we've written to the Financial Conduct Authority (FCA), so will the prime minister ensure the chancellor fully co-operates with any investigation?"
To laughter from Labour MPs, Sir Keir replied: "She's completely losing the plot."
The prime minister later added: "May I pay tribute to Richard Hughes for his leadership of the OBR? He made very clear why he stepped down and I've made very clear my support of the OBR.
"But she says 'take responsibility' - under this chancellor, growth is up this year, defeating and beating the forecast, wages are up more since the general election than in 10 years of the Tories, we've had, I think, five interest rate cuts, NHS waiting lists are down, we've had record investment into this country.
open image in galleryChancellor of the Exchequer Rachel Reeves delivered her autumn Budget last week (Frank Augstein/PA) (PA Wire)"We're turning the page on their austerity."
However, Ms Reeves, who sat stony-faced next to the prime minister during PMQs, fled in a hurry before her shadow, Sir Mel Stride asked an urgent question on the resignation immediately after.
Instead, she left her deputy, James Murray, to respond to questions as pressure continues to mount on her position.
The row has been linked to an unprecedented press conference she gave ahead of the Budget, where she appeared to suggest income tax would need to be raised because of a Budget black hole.
But the OBR later revealed that at the time she knew there was not a Budget black hole because it had informed her that higher than expected tax receipts had left her with a £4bn surplus.
Sir Mel said: “The circumstances surrounding [Richard Hughes’s] resignation are still unclear” adding that it was “a useful distraction for the chancellor”.
He noted that Mr Hughes had taken “the unprecedented step” of publishing details of the pre-Budget discussions “because the OBR was concerned about partial leaks about their forecasts.”
He demanded to know whether “any pressure was put on to Mr Hughes to resign.”
Mr Murray said that the letter by the OBR on the full details of its pre-Budget briefing had been approved for publication by Ms Reeves.
He said: “The decision for Mr Hughes to resign was a matter for Mr Hughes for himself.”
The minister insisted that the government “is completely committed to the OBR’s independence.”
Later in the exchanges he was reminded that a previous chancellor Hugh Dalton resigned in 1947 for inadvertently leaking a single sentence of the Budget ahead of its announcement.
Mr Murray responded: “I did not realise that I would be scrutinised on my knowledge of history.”
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