Richard Hughes has resigned as chair of the Office for Budget Responsibility after the watchdog leaked details of the Budget early last week.
Hughes announced his resignation yesterday afternoon after an investigation into the error described it as the “worst failure” in the OBR’s 15-year history.
News of Hughes’ decision came as chief secretary to the Treasury James Murray was updating MPs on the probe into the leak, conducted with former National Cyber Security Centre chief executive Ciaran Martin.
Murray told parliament that the investigation had revealed that the leak had not been “simply a matter of [someone] pressing the publication button on a locally managed website too early”. He said there were “systemic issues” at the OBR and that the problem exposed last week “was not a new one”, with sensitive information believed to have been accessed early on previous occasions.
Murray said there would now be a “forensic examination” of other fiscal events in which documents could have been accessed early.
In his resignation letter to chancellor Rachel Reeves and Treasury Committee chair Dame Meg Hillier, Hughes described the early publication of the watchdog's report on Wednesday as a “technical but serious error”.
He said he was “certain” that the OBR “can quickly regain and restore the confidence and esteem that it has earned through 15 years of rigorous, independent, economic analysis” by implementing the recommendations of the report.
The report said the independent financial watchdog should look at overhauling how it publishes sensitive material like budget forecasts online.
Hughes added: “But I also need to play my part in enabling the organisation that I have loved leading for the past five years to quickly move on from this regrettable incident. I have, therefore, decided it is in the best interest of the OBR for me to resign as its chair and take full responsibility to the shortcomings identified in the report.”
Reacting to Hughes’ resignation, Reeves expressed her gratitude to the economist for his work at the watchdog.
“I want to thank Richard Hughes for his public service and for leading the Office for Budget Responsibility over the past five years and for his many years of public service,” she said.
“This government is committed to protecting the independence of the OBR and the integrity of our fiscal framework and institutions.”
HM Treasury said it would launch “a competitive external recruitment process” to find Hughes’ successor in the coming weeks.
The early release of the OBR’s economic and fiscal outlook triggered fury in Westminster, with many Labour MPs saying in private that Hughes must resign over it. At a press conference on Monday morning, prime minister Keir Starmer said it was a “serious error” and a “massive discourtesy” to parliament.
The post-leak investigation concluded that the OBR analysis had not been leaked intentionally, but was the result of two errors in the watchdog's website setup.
‘Not a new problem’
Murray told MPs that the investigation underscored that “a significant and long-standing issue” had “allowed external users to gain early access to the OBR’s publication”.
The chief secretary said the investigation had “made it clear that the problem exposed last week was not a new one” and that the OBR’s EFO in March also appeared to have been accessed before Reeves delivered her Spring Statement to parliament.
The report said there had been one successful attempt to access the EFO document around five minutes after then chancellor began delivering her Spring Statement to parliament on 26 March. By convention, it should not have been published until the statement had been delivered in full.
Murray said the report noted that “common and fairly basic protections to prevent early access”, such as passwords and random-character URLs, were not used. He added that configuration errors that were not understood by the OBR’s online publishing function had prevented the safeguards in its online publishing software from being effective.
Murray said that the first IP address to successfully gain early access to the OBR report last week had made 32 earlier attempts on the day of the Budget, starting at 5am.
“That volume of requests implies that the person attempting to access the document had every confidence that persistence would lead to success at some point,” he said.
“Unfortunately, that leads us to consider whether the reason they tried so persistently to access the EFO is because they had been successful at a previous fiscal event. At this time, we do not have answers to all those questions, but the Treasury will make contact with previous chancellors, to make them aware of developments relating to previous fiscal events.”
Murray said the government would work with the NCSC on a “forensic examination” of other fiscal events, in line with one of the report’s recommendations.
OBR ‘not the messiah’ PACAC chair says
Simon Hoare, chair of parliament’s Public Administration and Constitutional Affairs Committee, said last week’s leak and the resulting report offered ministers an opportunity “reflect” on the OBR’s future.
Adapting a line from Monty Python’s Life of Brian, Hoare proposed that the potential for the OBR to be scrapped should at least be considered.
“I am not seeking to scapegoat the OBR, but it is not the messiah – sometimes, it can be a very naughty boy – and it does have to revise its predictions at all times,” Hoare said.
“Is it too traditional to suggest to this government that the Treasury should be the office of budget responsibility, and that there are good brains in the Bank [of England] that could be tapped into? Is now not a good opportunity to reflect on what advice the government need, whether the OBR is fit for purpose, and whether it should be disbanded?”
Tom Scotson is a reporter on Civil Service World’s sister title Politics Home, where a version of this story first appeared