Treasury perm sec warned ministers over Tory tax claim

James Bowler said ministers should not say a Conservative costing was produced by civil servants
Photo: ITV

By Tevye Markson

05 Jun 2024

Treasury permanent secretary James Bowler warned ministers against presenting the Conservative Party's costings of Labour’s tax plans as having been produced by the civil service ahead of last night’s election debate, it has emerged.

During the ITV head-to-head debate between prime minister Rishi Sunak and Labour leader Keir Starmer, Sunak said: "Independent Treasury officials have costed Labour's policies and they amount to a £2,000 tax rise for every working family".

In response, Starmer called Sunak's claim "absolute nonsense” and told the audience, "they put in pretend Labour policies to the Treasury and then they get a false readout".

A letter from Bowler, released this morning, has poured cold water on Sunak’s claim. Writing to Darren Jones, Labour’s shadow chief secretary to the Treasury, earlier this week, Bowler said: “As you will expect, civil servants were not involved in the production or presentation of the Conservative Party’s document Labour’s Tax Rises or in the calculation of the total figure used.”

Bowler was responding to a letter from Jones, which the perm sec said had highlighted that the £38bn figure used in the Conservative Party’s publication "includes costs beyond those provided by the civil service and published online by HM Treasury".

"I agree that any costings derived from other sources or produced by other organisations should not be presented as having been produced by the civil service,” Bowler said.

He added that he had “reminded ministers and advisers that this should be the case”.

Labour shadow ministers have accused accused Sunak of lying multiple times during the debate over the tax claim. The Conservative Party has said it used a combination of clear Labour policies, Labour's costings and official Treasury costings to make the estimation.

The PM's claims were based on a document, Labour’s Tax Rises, published by the Conservative Party earlier this month that said it had tallied up costings produced by civil servants, alongside spending announcements made by the Labour Party, and found £38.5bn of unfunded spending plans. The document says this means that Labour would need to either increase borrowing or raise tax by £2,094 per working household over the next four years.

Five of the 27 spending policies and revenue-raising plans assessed in the document were not costed by civil servants and instead have been estimated based on Labour announcements. 

Sunak’s claim that “independent” Treasury officials costed Labour policies is also problematic, as civil servants are not independent of the government. The Institute for Government’s Alex Thomas, a former senior civil servant, pointed this out after the debate, stating that opposition costings are not independent as “they work for the government of the day and used assumptions set out by Conservative special advisers”.

Following the debate and furore surrounding the tax claim, several senior former government officials called for an end to the practice of getting civil servants to cost opposition policies.

Ex-cabinet secretary Gus O’Donnell said on X: “Getting civil servants to cost opposition polices in run up to election needs to stop. In past both parties have done it. It is an unsavoury practice as assumptions provided by special advisers are biased to make party political scoring points. Next government should not do it.”

Peter Riddell, a former commissioner for public appointments, added: “Totally agree Gus – there need to be clearer dividing lines between the overtly party political in which officials should not be involved – especially during elections – and the civil service performing its constitutional duty of implementing the policies of the government.”

When costing the policies of opposition parties, the Treasury and the wider civil service follow established guidance set out in the Civil Service Guidance directory. The guidance states that "ministers, assisted if they wish by their special advisers, should be responsible for identifying the text of commitments together with any further interpretations or assumptions necessary to allow the commitments to be costed". Departments should then "provide factual material, drawing attention to any additional assumptions or qualifications which they have made".

Departments cannot undertake costings or analysis of opposition policies during the election period.  

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