OBR should leave Treasury to prove independence - Budd

The Office for Budget Responsibility (OBR) needs to have its own staff and offices to head off criticism it lacks independence, outgoing boss Sir Alan Budd says.

The Government's tax and spending watchdog has come under sustained attack in the past fortnight after it released figures on employment only hours before a debate in the House of Commons over leaked Treasury forecasts of public sector job cuts.

Budd, who resigned last week less than two months after the office was created, says the OBR must take action to demonstrate its independence, writes the Guardian.

"We are able to state, without reservation, that there was no ministerial involvement in the forecasts at any stage," he says.

"However the fact that we were operating in the Treasury and relying on official resources has raised doubts about our independence in some quarters."

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Bank says QE cut interest rates by 1%

Research published by the Bank of England suggests the Bank's policy of quantitative easing - the direct injection of money into the economy - reduced interest rates by about 1 percentage point.

The research paper found that "gilt yields are about 100 basis points lower than they would otherwise have been".

The Bank started what became a £200bn programme of purchases of assets, mostly gilts, in March last year as it found it could not practically cut the Bank rate below the record low of 0.5%.

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