The UK Treasury may have breached the law by withholding £9.5 billion in spending pressures ahead of Jeremy Hunt’s final Budget in March, according to Richard Hughes, head of the Office for Budget Responsibility (OBR).

Hughes suggested that vital financial data on departmental budgets, required by the OBR under the Budget Responsibility and National Audit Act 2011, was not shared, leading to a “materially different” outlook on public finances.

Hughes told MPs that this undisclosed information affected the OBR’s ability to provide an accurate forecast, describing it as a “systematic failure” within the Treasury. While Hughes does not suspect malicious intent, he noted that the lapse has impacted trust, shifting their relationship with the Treasury from “trust” to “trust but verify.”

This revelation follows Chancellor Rachel Reeves’ claim of inheriting a £22bn budget “black hole,” a figure questioned by the OBR but partly substantiated by the £9.5bn of hidden costs. Former Chancellor Jeremy Hunt, however, has criticised the timing of the report, suggesting it risks being used as a “political weapon.”

In addition to the controversy, Hughes warned that the Government’s shift towards electric vehicles, with fuel duty revenue set to drop as petrol and diesel cars phase out, could leave a significant gap in the public finances, comparable to recent tax hikes. Fuel duty, expected to bring in £27.2 billion this parliament, will steadily decrease as the UK approaches its 2035 ban on new petrol and diesel car sales.

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Treasury accused of hiding £9.5bn ‘black hole’ in budget, says OBR chief