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OBR's £20 Billion Shortfall Turns to £4.2 Billion Surplus

11/29/2025

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Summary

Story summary

On August 7, Richard Hughes, chair of the Office for Budget Responsibility (OBR), sent a note to Rachel Reeves, UK chancellor, summarizing a pre-Budget forecast.
The letter, now public, triggered a crisis for Reeves and Hughes as the OBR indicated a £20 billion shortfall.
By October 31, the OBR revised its forecast to show a £4.2 billion surplus for Reeves, enabling targets without tax rises.

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Story summary

On August 7, Richard Hughes, chair of the Office for Budget Responsibility (OBR), sent a note to Rachel Reeves, UK chancellor, summarizing a pre-Budget forecast.
The letter, now public, triggered a crisis for Reeves and Hughes as the OBR indicated a £20 billion shortfall.
By October 31, the OBR revised its forecast to show a £4.2 billion surplus for Reeves, enabling targets without tax rises.