Office for Budget Responsibility
UK's Independent fiscal watchdog, created in 2010, forecasting public spending, borrowing and tax receipts.
The OBR publishes its next forecast with the Budget on 28 October 2026, after official figures put borrowing £8.1bn over its profile in the five months to August and MPs rejected calls to overhaul it.
Last refreshed: 7 October 2026 · Appears in 2 active topics
Has the UK Treasury already costed the AI unemployment shock at £9 billion?
Timeline for Office for Budget Responsibility
Mentioned in: Healey rules out three big tax rises
Is Britain Actually Broke?Hillier's MPs seek 10-year OBR forecast
Is Britain Actually Broke?Set the monthly path against which the ONS measured the overshoot
Is Britain Actually Broke?: ONS puts borrowing £8.1bn over OBR pathSet the profile the ONS scored borrowing and debt against
Is Britain Actually Broke?: Debt beat the forecast, borrowing missed itMentioned in: Adam Smith Institute puts top tax rate at 54%
Is Britain Actually Broke?Background
The Office for Budget Responsibility (OBR) is the United Kingdom's Independent fiscal watchdog. It was set up in 2010 and placed on a statutory footing by the Budget Responsibility and National Audit Act 2011. It operates independently of HM Treasury and produces the official economic and fiscal forecasts against which the government's fiscal rules are judged.
Its main publication is the Economic and fiscal outlook, issued twice a year and normally alongside a Budget or fiscal event. Each forecast then serves as the benchmark for the monthly public finance figures until it is replaced; the March 2026 forecast, for example, was not due for revision until 28 October. It also publishes an annual fiscal risks report and models scenarios beyond its central case.
The OBR does not make policy. Its influence comes from setting the arithmetic within which a Chancellor must work: whether headroom exists against the fiscal rules, and how large debt becomes under its assumptions. The single most important of those is long-run productivity growth, held at 1.4% in 2026. A change to that figure moves the debt PATH more than most policy decisions do.
Borrowing runs ahead of its profile
The OBR's March 2026 forecast is the yardstick for every monthly borrowing figure until it is replaced on 28 October, the date it confirmed on 31 July. The Office for National Statistics said on 22 September that borrowing reached £77.3bn in the five months to August, £8.1bn above the OBR's profile, with benefits, debt interest and index-linked gilts driving the gap. The Institute for Government said on 7 September that the forecast had likely deteriorated since March.
The forecaster's own position held. On 23 September the Commons Treasury Committee rejected calls to overhaul it as "shooting the messenger" and suggested a ten-year forecast beside the five-year one; OBR chair Jonathan Haskel welcomed the report. Its 1.4% long-run productivity assumption, unchanged in July, does more than any other figure to set the scale of its debt projections.
Its worst case prices AI job losses
In March 2026 the OBR modelled a worst-case artificial intelligence scenario: 500,000 additional unemployed, no offsetting growth uplift and £9bn of extra government borrowing, roughly the annual budget of the Home Office. The Bank of England's March agents' summary cited the figure, alongside evidence that firms were already meeting demand without extra hiring as AI tools cut task times by 5-20% in standard cases and by up to 70% for highly automatable work.
The OBR presents the scenario as a downside, not a central projection. Its weight lies in translation: it turns a Labour market risk into a fiscal one, because taxes on employment supply most of the Exchequer's receipts. A shock of that size would leave a smaller employed base paying for the same public services.
It costs the NATO path at £40bn
The OBR costs the PATH from defence spending of 2.6% of GDP in 2026 to 3.5% by 2035, the target agreed through NATO, at roughly £40bn a year of extra spending in 2025-26 prices. The Institute for Fiscal Studies nets off spending already announced and funded, and puts about £25bn a year of that PATH still unfunded.
The two figures describe one commitment two ways: the OBR's is the full bill, the IFS's the share with no money yet behind it. The state pension triple lock adds a second pressure. The OBR now costs it at £15.5bn a year by 2029-30, roughly triple the original £5.2bn projection, a figure relayed through IFS analysis. Both costs feed the fiscal picture the 28 October forecast must absorb.
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