Speeches by Baldwin.

“If I may, Chair, I have a couple more questions on this subject, even though we seem to have asked a lot already. There were 60 people interviewed in the inquiry that you did—”

“Ms Pulay, you mentioned the challenging backdrop. Could you elaborate on what makes the backdrop challenging?”

“So the challenging backdrop is higher volatility in the gilt market?”

“Were any of them in No. 10?”

“No, but it has an impact on the gilt market, doesn’t it? Presumably, you work closely with the Bank of England in feeding into it about what size of quantitative tightening you think the market can absorb on top of your own issuance.”

“You are obviously issuing a lot of gilts. What changes have you seen in who the end purchasers of those gilts are?”

“The reason I ask is that I wonder whether you could clarify something. The story went out on the 13th that there was not going to be an increase in income tax. The markets moved on the morning of 14 November, and then a—presumably—Government spokesperson clarified that it was because the fiscal picture was better. Whic…”

“You will also move on from the simplistic political rhetoric around permanently lower rates, which could be misunderstood, as the UK Statistics Authority has pointed out.”

“Who officially put that out? Who instigated the official statement?”

“You have had to make further changes to address this. What lessons can you learn about the whole communication around this episode and the communication of what you thought was going to be the appropriate level of relief that you announced in the Budget?”

“Do you agree that it was a political disaster, effectively, wasn’t it?”

“I think, Minister, you would have to accept that it is a political problem when you then have to come back and make the changes that you did in that statement a month after the Budget. I will move on to the point I think you made in that statement in the Commons: that you thought the transitional relief announced in th…”

“But it will still be an independent body doing the March forecast?”

“Will we see an assessment of the headroom?”

“Do you accept the rebuke from the UK Statistics Authority that you could have been clearer in the messaging, and that you could have said that it wasn’t just going to be permanently lower and that there were these other things happening?”

“So the Treasury itself will not do the forecasts?”

“What I am hearing is that you thought that the £4.3 billion was going to be satisfactory to address this political issue, which was obviously looming in your inbox in the run-up to the Budget. Do you accept that, in terms of the rhetoric—Mr Dean has referred to this—what people in the sector heard was that we were movi…”

“So we will not see an Office for Budget Responsibility forecast this time?”

“This is obviously a very technical area. I want to focus my questions on the political decision making. You were appointed on 1 September last year. How quickly was it flagged to you that there was this issue coming down the line—that, according to the Valuation Office Agency, there was a 32% revaluation in the pub sec…”

“The spring statement will be on 3 March. How has the process of working with the Office for Budget Responsibility differed in the run-up to this spring statement compared with previous fiscal events, given that there is no chair?”