The Tories are being crushed by their blind faith in incompetent technocrats

The Budget is likely to see the party pay a high price for not toppling failed bodies like the OBR

Wednesday was supposed to mark a turning point for Rishi Sunak. Instead it looks set to signal the end of the road. After well over a year of restraint, prioritising the battle against inflation over a gung-ho Trussite dash for growth, the Spring Budget was meant to be the breakthrough moment when Rishi Sunak finally revealed himself to be the tax-cutting populist who would salvage his party’s fortunes.

All the post-pandemic pain was going to pay off. After the perfect storm of rocketing bills, a record tax burden and flat GDP, the clouds would part, with sunlit uplands winking warmly on the horizon. Both the revolting Red Wall and attention-starved traditional Tory voters would be lavished with a generous platter of giveaways, financed by a moderate but cleverly-marketed array of benefits cuts.

Yet the Prime Minister’s tax-cutting red meat seems to have been reduced to gristle by the Office for Budget Responsibility grinder. And as far as a Tory message of hope going into the next election is concerned, there is none.

True, the Chancellor, Jeremy Hunt, is expected to announce some limited cuts to personal taxation. But the package looks set to be decidedly modest. No 11 has sought to dampen expectations that the Budget will be in any sense revolutionary. It is not even clear that Hunt will be able to match the 2p cut in National Insurance announced in last November’s Autumn Statement.

Worst, in a pyrrhic victory, he may be planning to finance whatever slim pickings he does offer through other tax increases that end up vindicating a Leftist view on taxation. Reports have suggested that the non-dom regime may be scaled back, for example. Tories who do not see this as a major problem – arguing that defending tax loopholes for the super-rich isn’t a vote-winner, and that they shouldn’t pass up a chance to confound Labour’s own fiscal plans – are missing the bigger picture.

The Right has already ceded significant ground to the Left’s destructive impulse to “make the rich pay”. But if the Tories go to war against non-doms, their commitment to that timeless pearl of conservative wisdom – that if you squeeze the rich too much, the most mobile will simply flee – will be permanently compromised. They will find their intellectual position severely weakened when they campaign against further wealth taxes in the future.

This is not how things were supposed to be. With the economic situation somewhat less dismal than had been expected, No10 seemed to have thought that Whitehall economists would forecast just enough fiscal headroom for more major changes to tax. But the opposite appears to have happened. The OBR is believed to have sent the Government figures that suggest that there is no wiggle room whatsoever, effectively killing its plans.

There is some irony in this turn of events. The same spurious OBR modelling that Sunak deployed as an authoritative weapon to bludgeon the “reckless” Reaganite plans of his one-time opponent, Liz Truss, looks set to crush his own tax-cutting hopes.

But this is a crisis for more than just the Government. On a democratic level, it is staggering that a technocratic body that has consistently produced flawed and inaccurate forecasts is being allowed to effectively decide the country’s future direction.

The OBR’S supporters point out that the Government writes its own fiscal rules, and that the body is technically accountable to politicians. But that is not how things have played out. MPS and commentators have elevated the OBR’S commandments to the status of gospel, and denounce anyone heretical enough to criticise its role as committing a crime against the economy and common sense. But when the alteration of some intermediate figure on a spreadsheet leaves the country tens of billions less to invest in a growth plan, it should give us pause for thought.

None of this was inevitable: the PM could have escaped the straitjacket of economic orthodoxy that has trapped him and his Government. But he has, in the crucial months leading up to Budget Day, proved destructively risk averse, unable to salvage his growth plans through the last-ditch pursuit of a heterodox Plan B. When the OBR admitted to bungling its projections and announced a shift in it modelling approach last year, a savvier PM would have moved to abolish it. Sunak didn’t.

Even having missed that chance, such an acutely intelligent PM should have been well-placed to challenge the mindset of a great many economic modellers today – including the idea that tax cuts have low economic growth benefits, a judgment contradicted by the historical evidence, particularly from the Thatcher-reaganite era in the 1980s.

Or he could have sought to focus attention on the behaviour of the Bank of England; it has, after all, not only been criticised for keeping interest rates too high for too long to cover its blushes over its earlier failures, but also engaging in a reckless quantitative tightening programme that has escaped any real democratic oversight. By aggressively dumping government bonds, seemingly to clear the decks for future rounds of money-printing, the Bank may end up lumping taxpayers with losses of over £100billion.

Instead, the PM has mindlessly followed the orthodoxy. True, a prudent dedication to balancing the books is a vital aspect of conservatism. But at some point, pro-growth Conservatives must point out that pursuing fiscal prudence is not enough. If this country is to have any hope of recovering its dynamism, the centreright must be willing to scrutinise the projections of powerful, unelected bodies compromised by economic groupthink and drifting to the Left on crucial questions like taxation.

They must start articulating the perils of a bizarre faith in the predictive powers of modelling, even when it is regularly proved to be wrong. And they must call out the unelected “disaster” bureaucrats in Threadneedle Street and the Treasury, who feed on the chaos that they create, consolidating power and operating with ever greater opacity and impunity even as their policy directives prove destructive to the country.

All this, of course, is but a hopeless cry for action in the distant future. For now we must watch as Sunak is ruthlessly sacrificed by the same economic priesthood that effectively anointed him as the country’s leader.

When the OBR admitted to bungling its projections last year, a savvier PM would have moved to abolish it. Sunak didn’t