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UK budget watchdog ordered to cancel new fiscal forecasts

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By Reuters
UK budget watchdog ordered to cancel new fiscal forecasts
Pound Sterling notes and change are seen inside a cash resgister in a coffee shop in Manchester, Britain, September 21, 2018. REUTERS/Phil Noble/Files   -   Copyright  PHIL NOBLE(Reuters)

LONDON (Reuters) – Britain’s independent budget watchdog dropped a plan to publish an updated assessment of the public finances on Thursday after the country’s top civil servant decided at the last minute that it would break election rules.

The Office for Budget Responsibility had been widely expected to revise up its forecasts for Britain’s borrowing needs after changes to the way the public accounts are calculated, putting the government on course to break a borrowing cap it had set itself.

Prime Minister Boris Johnson called a snap Dec. 12 election in a bid to break the Brexit deadlock.

His finance minister Sajid Javid said earlier on Thursday that only Johnson’s Conservative Party could be trusted with the public finances.

“We had planned to publish a technical restatement of our March public finance forecast this morning,” the OBR said in a statement issued an hour before the new forecasts had been due for release.

“This will no longer go ahead as the Cabinet Secretary has concluded that this would not be consistent with the Cabinet Office’s General Election Guidance.”

Javid, who is due to give a speech about his economic plans on Thursday, is reviewing the government’s budget rules and has said he wants to take advantage of low borrowing costs to spend more on infrastructure.

Cabinet Secretary Mark Sedwill earlier this week also ruled that a plan by Javid to use the civil service to assess the cost of the opposition Labour Party’s spending plans would break impartiality rules.

(Writing by William Schomberg. Editing by Andrew MacAskill)