Chancellor faces a fight to duck blame for tax hikes

Rachel Reeves will have to engage in a major pre-Budget spin operation at the Labour conference in Liverpool over the next few days. The chancellor wants to persuade the nation that, when she raises taxes in November, it will not be her fault.

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As we report today, one of the reasons she will have to make the unpopular move is that the Office for Budget Responsibility is going to downgrade its forecast for productivity improvement over the next few years. This means that the OBR thinks that growth will be lower, and so will tax revenues, requiring new tax rises or spending cuts to keep borrowing within the limits that Ms Reeves has set.

The chancellor is entitled to point out that the OBR's productivity downgrade is a correction to optimistic forecasts made under the previous government, and has nothing to do with any of her policies. As a senior source told The Independent, "the OBR will make it clear that the revision has nothing to do with any of the measures brought in by this government".

There is a bitter irony here in that many Conservatives, including many supporters of Liz Truss, the brief prime minister, complained about the OBR making it hard for the government to cut taxes. In fact, the OBR's optimistic forecasts gave the Tory government more scope for cutting taxes than they should have done.