Budget Responsibility and National Audit Bill [HL]

My Lords, we usefully teased out a number of issues on this Bill in Grand Committee, so I am pleased to be able to come back to the House with a number of amendments, of which this group is the first. Our amendments very much reflect a number of critical points that we discussed in Grand Committee. Perhaps I should start with Amendment 4, on which Amendments 1 and 2 are essentially consequential. We are talking here about the independence of the OBR. Amendment 4 will formalise the role of the non-executive directors in reporting on the extent to which the OBR’s duty has been performed, in accordance with Clauses 5(1) and 5(2) of the Bill. To ensure the OBR’s credibility, it is important that the OBR is able to operate with the complete discretion provided for at Clause 5(1) and in line with the principles of Clause 5(2). Amendment 4 provides a mechanism for the non-executive directors to report on anything that they believe has prevented the OBR from carrying out its duty with complete discretion and ““objectively, transparently and impartially””. Such a report will feature as part of the OBR’s annual report, which is to be laid before Parliament. For example, the non-execs might report on any interference with the preparation and publication of the OBR’s reports or any attempt to control the OBR through manipulating its budget. Amendment 12 will remove the provision that states that the charter may include guidance on Clauses 5(2) and 5(3). That will address the particular concern raised in Grand Committee that the charter could be used to redefine the commonly used terms ““objectively, transparently and impartially””. It is not the Government’s intention to subvert what these terms mean through the charter. The amendment will therefore remove the marker that strongly indicates that the charter will define what these terms mean. Amendment 13 will change the process for amending the guidance in the charter. Concerns were raised in Committee that such modifications could be done too easily, which would again undermine the independence of the OBR. Amendment 13 requires the Treasury to publish any revisions to the guidance at least 28 days before the modified charter is laid before Parliament for approval in another place. This period of 28 days, which is consistent with the period used in other secondary legislation, will provide further opportunity for scrutiny of and comment on the guidance before it is voted on. If appropriate, the Government could respond to, or make changes in the light of, this scrutiny before the formal version is laid for approval. Other safeguards remain in place. The charter is limited to considering the functions conferred on the OBR in the Bill and cannot add or distort them. The charter must also be approved by an affirmative resolution in another place before it comes into force. Amendment 11 will clarify the drafting of Clause 5(3) to make explicit that the OBR must have regard to government policies relevant to its analysis, including the Government’s economic policies. The amendment preserves the original effect of Clause 5(3), which is to prevent the OBR from examining non-government policies. Otherwise, the OBR could be drawn into political commentary, which might undermine its perceived impartiality and independence. The OBR will continue to be able to analyse non-policy scenarios such as economic or demographic scenarios. I beg to move.