MPs attack Brown's Budget arithmetic

LAST MONTH'S Budget did cut taxes, according to a report yesterday from an influential House of Commons committee, writes Diane Coyle.

But, in a judgement of Solomon on the subsequent tax row, it concluded the tax burden is nevertheless rising because of previously announced measures.

This should give the Bank of England leeway to cut interest rates, it said.

The Treasury Committee attacked the obscurity of the Budget documents. It said a leaflet on the Budget to be sent out to all households in Britain must be prepared with help from an independent body such as the National Audit Office or Institute of Fiscal Studies to "guarantee its impartiality".

Yesterday's report criticised Mr Brown for not making the figures clearer. The basic arithmetic of the Budget "should be set out clearly in a user- friendly format," the committee said. It added that changes in accounting conventions were acceptable but said: "The difference between the old and new systems should have been spelt out in ... the interests of transparency."

The MPs recommended that in future the Treasury should give full details of the impact of successive Budgets, and should also present the tax and spending figures on a consistent basis over time.

They criticised the fact that it was not possible to track changes made between the pre-Budget report in November and the March Budget.

The MPs called for an assessment of the distributional impact of the Budget to be provided by the Treasury on Budget Day, rather than leaving it to answers to subsequent Parliamentary questions.

Francis Maude, shadow Chancellor, pounced on the criticisms. "This is a damning report," he said.