Office of Budget Responsiblity
Asked if there was any reaction to the comments made by Sir Alan Budd this morning where he had claimed the Prime Minister had mistakenly taken credit for slightly lower unemployment projections, when Sir Alan Budd had argued that it was a matter of methodology, the PMS replied that he had not seen Sir Alan Budd’s comments but presumably the question was referring to the decision to have a pay freeze in the public sector.
Put that Sir Alan Budd had argued that the reason for lower unemployment projections was not down to a public sector pay freeze but down to a change in methodology, the PMS said that it was for Sir Alan Budd to describe how his forecasts worked.
The PMS added that it seemed straightforward that if you paid people less and had a pay freeze, then for a given amount of money you could employ more people. The PMS said that the pay freeze enabled the public sector to potentially shed fewer jobs in the short run. These decisions on precise numbers of people employed in the public sector were decisions that would be taken in the context of the spending review.
Asked if there was a long-term plan for where the OBR would be based, the PMS advised people to speak to the Treasury. They had received advice from Sir Alan Budd yesterday and no doubt there would be further discussion about this in Select Committee hearings.
Put that President Karzai had issued an apology this morning for an incident in which three British troops were killed and had the Prime Minister reacted at this stage, the PMS replied that the Government was aware of an incident this morning involving ISAF troops. An investigation was underway and when it was appropriate we would release more details.
Asked if the Prime Minister would be kept fully updated, the PMS said he certainly would be. On when the Prime Minister was told of the incident, the PMS said that the Prime Minister was aware of it this morning.
Asked whether it was right for head teachers to be earning more than the Prime Minister, the PMS said that the department had responded to this. There was already a process underway, whereby the Secretary of State was consulting with the School Teachers Review Body on a number of pay issues, including a proposal to cap head teachers pay.
Asked if there was a view that pay should be kept under consideration, the PMS replied that there was a general view that the country was living beyond its means and we needed to do something about that. Part of the answer was to look very hard at what people were paid in the public sector.
When asked if there would be a cap on head teachers pay, the PMS said that there was a discussion happening at the moment between the Secretary of State and the School Teachers Review Body to look at pay issues generally. There was a proposal being discussed on capping head teachers pay.
Asked how likely an international agreement might be on a banking activities tax, the PMS said that discussions were already underway at the G20 and we were keen for those discussions to progress.
Asked if a decision had been made on whether the Prime Minister or Deputy Prime Minister would address the TUC Congress in September, the PMS replied that he did not know whether we had received an invitation from the TUC and if the Prime Minister was to accept that invitation we certainly wouldn’t be confirming it this far in advance.