THE TUC has called for an urgent review of the government’s budget watchdog, warning that its discredited assumptions risk being a straitjacket on growth.

Officials claimed that improved Office for Budget Responsibility (OBR) forecasts led to Chancellor Rachel Reeves’s U-turn on Friday on her manifesto-breaking plans to increase income tax in the forthcoming Budget.

But today TUC general secretary Paul Nowak warned that this unaccountable body has an “outsized say across government policy” ahead of its expected downgrade to Britain’s productivity forecasts.

“The OBR’s dangerous group-think encourages whack-a-mole fiscal policy — where the Chancellor deals with one problem and another quickly emerges and long-term challenges facing our economy remain unresolved,” he said.

“The timing on the OBR’s productivity view is baffling. That’s why it’s time we urgently review whether the OBR is fit for purpose.

“The watchdog has serious questions to answer and is in urgent need of modernisation to stop it from being a drag on growth.”