In his latest column, PopCon Director, Mark Littlewood, looks at the Spring Statement and announces that he is a launching his own economic forecasting agency in order to compete with the OBR. 

The Spring statement – quite properly described as an “emergency budget” – was painful to watch. Rachel Reeves effectively has now given up on anything approaching an economic strategy and is instead simply seeking to remain within the OBR’s estimates relating to her “non-negotiable” fiscal rules.

The equivalent is a business having as its only core aim to never receive a letter telling them that the bailiffs are intending to pay a visit. You then juggle exactly how and when you pay all the red-inked reminder bills that are piling up on your desk, simply to avoid (or at least delay) that grim eventuality.

Now, to be sure, if you’re running any form of business, making sure the bailiffs don’t turn up at your door is a worthy, indeed necessary, goal. But if it’s your only goal, then you’re not running much of a business.

This is where Rachel Reeves finds herself as the UK’s Chancellor. She exudes all of the self-confidence and calm strategic thinking of a penniless individual on their knees, pleading with a loan shark.

However, Reeves is not just in hock to our creditors, she is at the mercy of the Mystic Meg-style forecasting of the Office for Budget Responsibility. She has decided to contract out whatever ability she has to judge fiscal prudence to one of the poorest performing economic forecasters in the land.

This places Britain’s economic policy in a ludicrous position. The OBR only need to change their growth forecast by a decimal point or so either way and suddenly the Chancellor either has billions of pounds more to spend or, alternatively, colossal savings which she suddenly needs to find. This means substantial fiscal decisions are being based on the absurd belief that any forecaster can work out the UK’s growth rate in 2029 to within 0.1% of GDP.

The OBR’s current growth forecasts are for 1% this year, 1.9% next year, then 1.8% in 2027, 1.7% in 2028 and 1.8% in 2029.

I have decided to set up my own economic forecasting agency in order to compete with the OBR. It has produced two clear forecasting models and we will be able to compare my predictions with the OBR’s over the coming years.

My first model is called the “GHE system”. This assumes that we take insufficient account of negative events in both the short and medium term which are likely to hinder economic growth.

For those wondering, GHE stands for “glass half empty”. Under this model, we take the OBR’s projections and reduce them by 0.4% of GDP for the current year and 0.3% for subsequent years. This renders a growth prediction of 0.6% for this year, followed by 1.6%, 1.5%, 1.4% and then 1.5%.

The second model is known as the “NHADC projection”. Under this model, we assume that Britain’s GDP growth will always be somewhere between 0.5% and 2.5% and simply generate a completely random number between these two extremes. The NHADC model has projected 0.7% growth this year, then 2.0% in 2026, followed by 1.5%, 1.4%, and finally 0.8% in 2029. NHADC, of course, stands for “nobody has a damned clue”.

I have managed to create both of these economic forecasting models in under thirty minutes at a cost to the taxpayer of zero. You are all very welcome.

In contrast, the OBR has over 50 staff and a budget of about £5.5m per annum. They shouldn’t just be more accurate than my two projections – they should be expected to be enormously and consistently more accurate.

Let’s see who wins the forecasting game between now and the end of 2029, the OBR, the GHE or the NHADC.

Keep the flag of freedom flying.

Click here to read the press release sent on 1st April announcing the creation of Popular Forecasts. Mark explained everything to Emily Carver and Tom Harwood on GB News. Click below to watch it.