Fiscal rules change by fiat: no due process, no buffer norms

The UK's fiscal rules have been rewritten roughly nine times since 2010, each time by government announcement without consultation. The Lords Economic Affairs Committee's April 2026 report 'Fortifying the fiscal framework' found this churn, plus wafer-thin 'headroom' treated as a target, has made the framework 'frail' and the OBR a lightning rod. The IFS has proposed replacing the pass-fail rule with a graded traffic-light assessment; the Lords recommend codified larger buffers and rule changes only after formal consultation outside election periods. The 2025 move to a single annual OBR assessment addressed symptom, not cause. Nothing currently obliges any government to follow due process when moving the goalposts.

Credibility is the cheapest form of debt reduction: elevated term premia partly price the risk that rules will be redefined when binding. Forecast noise around a £10bn headroom margin currently drives tax speculation cycles that damage investment and policymaking quality.

Amend the Charter for Budget Responsibility to require public consultation and independent review before rule changes, codify a minimum buffer norm, and adopt a graded (traffic-light) compliance assessment: a drafted, ready-made legislative package a policy unit could produce this year.

// State-led: Instrument: Charter for Budget Responsibility amendment; a policy unit can draft the package, only government can enact due process.

Markets partly price debt on the risk rules move when they bind; a ready-to-draft package could mandate consultation and a codified buffer, but no dated trigger forces it.