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The government's official forecaster said the Treasury was not informed of “significant pressures” on public spending at the time of the March budget.
A study by the independent Office for Budget Responsibility (OBR) found that spending measures totaling £9.5bn were not shared with it, giving a false snapshot of the state of the finances public.
Chancellor Rachel Reeves raised taxes by £40bn in the Budget, which she partly blamed on the Tories making a 'series of promises' that they 'don't have the money to keep' .
Opposition leader Rishi Sunak said Labor's claims were “ridiculous”, adding that the tax rises were Reeves' choice.
Releasing its report, the OBR said that ahead of the March budget, the Treasury “did not share information with the watchdog about severe spending pressures on departments” totaling 9.5 billion of pounds sterling and the “unusual scale” of spending commitments.
“If this information had been made available”, it would have resulted in “a significantly different judgment” on public spending in the current financial year.
Its assumption of a £2.9 billion underspend published in its Economic and Fiscal Outlook would “very likely have been abandoned” and instead made a “significantly higher” forecast for spending this year.
However, the OBR said it could not say how much higher its forecast departmental spending would have been.
The chancellor's argument for a tax increase relies heavily on the OBR document, which is seen by the government as the rationale for the budget.
In his first budget speech, Reeves said the previous Conservative government had made spending promises it could not fund and that this had been “hidden from the British people… and hidden from this House”.
She said she was publishing a line-by-line analysis of the “black hole we have inherited.”
This shows “hundreds of unfunded pressures on public finances… this year and in the future too”.
In July, the Treasury published an analysis of the £22bn of additional spending pressures it was facing. This has been described by Labor as the “black hole” they inherited.
On Wednesday, the OBR outlined a similar increase in spending for the year – £23bn – which they split between the omitted £9.5bn and the cost of new policies announced since the March Budget.
On Wednesday, the Chancellor said: “We will never again allow a government to hide the true state of our public finances from our independent forecaster. »
Reeves went on to say she would implement all 10 recommendations made by the OBR in its review regarding the future relationship between the forecaster and the Treasury.
Responding to the chancellor's Budget speech, Rishi Sunak said Labor's claims about the state of the economy they inherited were “purely ridiculous”.
“These are his (Reeves) choices. So stop blaming everyone and take responsibility.” he said.
“Her decision to let borrowing rip apart makes her claims about the state of public finances completely absurd, because if they were truly in such a dire situation, as she said, what we should have seen today was a significant reduction in borrowing to fix them, not the madness it has just unleashed.”
Shadow chancellor Jeremy Hunt has already accused the OBR of failing to act in a “politically impartial manner” in publishing its findings on Budget Day.
In a letter to Hunt at the weekend, OBR chairman Richard Hughes said the review focused on “the adequacy of information and assurances provided to the OBR by the Treasury regarding departmental spending “.
The findings and recommendations concerned the “institutional relationship” between the OBR and the Treasury, Mr Hughes said.
He added that the review did not refer to the conduct or decisions of ministers.
