The £35bn estimate that Kemi Badenoch, the Conservative leader, cited in her pre-Budget speech comes from the IFS. City AM's attribution of the figure to the IFS was correct. Yahoo News's attribution to the IMF was not.
According to Brit Brief, the IFS said in its analysis of 12 October that John Healey faces a £35bn Budget dilemma, with high inflation the main challenge. The IFS says inflation will erode departmental budgets and that the Chancellor must set spending totals he is willing to live within.
In "a plausible scenario", the IFS puts headroom at around £20bn in 2029-30, against £24bn forecast in March. It says uncertainty is "very high" and depends on how the OBR sees inflation affecting wages.
The IFS says higher interest rates on government debt push up borrowing by about £10bn in 2029-30, offset by inflation lifting tax revenues. Holding March's real-terms spending plans could require a £12bn top-up by the end of the decade, plus £3bn to hold capital spending plans.
Brit Brief reports Helen Miller, the IFS director, as saying a "steady-as-she-goes" Budget is "not an option available to the Chancellor".