Fact check: Is the 22 billion budget black hole real

1. Summary of the results

The Treasury audit confirmed a projected £21.9 billion overspend in departmental spending for 2024/25 ^[1], but the characterization of this as a "black hole" is disputed. The figure consists of £35.3 billion in gross additional pressures, with £13.4 billion offset by reserves and allowances ^[1]. The largest single component was £9.4 billion from public sector pay awards ^[1].

2. Missing context/alternative viewpoints

Several important contextual elements need to be considered:

• The Office for Budget Responsibility (OBR) initially identified a much smaller £9.5 billion shortfall ^[2], suggesting a significant discrepancy between different assessments.
• The term "black hole" itself is potentially misleading as it removes political agency from fiscal decisions ^[3].
• Many of the financial pressures were "entirely predictable," though some were genuinely greater than anticipated ^[4].
• The figure includes various other pressures beyond pay awards, such as asylum system costs and inflation ^[1].

3. Potential misinformation/bias in the original statement

The simple question of whether the "black hole" is real oversimplifies a complex fiscal issue:

• Political Framing: Labour characterizes it as a "black hole" while Conservative leaders dispute this characterization ^[2]. Paul Johnson suggests Labour may be "overegging" the claim ^[2].
• Measurement Discrepancy: The figure measures different things than previous deficit calculations ^[5], making direct comparisons potentially misleading.
• Timing Context: The government argues the difference between the OBR's £9.5 billion figure and the full £22 billion comes from spending pressures that emerged between February and July 2024 ^[2].

The Institute for Fiscal Studies' position provides a balanced view: while some spending pressures were foreseeable, the total pressures appear larger than initially understood ^[5].