Government opens probe into leak of Budget bank tax rise

The government has opened an inquiry into a possible leak of Budget details after news of Chancellor John Healey's decision to double the UK banking surcharge appeared in the press hours before he delivered his Budget. The Treasury committee of MPs said the inquiry is under way.

The Cabinet Office's Government Security Group is leading the probe. Treasury Permanent Secretary James Bowler wrote to the committee's chair, Dame Meg Hillier, to confirm it. He said he had been assured that no banks, their representatives or their trade bodies were briefed by the Treasury on the details of the surcharge changes before the Budget was published and the Chancellor spoke to the House. He added that there is a "necessary widening of the circle of knowledge within the government" before a Budget.

In the Budget, Healey raised the banking surcharge to six per cent for 15 months. Bloomberg had reported hours before the speech that the rise would be below the expected eight per cent and would be temporary. Shares in Lloyds, Natwest and Barclays rose after those reports.

Hillier said she suspects the inquiry will find no evidence of a breach, and she criticised what she called a "doom-loop" of dead-end investigations. She said she would be "pushing for answers" when Healey appears before the committee tomorrow.

Financial Conduct Authority chief Nikhil Rathi said in a letter to Hillier that the regulator will engage with officials on whether "any unlawful disclosure of inside information may have occurred". He said it stands ready to consider any evidence from the Cabinet Office and the Treasury.