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Treasury minister Greg Clark said that the row over whether David Cameron misrepresented the views of the Office for Budget Responsibility of the impact of austerity measures on the economy was over a technical detail.
Mr Clark said: "It's a technical point, but it is an important one. Every budget since we came into office has been analysed by the OBR. Because Government spending is part of national income, any reduction in it has always been part of the forecast.
"What David Cameron was addressing in his speech - was to where there has been an extra contribution to the relatively slower growth than was expected from policy.
"What Robert Chote and the OBR have said is they don't think that is the case, that actually the causes of the slower growth than they forecast, were oil prices, the financial sector and the Eurozone."
There's been embarrassing criticism of the Prime Minister's keynote speech on the economy from the independent economic watchdog set up by his government. Yesterday, David Cameron claimed spending cuts had not damaged growth and that the Office for Budget Responsibility agreed.
But today the head of that watchdog said the opposite was true.
From Westminster ITV News political correspondent Carl Dinnen reports:
The head of the independent fiscal watchdog the Office for Budget Responsibility criticised David Cameron for misrepresenting its views on the impact of austerity measures on the economy.
Here is what the Prime Minister said:
Shadow Chancellor Ed Balls said on Twitter that the letter from the Office for Budget Responsibility to Number 10, rebuking David Cameron over claims he made about the economy, was 'deeply embarrassing' for the Prime Minister.
Sir Alan Budd, the first chairman of the Office for Budget Responsibility , said he believed the OBR had rebuked David Cameron because he "made an error'.
Sir Alan was talking to BBC Radio 4's PM program.
In a letter sent to Number 10, the chairman of the Office for Budget Responsibility Robert Chote, said that it believed fiscal consolidation had "reduced economic growth over the past couple of years".
The Office for Budget Responsibility has published a letter sent to Number 10 by its chairman in which he took exception to claims made by David Cameron.
In the letter, Robert Chote criticised the PM's claim that austerity measures were not responsible for a dip in growth:
Mr Chote included the following quote from Mr Cameron's comments in his letter to Number 10:
A Downing Street spokesman said David Cameron made accurate claims about the economy when he explained why forecasts came in lower than expected.
The head of the independent Office for Budget Responsibility rebuked the PM for misrepresenting its position on the impact of austerity measures.
The head of the independent Office for Budget Responsibility (OBR) has rebuked the Prime Minister for misrepresenting its position on the impact of austerity measures.
Office for Budget Responsibility chairman Robert Chote wrote to David Cameron to dispute claims made in a high-profile speech yesterday.
Mr Cameron said the OBR was "absolutely clear that the deficit reduction plan is not responsible" for depressed growth - "in fact, quite the opposite".
But Mr Chote insisted that it in fact believed there was a short-term effect and that "fiscal consolidation measures have reduced economic growth over the past couple of years".
Latest ITV News reports
Hot water. The Prime Minister appears to have landed in quite a lot of it after the independent budget watchdog slapped down his comments.