Starmer Accused of Misleading Britain Over Chagos Deal Costs as OBR Denies Any Involvement

Summary: Sir Keir Starmer is facing renewed scrutiny over the Government’s costings for handing sovereignty of the Chagos Islands to Mauritius after the Office for Budget Responsibility (OBR) said it was not contacted about the treaty and has not modelled its financial impact.

Row over whether the OBR backed Chagos costings

Sir Keir Starmer has been accused by Conservatives of misleading the public after linking the Government’s Chagos costings to the Office for Budget Responsibility (OBR).

The Prime Minister previously said the deal would cost an average of £101m per year, or £3.4bn overall, describing that figure as a “net cost” presented in the way the Government and the OBR “count the cost” of public sector projects.

“That [£3.4bn] is the net cost and the reason it’s put in those terms is because that is how the Government accounts for it, it’s how the OBR counts the cost, and it’s the way public sector projects are measured.”

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However, the OBR has now stated it was not contacted by HM Treasury, the Ministry of Defence (MoD), or the Government Actuary’s Department about the treaty’s costs and has not undertaken modelling.

“The OBR does not hold any information on the costs or financial impacts of the specific treaty over the future sovereignty of the Chagos archipelago.

We can confirm that we have not been contacted by HM Treasury, MoD or the Government Actuary’s Department. As a result, we have not undertaken any modelling of these costs.”

Conservative claims the real price tag is far higher

Conservatives argue the Government’s headline figure understates the full long-term cost, and they are urging ministers to scrap the agreement.

The dispute has been sharpened by earlier reporting that the Government’s own estimate was significantly higher than the publicly stated £3.4bn.

Tory leader Kemi Badenoch has described the arrangement as a “Chagos surrender deal” and has publicly suggested a cost of £35bn.

Shadow foreign secretary Dame Priti Patel said the Prime Minister had tried to shield the policy behind the budget watchdog while leaving it uninformed about the deal.

“Keir Starmer is trying to mislead the public on the true costs of his £35bn ‘Chagos surrender deal’.

It is disgraceful and dishonest that he has sought to use the OBR as a smokescreen, all while keeping the OBR itself in the dark.”

Government denies wrongdoing and defends Starmer’s wording

The Foreign Office has rejected the accusation that the Prime Minister overstated the OBR’s role.

Officials insisted Sir Keir’s comments about how costs are presented were “completely accurate” and said any suggestion otherwise was “categorically untrue”.

The Government position, as set out previously, is that the £3.4bn figure reflects a net-presented cost consistent with how public sector projects are typically accounted for.

Critics counter that the public understood the Prime Minister to be claiming the OBR had been directly engaged on the treaty or had endorsed the figures.

Why this matters politically and what happens next

The argument is not just about arithmetic. It goes to transparency, institutional trust, and whether the Government’s narrative matches the paper trail.

It also risks reigniting tensions between ministers and the OBR after earlier frictions following the November Budget.

Opposition figures are likely to press for clearer disclosure of the underlying assumptions behind the Government’s figures, including timelines, inflation treatment, and any linked security or basing commitments.

If further documentation emerges showing substantially higher internal projections, the dispute could expand from a communications row into a broader challenge over fiscal credibility and accountability.