Chancellor George Osborne rose to deliver his 2013 Budget Statement to the House of Commons at 12.32pm.

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Economy

- The GDP growth in 2014 is forecast to be 1.8%, then 2.3% in 2015, 2.7% in 2016 and 2.8% in 2017, according to the Office for Budget Responsibility (OBR). In the short-term it predicts the UK will avoid a second quarter of negative growth and a triple-dip recession.

- The deficit has been cut by a third from 11.2% of GDP in 2009/10 to a predicted 7.4% this year. It is expected to fall to 6.8% next year, 5.9% in 2014/15, then 5%, 3.4% and 2.2% by 2017/18.

- The OBR forecasts higher employment, with 600,000 more jobs expected in 2013 than this time last year.

- Borrowing predicted to fall from £108 billion next year to £97 billion in 2014/15, then £87 billion, £61 billion and £42 billion in following years. Meanwhile, the proportion of national income spent by the state has fallen from 47.4% three years ago to 43.6% today and is on course to reach 40.5% by the end of the period.

- Public sector net debt to be 75.9% of GDP this year then 79.2%, 82.6%, 85.1%, 85.6% in following years before falling to 84.8% in 2017/18.

- The Bank of England’s Monetary Policy Committee keeps 2% inflation target.

Cuts/Spending

- Whitehall department budgets to be cut by 1% after £11 billion underspend this year, while Mr Osborne will seek £11.5 billion savings in the spending review for 2015/16, up from the previously announced £10 billion. But spending on schools and health will be protected.

- The public sector pay cap of 1% is to be extended by one year in 2015/16. Mr Osborne said “substantial savings” had to be found in annual progression pay rises in parts of the public sector.

- But the military will receive the full recommended increase in “X-Factor” payment in May and will be exempted from changes to progression pay.

- There will be a new limit on “annually managed expenditure”, which includes welfare budget, debt interest and payments to EU. The European budget deal secured by David Cameron saved the UK £3.5 billion, according to the OBR.

- Infrastructure plans to be boosted by £3 billion a year from 2015/16, a total of £15 billion over the next decade.

- The Government intends to take forward two major carbon capture and storage projects.

:: There will be a “generous” new tax regime to promote early investment in shale gas, while there will be tax incentives for the manufacture of ultra low emission vehicles.

Taxes and welfare

- Mr Osborne said corporation tax will be reduced by a further 1% to 20% in April 2015, while small company and main rates of corporation tax will be merged at 20p. Reductions in corporate tax will be paid for by increasing the bank levy rate to 0.142% next year.

- Help for employees includes more generous shareholder status, Capital Gains Tax relief for sales of business to workers, and a doubling to £10,000 for tax free loans for commuters’ season tickets.

- There will be a large new package of measures on tax avoidance and evasion to bring in £3 billion in unpaid taxes.

- New Employment Allowance will take the first £2,000 off the employer National Insurance bill of every company in the country. Around 450,000 small businesses - one third of all employers - will pay no employer National Insurance at all after the introduction of Employment Allowance in April next year.

- Rise in personal allowance brought forward to 2014. This will mean no income tax will be paid on the first £10,000 of earnings.

- The Capital Gains Tax holiday is to be extended.

- Tax-free child care vouchers worth £1,200 per child and increased support for families with children on universal credit.

Pensions and social care

- The flat rate pension worth £144 a week will be brought forward to 2016.

- The cap on social care costs will be introduced in 2017 and protect savings above £72,000, while the threshold for means-tested help is to be raised from £23,000 to £118,000.

- There will be help for Equitable Life policy holders extended to those who bought with-profits annuities before 1992, with payments of £5,000 and extra £5,000 for those on lowest incomes.

Housing

- A new Help-to-Buy scheme for those struggling to find mortgage deposits will include £3.5 billion for shared equity loans, and a Government interest-free loan worth 20% of the value of a new build house.

- The new mortgage guarantee, sufficient to support £130 billion worth of loans, will be introduced to help people who cannot afford a big deposit.

Fuel and beer duty

- This September’s planned rise in fuel duty rise has been scrapped.

- The planned 3p rise in beer duty tax has also been scrapped and replaced by a 1p cut in duty on a pint of beer.

- The beer duty escalator is axed but planned rises for all other alcohol duties will be maintained.

The Chancellor sat down at 1.36pm.

7 comments

  • thank goodness some sense from police commissioner.

    Report this comment

    bluelight

    Wednesday, March 20, 2013

  • "The chancellor had over £11bn of under-spending in his arsenal and should have done more to fire growth now, particularly through accelerating investment in infrastructure," said Terry Scuoler, chief executive of EEF, the manufacturers' organisation.

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    Peter Watson

    Thursday, March 21, 2013

  • @ Milecross - spot on. Alistair Darling could really swing it for Labour in 2015. He speaks with authority and is listened to. Unlike Ed Balls who seems to have some really serious behavioral problems. My 5 year old grand son is better behaved than him.

    Report this comment

    BG

    Wednesday, March 20, 2013

  • Another Treasury Day and another lamentable and childish performance by Ed Balls. Until the Labour party wakes up and rids themselves of this apology for a politician and replaces him with someone like Alistair Darling they are never going to be trusted with the managing the economy of this country ever again. Ed Miliband really needs to show some leadership and ditch his mate a.s.a.p.

    Report this comment

    BG

    Wednesday, March 20, 2013

  • Mr. Osborne Ilovetaxhavens is borrowing 426 million every day and until he enables the modernisation of our engineering sector and starts providing jobs for an increasingly vociferous young generation, he risks to get further into the mire, more of the same. Everyone can see this bonus and QE cash for keeps culture he is presiding over, so when and what is he's going to do about these billions bypassing the treasury.

    Report this comment

    ingo wagenknecht

    Thursday, March 21, 2013

  • Can't really see any suggestion of control, recovery, growth or anything positive. A handout to businesses in the form of lower taxes and NI, which the owners will gladly bank, but doubtful if it will do anything to stimulate growth and restrore confidence after almost 3 years of having the economy trashed and growth stifled. And what is this silly attempt to mislead by portraying the deficit as a percentage of GDP. Fact is borrowng is still rampant in spite of the so-called 'austerity' measures. An average £30 billion per year until the financial crisis, followed by an extra £300 billion in two years, does not explain why a further £350 billion has been borrowed in a mere 2 years and 8 months since the general election, with a forecast of well over half a trillion extra in all by the end of this parliament. Must be something to do with all the little eye-catching giveaways that have to be funded each time there's an impending election.

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    Police Commissioner ???

    Wednesday, March 20, 2013

  • @BG yes you are right . Alister darling was the only labour mp brave enough to tell us what a mess labour had left us in . His honesty nearly got him the sack off brown for telling us that labour was two hours away from a complete banking meltdown. He was the only labour mp to talk common sense

    Report this comment

    milecross

    Wednesday, March 20, 2013

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