This liveblog is now closed, but you can continue to review all the analysis of Budget day here. Or read Fraser Nelson’s ‘Six Scary Graphs’ post on the worst recovery in history, or James Forsyth’s political analysis of today’s events.


18.30: This liveblog is now closing, but we’ll keep you updated on all the details on Coffee House throughout the evening.

17.30: Ed Balls gave a briefing on the Budget details this afternoon in Parliament. He had some good soundbites on the beer duty escalator, but he was as keen to talk about a measure from last year’s Budget – scrapping the 50p rate – as he was about anything else. Here are the details.
16.33 Our political editor James Forsyth says George Osborne will have been pleased by the cheers of his own side as he finished his speech. And as for the next few days of unwinding after the Budget, his money is on finding out how the government has managed to get the deficit down by £100 million.

16.18 Isabel says the Help to Buy scheme, as well as answering a key Tory demand to support home ownership, is a boost for Eric Pickles. The Communities Secretary has been arguing for months that the Treasury shouldn’t try to relax planning rules any further because the real blockage for the construction of more housing is availability of credit, not the planning system. Today’s announcement shows he’s got his way – for now.

15.29 Isabel reports:

I’ve just spoken to Robert Halfon who is, as you might expect, thrilled with today’s announcement on fuel duty. He says: ‘I had had some nods and winks about it, but I’d never been 100 per cent sure that they’d do it until Osborne said it: you can never quite tell. The government have done more than any other government in the last 10 years on this issue. I think this is the best Budget Osborne has done. I think it’s cost of living and jobs budget. Clearly the fuel duty and low taxes for low earners were great, and also this Employment Allowance for small businesses is great. It blew me away.’

Halfon is a loyal MP who campaigns hard on what he calls ‘white van Conservatism’. But when I spoke to the more rebellious and outspoken Mark Pritchard, he was impressed too. He said: ‘This is a good Budget for the UK – and for the Chancellor personally.’

15:22  Earlier, we posted five boxes that Osborne needed to tick to emerge unscathed from today’s Budget. So did he meet the challenge? Isabel has posted some thoughts here.

14:54  So is the deficit falling this year? And will it fall next year? It depends which definition you use (and don’t forget these forecasts involve a lot of uncertainty): 

14.01 Here’s George Osborne’s Budget in full. 

13:58 Steve Rotherham jokes: ‘Is the Chancellor becoming the Baldrick of politics? He keeps thinking he has a cunning plan, but everyone else thinks he’s doomed for failure.’

13:44 At the next election, the deficit will still be 5.9% of GDP: the biggest in the west.

13:41 Is the deficit falling this year? The OBR says no: borrowing at £121 billion (excluding the Royal Mail pension and APF transfers), unchanged from last year. And it might not fall next year either: the forecast is for £120 billion of borrowing.

13:39 Triple dip? OBR forecast is for just 0.1% growth in 2013 Q1, just escaping a triple dip. But that could easily end up negative

13:28James Forsyth: ‘The cut in beer duty is meant to be a reverse pasty tax, showing that Osborne understands the importance of the little pleasures in life.’

13:27 Osborne name-checks the people he’s targeting with his budget:

‘If you want to own your own home; 
If you want help with your childcare bills; 
If you want to start your own business; 
Or give someone a job; 
If you want to save for your retirement; 
And leave your home to your children; 
If you want to work hard and get on; we are on your side.’

13:26 The biggest tax cut in the Budget, £2,000 to every company:

‘To help create jobs and back small businesses in this country I am today creating the Employment Allowance.
The Employment Allowance will work by taking the first two thousand pounds off the employer National Insurance bill of every company.

It’s a tax off jobs.’

13:24 Osborne jokes about Labour’s 10p tax proposal: “We’ve turned their 10p plan into a 0p plan”

13:22  So the personal allowance will rise to £10,000 next year. Big win for the Liberal Democrats — it was the top policy in their 2010 manifesto. And big cheers from the Lib Dem benches as Osborne announces it. It means that anyone earning £10,000–£41,000 will pay £705 less income tax in 2014-15 than they would’ve in 2010-11.

13:20 Here’s the beer duty cut we were promised:

‘I intend to maintain the planned rise for all alcohol duties – with the exception of beer. We will now scrap the beer duty escalator altogether.

And instead of the 3p rise in beer duty tax planned for this year I am cancelling it altogether. That’s the freeze people have been campaigning for.

But I’m going to go one step further and I am going to cut beer duty by 1p.

We’re taking a penny off a pint.’

13:18 Another fuel-duty freeze, and a name-check for Robert Halfon:

‘Today, I am cancelling this September’s fuel duty increase altogether.

Petrol will now be 13 pence per litre cheaper than if we had not acted over these last two years to freeze fuel duty.’

13:15 Osborne announces a new Help to Buy initiative, essentially government-subsidised home-buying:

‘First, we’re going to commit £3.5 billion of capital spending over the next three years to shared equity loans.

From the beginning of next month, we will offer an equity loan worth up to 20 per cent of the value of a new build home – to anyone looking to move up the housing ladder.

You put down a five per cent deposit from your savings, and the government will loan you a further 20 per cent.

The loan is interest free for the first five years. It is repaid when the home is sold.’

13:12 Isabel Hardman: ‘Ed Miliband’s response to George Osborne’s statement will be more significant than usual for an opposition leader on Budget day. The Labour leader will have to make a judgement call on whether to call for someone’s head on the leak to the Evening Standard. Next to him, Ed Balls has spent most of the Budget statement studying a print out of that front page, occasionally waving it at Osborne.’

13:11 Here are those apology tweets from Joe Murphy of the Evening Standard:

 

 

13.09 Comment from James Forsyth on Osborne’s energy decisions: Osborne has always loathed green energy subsidies. His decision to exempt the Potteries from various green levies is only a hint of what he would do if he wasn’t in coalition

13:07 Osborne to reduce the main rate of corporation tax:

‘In April 2015 we will reduce the main rate of corporation tax by another 1 per cent.
Britain will have a 20 per cent rate of corporation tax – the lowest business tax of any major economy in the world.’

13:05  Osborne on financial services:

Today I am abolishing altogether stamp duty on shares traded on growth markets such as AIM.

In parts of Europe they’re introducing a financial transaction tax. Here in Britain we’re getting rid of one.’

13:03  James Forsyth:The Standard’s Budget leak is dominating the atmosphere in the Commons Chamber. Ed Balls, who I expect will lead on this in his response, is waving a print out of The Standard front. 

But the leak as well as being politically embarrassing has also denied Osborne the weapon of surprise. Balls and Miliband have been busy updating Labour’s response based on the Standard front page.’ 

 

13:02 Osborne backs Shale:

‘I am introducing a generous new tax regime, including a shale gas field allowance, to promote early investment.And by the summer, new planning guidance will be available alongside specific proposals to allow local communities to benefit.

Shale gas is part of the future.

And we will make it happen.’

13:00 Osborne’s small-business growth offerings:

To help small firms, we’ll increase by fivefold the value of government procurement budgets spent through the Small Business Research Initiative.

We will fund the proposal to make growth vouchers available to small firms seeking advice on how to expand.

And we’re putting new controls on what regulators can charge, and giving the Pensions Regulator a new requirement to have a regard for the growth prospects of employers.’

12:59

 

 

12:58 More infrastructure spending: 

‘On existing plans, capital spending is still due to fall back in 2015-16.

I don’t think that’s sensible.

So by using our extra savings from government departments, we will boost our infrastructure plans by £3 billion a year from 2015-16.

That’s £15 billion of extra capital spending over the next decade.’

12:57 A new limit to be added to Annual Managed Expenditure (which includes welfare spending) to stop it being “Unmanaged Expenditure”.

12:56 Leak controversy: The Evening Standard front page is all over Twitter, revealing the main points of the Budget. Joe Murphy, the political editor of the Evening Standard has already apologised. Here’s their front page:

 12:54 Osborne:I think they are difficult to justify when others in the public sector, and millions more in the private sector, have seen pay frozen or even cut.

I know that is tough but it is fair.

In difficult times with the inevitable trade off between paying people more and saving jobs, we should put jobs first.’

12:53 Osborne says Schools, Health and Aid budgets will remain protected.

12:51 Osborne announces new monetary policy framework for the Bank of England: ‘The new remit also recognises that the Monetary Policy Committee may need to use unconventional monetary instruments to support the economy while keeping inflation stable.’

12:49  The debt-to-GDP ratio won’t start falling until 2018: and even then only slightly. Predicted to peak at 85.6% in 2017. 

12:47 Osborne rejects “unfunded” tax cuts: ‘The tax cuts in this Budget aren’t borrowed; they are paid for.

12:46 Osborne:

‘Ask the British people and they’ll tell you: our problem as a country is not that we’re taxed too little but that the government spends too much.

I agree with them.’

12:43 Osborne says this year’s deficit will come in at £114bn — lower than last year. But that seems to include the effects of the APF transfer.

12.40 The productivity  puzzle deepens: OBR revises down growth forecasts but revises up employment forecasts. The evaporating growth: we won’t recover from the recession til 2017

12.38: Osborne emphasises storms in the eurozone, but also growth of exports to BRICs. 2013 growth downgraded from 1.2% to 0.6%

12.36 Labels it a ‘Budget for our Aspiration Nation‘.

12.36 Isabel Hardman is in the Chamber: ‘Whatever George Osborne says in the Chamber today, he’s already in danger of an omnishambles budget with the early publication of the Evening Standard front page. Don’t forget that Hugh Dalton was forced to resign in 1947 for giving his Budget to the same newspaper, with a story then appearing before he’d given his statement.’

12.35 Osborne echoes Miliband’s conference speech: ‘People have felt that the whole system was tilted against those who did the right thing.’
12.34 First mention of the global race: ‘Our nation is in a global race – competing alongside new centres of enterprise around the world for investment and jobs that can move anywhere.’

12.32 Osborne begins:

‘This is a Budget for people who aspire to work hard and get on.
It’s a Budget for people who realise there are no easy answers to problems built up over many years.
Just the painstaking work of putting right what went so badly wrong.’

12.30 And welcome to the Budget coverage. Prime Minister’s Questions has just finished, and George Osborne is on his feet.

 

Tags: Budget 2013, George Osborne, UK politics