By Peter Hoskin
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6.15pm: Thank you for tuning in today. Here, by way of drawing a line under this rolling blog, are some of the post-Budget articles from across the site. There'll be more Budget coverage tomorrow.
- ToryDiary: You get up early. You work hard. You save. You do the right thing. You make Britain what it is. We're on your side.
- We ask the ConservativeHome Jury: What did you make of today's Budget?
- Iain Anderson on Comment: The Chancellor reboots monetary policy?
- ThinkTankCentral: Centre right think tanks don't like Budget's complexity
- Local Government: Right to Buy boosted
- WATCH: George Osborne's entire Budget speech and Ed Miliband's response
4.15pm THE EMPLOYMENT GRAPH: Surprised by today's rise in unemployment? Perhaps we shouldn't have been. The OBR has, for some time, forecast a rise in unemployment at the beginning of this year – as well as plateauing employment. The figures they released today are actually an improvment on those in the Autumn Statement, but they still show this effect. According to the OBR, it will take until 2014 for employment levels to really pick up again:
3pm THE DEBT GRAPH: We already knew – as of the Autumn Statement – that George Osborne had missed his target to have the national debt declining as a percentage of GDP by 2015. Now he's missing it by more. On the OBR's latest forecasts, debt is higher in every year and will only start declining around 2017:
2.40pm: THE STRUCTURAL DEFICIT CHART: Phew! George Osborne hasn't missed in main fiscal rule to balance the structual deficit – i.e. that part of the deficit that would remain even when the economy is in good condition – within five years from now. As the OBR puts it, "Our central forecast shows the CACB [aka, structural deficit] in surplus by 0.8 per cent of GDP in 2017-18, implying that the Government is more likely than not to meet the mandate. Thanks to the Budget measures, the CACB is also just in surplus in 2016-17."
2.25pm THE BORROWING CHART: Is George Osborne borrowing less? Hm, it's as close as close could be. The OBR gives the figure for last year as £121 billion, and this year as £121 billion. Overall, the borrowing position has worsened. Indeed, it's forecasts that we'll still have a deficit that amounts to 2.2% of GDP in 2017/18.
2pm THE GROWTH CHART: The OBR's growth forecasts haven't changed all that much, except for this year – when growth is at 0.6 per cent, down from 1.2 per cent in the Autumn Statement:
1.35pm: Ed Miliband is delivering his response, but we'll tune out for now. Expect more reaction to the Budget on ConservativeHome shortly, including on this rolling blog.
1.32pm INSTA-REACTION TO GEORGE OSBORNE'S SPEECH: A weird, wobbly sort of a speech, which began with uncomfortable truths about the state of the public finances, dipped as Osborne's voice strained and croaked in the middle, and then recovered towards the end, with the tax cut announcements. As for the measures contained within it, the interest in in the detail. So much here – the Bank of England remit, the limts to AME spending, the fiscal forecasts – requires extra consideration. And what about the state-backed loans for homebuyers? It turns the Coalition into one grand mortgage-broker, and that ain't necessarily a good thing.
1.30pm: And Osborne's peroration concentrates on – yep, you guessed it – aspiration. "It's a budget for an aspiration nation," he says. For those who want to be "prosperous, solvent and free".
1.29pm: The final policy announcement of George Osborne's Budget speech is what he calls its "biggest tax cut". It does away with the first £2,000 of employers' National Insurance – making it cheaper for them to hire staff. Tis a good one for small businesses.
1.25pm: Yep, the personal allowance will be increased to £10,000 in 2014, a year sooner than originally planned. Osborne derives great glee from pointing out Labour's oscillating commitment to the 10p tax rate – and emphasises that the Coalition is delivering a 0p rate.
1.20pm: Osborne's doing his duty. He nods towards Robert Halfon as he confirms that this year's fuel duty hike will be scrapped. And he adds that the 6p beer duty rise won't just be cancelled, but that there will be a 1p cut instead. The escalator's gone, too.
1.16pm: …and there's a lot of it. The most singificant measure, though, is probably the £3.5 billion going towards loans for those looking to buy a home. Hm. This Govenrment could regret helping people into an ailing property market.
1.14pm: Osborne seems to be coming around to the "aspiration" part of his speech – and, indeed, the word crops up for the first time since that initial burst (see 12.35pm, below). He details the Coaltion's plans for tax-free childcare. And now he's moving onto affordable housing…
1.09pm: After his paean to business, Osborne has harsher words altogether for the well-off. He explains, in Labour's direction, that the rich will pay a greater proportion of overall income receipts than they did under thirteen years of Labour government. And he follows that up with "one of the largest ever packages of tax avoidance and evasion measures". We seem to get one of those every Budget, mind…
1.05pm: The Chancellor again confirms what the Evening Standard previously revealed: the main rate of corporation tax will be cut to 20 per cent by 2015. The Standard has apologised for tweeting out ifs cover early, by the say.
1pm: There's a lot hidden under the bonnet of this speech, I suspect. Not only will the new Bank remit bear more thought and discussion, but there's also Osborne's announcement of new limits on Annualy Managed Expenditure (which includes the welfare budget). He doesn't specify what – but could this be one of this Budget's most significant money-saving measures? And one of its most controversial?
12.58pm: There it is, the passage on capital spending – which I previewed yesterday. Aside from what we knew, capital spending will be increased by £3 billion a year from 2015-16. "By investing in the economic artries of this country we will get growth flowing to every part of it," says the Chancellor. The new emphasis on infrastructure is one of the most significant changes in the Coalition's approach to deficit reduction – philosophically and rhetorically, if not in terms of the money involved.
12.52pm: Osborne confirms that the 1 per cent cap on public sector pay rises will be extended to 2015-16. There will also be restrictions applied to the pay progression schemes that apply in the public sector. The 1.5 per cent pay rise for the Armed Forces will go ahead.
12.47pm: Important. George Osborne has updated the Bank of England's monetary remit. Inflation will still be targetted at 2% – but he's changing a lot of the detail around it. For instance, there will be more transparency about the "trade-offs" that the bank is making to balance growth against inflation. Apparently, Mark Carney has agreed to the new framework.
Until we see the detail, it's worth re-reading Andrew Lilico's post on the Bank's remit from earlier.
12.45pm: George Osborne rather rattled through the key fiscal forecasts for the debt and the deficit, so we'll have to wait for the Red Book itself for the detail. It doesn't sound encouraging, through. The national debt will will only start falling as a percentage on GDP in 2017-18, two years outside the bounds of Mr Osborne's original fiscal rule. And the deficit will still be 2.2 per cent in that year, too. The Opposition benches are roaring.
12.40pm: Osborne is taking time to tell the good news story on employment – a higher employment rate than that left by Labour, etc – despite today's figures.
12.38pm: George Osborne confirms what the Standard splash revealed: the OBR's forecast for growth this year has been reduced to 0.6 per cent, down from 1.2 per cent in December. He adds, though, that the OBR doesn't foresee a triple-dip recession.
12.35pm: Five minutes into George Osborne's speech, and he still hasn't got down to specifics. Its two main themes were struck in the first two lines: "This is a Budget for people who aspire to work hard and get on. A Budget for people who realise that there are no easy answers to problems buiolt up over many years…" The A-word, "aspiration" has already cropped up a half-dozen times.
12.20pm: Ten minutes to go, but the Evening Standard's cover seems to feature quite a bit of the Budget's content already. Click for a larger version – apparently, the OBR is forecasting growth of just 0.6 per cent this year.
Noon: Turns out that George Osborne joining Twitter wasn't the most important bit of pre-Budget news this morning: unemployment rose between November and January, the first increase for around a year. The rise wasn't huge – 7,000 on the previous quarter – but it will add to the grim catalogue of ecomonic and fiscal figures surrounding this Budget. As he sits through PMQs, waiting to give his speech, Mr Osborne might prefer to dwell on some of the positives implicit within today's employment figures – overall employment is still higher than the level the Coalition inherited, for instance. Or, alternatively, there's this graph (via James Plunkett) which suggests how the rising personal allowance is, effectively, boosting people's wages:
11.32am: Courtesy of the Beeb, a picture of Osborne on the steps of No.11, with his little red box…
11.30am: The speculation will be over in a couple of hours, but, in the meantime, let’s
speculate. Here are some of the potential Budget measures that the papers have
reported over the past few days:
billion of cuts to departmental current budgets, to fund extra capital
billion to build new homes.
allowance to be raised to £10,000 in 2014.
duty to be frozen this year.
duty rise of 6p to be scrapped – and the beer duty escalator along with it.
Forces to be award a pay rise.
on public sector pay elsewhere.
Welcome to ConservativeHome's rolling blog for Budget day. It's here where
we'll bring you coverage of, and reaction to, George Osborne's fourth Budget –
including live blogging of his speech later. But what better place to start
than ConHome's own selection of Budget-related posts from the past ten days or
so? Here they are, for your reading pleasure:
- ToryDiary: What's the Chancellor's policy towards
- Margot James MP: Why the Next Eleven group of countries offer exporting wins for Britain
- Andrew Lilico: The Bank of England's target may change in the Budget, but probably in
the wrong way
Corlett on Comment: Conservatives should want to tax property
fairly. Here's how they could
- MPsETC: George Osborne's biggest Budget-day
decision – he's joined Twitter
- ToryDiary: Your five-point checklist for tomorrow’s
- ToryDiary: Osborne reheats one of the capital ideas
from his Autumn Statement
- Greg Clark
MP’s Weekly Letter from a Treasury Minister: National growth requires local growth – that's why we're
backing Lord Heseltine's plans
Zahawi MP: It's time to "encourage"
building on derelict and vacant land
Baldwin MP & Natalie Elphicke: A Building Society ISA to boost Britain’s
- Dr Lee
Rotherham: If we put our national debt into context,
there's even more reason to fear it
- Mark Field
MP on Comment: The Chancellor shouldn't seek Budget
Osborne under pressure:
- ToryDiary: The budget. A chance to boost capital
spending, cut NICs & freeze fuel duty. And tear a strip off the LibDems
- ToryDiary: This cautious Chancellor has no money and
is constrained by the Lib Dems. What tax cuts could he still offer?
- ToryDiary: Osborne promises to help people who want
to own a home, start a business, go out to work, enjoy retirement… but can he
- ToryDiary: UKplc is flatlining but Labour has no
lead on economic competence. What will happen if there's a modest economic
- ToryDiary: Big spending cuts are needed but not
- Ed Staite
on Comment: George Osborne must rip-up convention to
deliver a Budget speech of spectacular simplicity
Anderson on Comment: Personal finances at last getting their
place in ‘The Sun’
- MPsETC: Lord Lawson says that Osborne has no
"growth button" to press
- MPsETC: What Tory parliamentarians want to see in
- LeftWatch: Balls to Osborne: Go on, borrow more