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LIVE: Budget 2011
1720If you want to keep up to date, you can follow all the latest Budget developments throughout the evening on the BBC News website and on BBC TV and radio - Democracy Live will continue to follow events from the House of Commons. 1706That's it from us for the day, we're wrapping up our live coverage of the 2011 Budget, which, to recap, has seen fuel duty cut by 1p a litre, an increase in the personal tax allowance to £8,015 and a 2% cut in corporation tax - but also saw the chancellor revise growth figures down to 1.7% for 2011. It's been a busy day with some surprises but the debate over the winners and losers will continue for days to come. Many thanks for joining us and for all your tweets and emails. 1659 Much disagreement on the BBC News Channel between Lord Digby Jones, former CBI boss and a trade minister under Gordon Brown, and Nicola Smith from the Trades Union Congress. They didn't exactly see eye to eye on the Budget. Lord Jones thinks it will help businesses and was very pleased with the corporation tax cut. Ms Smith said it was the "no change" budget where the chancellor chose to stick with the "damaging" scale and speed of spending cuts - the result of which was rising unemployment and lower growth. As she tried to set out what she would do instead, Lord Jones repeatedly asked her: Where would you get the money from? The independent peer said he was not a cheerleader for the government: 'I don't do party politics'. 1658 BBC business editor Robert Peston tweets: "How boring or exciting did you find this budget? Note that history shows boring budgets often turn out to be better budgets. #bbcbudget" 1651Some concerns about the tax hike on oil companies from Labour peer Dame Anne Begg, chairwoman of the all-party Parliamentary group on offshore oil and gas. She is worried it will have a "devastating" impact on Aberdeen - which relies on the industry for its economy. 1648 Simon Meakes tweets: "What's the point of stabilising fuel prices at levels that cripple the average family budget? #bbcbudget" 1645Kitty Ussher, a former Labour Treasury minister, says nothing in the Budget would alter the growth rate this year - there were some measures that businesses would find encouraging but they were all in the "medium to long term", she says. 1644 Business editor Tim Weber tweets: "Oil industry reacts to Budget: New tax regime will decrease investment, increase imports, drive UK jobs abroad. #BBCbudget" 1643The suggestion that National Insurance and income tax could be merged has won praise from John Whiting, of the Chartered Institute of Taxation. It would help employers he says. Former Treasury minister Kitty Ussher says it's a good idea as a long-term measure. 1637 Phil Mackie tweets: "Motorists not completely overjoyed at fuel duty changes. They point out pump prices are still higher than ever. #BBCBudget" 1629 Peter Carter, chief executive of the Royal College of Nursing, says: "We are disappointed that the chancellor missed an opportunity to send a clear message that cuts to the NHS must stop. With the NHS in England having to find £20bn of savings because of the current financial climate, it is important that government rhetoric is matched with real protection for NHS patients."1625 Scottish National Party Treasury spokesman Stewart Hosie tells the Commons the Budget was "neutral" in its overall effect.1624 Veteran Tory MP David Amess has made a long speech, describing the Budget as "much brighter than I had expected", adding that he is "delighted" with several of its measures. As he winds up, the mention of the words "in conclusion" brings cheers from the Labour benches.1620 Jolyon Ralph, from London, writes: "Well... This morning 10.30am petrol at my local station (Carshalton BP) was 134.9 - just driving passed 30 minutes ago it had risen to 137.9! Presumably they'll drop it to 136.9 at 6pm to pass on our 1p saving!"
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1620 Chief economics correspondent for the BBC Hugh Pym tweets: "Chancellor calls his policy a "fair fuel stabiliser" - its not the stabiliser which was implied a few months ago. #BBCBudget" 1617 An official has denied Labour accusations that Justice Secretary Kenneth Clarke had a little doze as George Osborne delivered his Budget. But bookmaker Ladbrokes says it will pay out on bets at 16/1 that Mr Clarke would drop off during the chancellor's statement.1616 Eve Murphy, from Berkshire, writes: "These changes for new buyers are fine for those who have savings, but for those of us who are renting it's difficult for us to save up even 5% of the cost for a house due to VAT, debts and other rising costs. What options are there for us to get on the property ladder?"
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1614 Eric J, from London, writes: "A bit rich of Ed Balls to say 'the economy is finely balanced'. Who left it in the mess it's in, then, Mssrs Brown, Balls and co? Left to them it would have tipped over the edge into the company of Greece, Iceland, Portugal, etc. It has improved to 'finely balanced'"
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1607 In his maiden parliamentary speech, Labour's Dan Jarvis, the recent victor of the Barnsley Central by-election, says people in his constituency will be "hit hard" by rising living costs. It also faces "some of the deepest cuts in the country", he adds.1605 Labour Press Team tweets: "OBR says Corporation Tax cut last minute and likely to have no impact on growth or investment - B13, p75 http://bit.ly/eVId0a #budget" 1601 Conservative former cabinet minister John Redwood, who also headed the party's review on economic competitiveness, tells the Commons: "We are not going to have fast, sustained, above-average growth in this country unless we sort the banks out a bit more than we have done so far, in my view." Lending to businesses must increase, he argues.1556I asked Danny Alexander what would stop the oil companies passing on the cost of the extra tax onto consumers at the pump. His answer, give or take, was that he didn't think they would, but they'd be looking out for it. Hmmm. Read Stephanie Flanders' blog 1553 Some disquiet over the increase in spirits duty. The Scotch Whisky Association says: "The system discriminates against Scotch whisky in favour of other alcoholic drinks, undermining an industry that should be at the heart of the chancellor's export-led growth agenda."1549 Mark Littlewood, director-general of the Institute of Economic Affairs think-tank, says: "As a Budget that was intended to be about encouraging growth, this is a disappointment. Even on the areas where the chancellor is doing the right things, his reforms are tiny."1542 Perdita tweets: "#c4Budget Usually a budget will leave me thinking. This years has hardly touched us! Yes we'll save a tiny bit of fuel and a little tax." 1540 Hugh Thornbery, from the charity Action for Children, says: "Whilst some of the announcements in today's Budget will help families, we are particularly concerned for those who are at breaking point. The government must invest in support for families in need at the earliest possible stage. This is the most successful way to sustainably combat poverty and help those that need it most."1533 Aaron Porter, president of the National Union of Students, says: "The chancellor's continued silence on the successor scheme to the Education Maintenance Allowance, which provides vital support to young people from poorer families, is deeply disappointing. The decision to scrap EMA is disastrous in itself but the lack of an adequate replacement is further damage the prospects of many young people." 1527 Mark Wheatley, from Nottinghamshire, writes: "I did not see anything for commercial property owners who are at the receiving end of one of the most unfair taxes. Having to pay rates on empty buildings when there is no sales revenue. Tax is supposed to be related to income???"
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1524 Business Editor for the BBC Robert Peston tweets: "Ed Balls tells us that Osborne's stream of micro measures to promote growth are "very gordon-brownesque". Osborne will sue! #bbcbudget" 1522 Mark Smith, from Nottingham, tweets: "@BBC_HaveYourSay Why cant fuel costs on getting to work be allowed as a tax deduction or a mileage allowance for PAYE workers, same as S/E?" 1521 Ingrid McClure, from Runcorn, Cheshire, writes: "Building homes to rent for the less well off and the homeless I think would boost the economy. You would employ builders, joiners, electricians etc who then pay taxes"
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1518 Ed Balls says the economy is in a "very, very delicate position". George Osborne's political strategy could end up "in complete tatters", the shadow chancellor continues.1517 Rohit Patel, from Leighton Buzzard, writes: "As an independent newsagent I would like to say thanks but no thanks. I fear I will have to make redundancies as he has not or does not think that independent retailer is an integral part of society or the back bone of the economic recovery of this country"
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1516 Simon HB tweets: "And who knew that when 'reducing the deficit' was such a priority there'd be pots of cash to cut corporation tax?" 1515 Shadow chancellor Ed Balls says George Osborne has not reversed the effects of the VAT rise on fuel in January with his freeze on duty, and 1p cut in the current rate. Prices will increase by 2p a litre even after the announcement, he adds.1514 David Frost, director general of the British Chambers of Commerce, says there was a lot in the Budget to "give business the confidence to invest".1512 Presenter for BBC1's This Week and BBC2's Daily Politics Andrew Neil tweets: "If Portugal goes belly up tonight that will play to chancellor's fiscallly conservative agenda #budget2011 #bbcbudget" 1510 Friends of the Earth transport campaigner Richard Dyer says it is "very disappointing" about the air passenger duty freeze. "Aviation is a major contributor to climate change but it gets off lightly by not paying fuel tax or VAT."1509 Heather Murphy, from Yeovil, writes: "Regarding the proposed state pension of £140 this does not apply to existing pensioners. I retired early and paid six years voluntary contributions - it's outrageous if people paying in far less than me will get so much more"
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1507 The investment bank Barclays Capital warns that "there is a significant risk that in the medium term the deficit does not fall by as much as the government is projecting. In that case, the chancellor would face an unwelcome choice between implementing more tax hikes and spending cuts to keep the deficit reduction plan on track, or watering down the plan to support the economy."1505 It is unlikely the cuts have had a "deleterious" effect on the economy, as they "haven't happened yet", Paul Emmerson, deputy director of the Institute for Fiscal Studies says.1502 Political Correspondent for the BBC News Channel Laura Kuenssberg tweets: "OBR confirms - this recovery will be slower than the eighties and their unemployment forecast goes up #BBCBudget" 1457Institute of Directors boss Miles Templeman says: "We welcome the raft of supply-side measures announced in the Budget. The combination of reduced corporation tax and planning liberalisation will help to lift business confidence at a difficult time. However, the scale of deregulation in areas that really matter to business in general, such as employment law, is still very limited. And while the 21 new enterprise zones have real potential, we question why the whole of the UK can't be an enterprise zone."1456 Some reaction from the business world. John Cridland, director-general of the CBI, which represents large companies, says: "The chancellor has made clear the UK is open for business. The extra 1p cut in corporation tax will help firms increase investment. Meanwhile, significant changes to entrepreneurs' taxation will rightly focus much-needed support on businesses with growth potential."1454 In the Commons, Democratic Unionist Party MP Sammy Wilson says the figures in the Budget red book regarding enterprise zones will only mean £4m per zone.1450 Financial journalist Paul Lewis tweets: "@bbcstephanieflanders makes a v good point - how can gov stop oil companies from passing on tax to customers when they pay out more to gov." 1448 The Council of Mortgage Lenders says the new shared equity scheme for first-time buyers will provide "modest help" but would not "fundamentally change the landscape", but the Home Builders' Federation said it was a "vital and extremely positive move".1446 Tweetminster , a company that tracks comments on Twitter has been analysing what the buzz has been online around the Budget. The most "tweeted" announcement was the fuel duty cut - 9.5 tweets per second. This was followed by corporation tax changes at 8.8 tweets per second. Third was the 21 enterprise zones at 7.5 tweets per second. 1434One group of big companies won't be pleased: the oil and gas companies. They will pay an extra £1.8bn in tax this year and £2.24bn next year on their North Sea oil and gas production. If the likes of Shell and BP don't complain... I will drink a litre of their finest unleaded petrol. Read Robert Peston's blog 1433 Economics Editor for the BBC Stephanie Flanders tweets: "Can't see why energy companies won't pass on the cost - the stabiliser is related to the world oil price, not pump price. #bbcbudget" 1431How is the airline industry responding to the news that a rise in air passenger duty - due next month - is being delayed? Mike Carrivick, head of the Board of Airline Representatives in the UK, which represents 86 airlines, said it was welcome but didn't go far enough. He says the UK travel industry pays the highest aviation taxes in Europe and air passenger duty did not reflect the EU Emissions Trading Scheme (ETS) which airlines will pay into from January 2012: "Other EU countries have reduced or are removing existing taxes prior to the introduction of EU ETS." 1427Former Conservative chancellor Lord Lamont says he didn't hear Ed Miliband's quip about Mr Osborne being "Norman Lamont with an iPod". He tells the BBC: "I listened to the first two sentences of Ed Miliband and decided it wasn't worth listening to", he says. BBC political editor Nick Robinson says he made a slight error - Ed Miliband did, in fact, make one mention of the fuel duty cut in his speech.1425The Budget will be competing with some other big stories for the headlines on Thursday - while MPs have been in the Commons it has emerged that Hollywood legend Liz Taylor has died in her sleep. There's also been a bus explosion in Jerusalem, Japanese officials have warned that tap water in Tokyo is unfit for babies to drink due to radiation from the stricken nuclear plant, and there have been more air strikes in Libya.1423 Christian Moore, from Worksop, writes: "Mr Osborne states that public sector workers earning less than £21K will receive a "pay lift" of £250. I fall into this category but have been told that it is "optional" and not enforceable by the Local Goverment Organisation"
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1422Labour's Yvette Cooper tells the BBC that the fuel duty cut doesn't amount to much, it takes 1p off a litre of fuel, but the VAT rise in January added 3p to it, she says.1420BBC Newsnight's Iain Watson says: A strong response from the Labour leader who doesn't always rise to the parliamentary occasion. A surfeit of pre-scripted lines but two key messages - that the government isn't on the side of ordinary working families and that the deficit reduction plans are slowing, not encouraging, economic growth. But a bit of 'class war' sneaked in when George Osborne was attacked for going on his ski holiday as the economy struggled. Some of the voters Labour aspires to win back will be hoping to have enough cash to go 'on the piste' themselves.1418 Alan Dobson, from Northampton, writes: "Sadly I fear that their feeble attempts at placating a raging number of vehicle drivers and hauliers is doomed to failure. With fuel rising by a couple of pence a week it's laughable for the government to try to score points by freezing the duty increase. The only way they'll help now is to cut VAT back down to at least 17.5 % or down to 15%"
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1417 Kevin Lear, from Sunderland, writes: What a refreshing change, a budget that the average member of the public can understand instead of a 'devil in the detail' budget that we knew contained hidden bombs that could only be unravelled by Mensa qualified accountants three days later"
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1416Economics editor Stephanie Flanders say changes to the growth and borrowing forecasts were broadly as expected but the "micro-announcements" like the fuel duty and business announcements were what was attracting the attention. Merging tax and National Insurance is a hugely complicated issue, she says.1415 Marcus Slack, from Harpenden, writes: "How will putting up interest rates help keep inflation under control when it's being driven by rising fuel and food costs? As both of these are essential, how will having less money in people's pockets reduce them spending on necessities?"
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1413The BBC's political editor Nick Robinson says the chancellor had focused almost all his effort on the price of fuel to ease the squeeze people are feeling - and it was striking he had funded it by taking up to £2bn from oil companies. He adds that the measure on the "carbon price floor" - a tax on carbon dioxide emissions by companies - would raise £1.4bn in five years time. He notes that Ed Miliband did not mention fuel at all in his speech. 1411To see what the Budget might mean for you, take a look at our key points. 1408Chief Secretary to the Treasury Danny Alexander says the measures taken on fuel duty responded to people's concerns - as a Highlands MP he says he knows the pressure petrol prices put on motorists. 1403 Sacha, from Halifax, writes: "As a hopeful first time buyer, I want to know what help is going to be made available. Having had no pay rise in the past 2 years and my partner's increase not much to write home about, we are finding it increasingly difficult to try and raise any deposit, especially with the cost of general living sky high"
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1401BBC Newsnight's Iain Watson says: Ed Miliband attacks Nick Clegg personally as an "accomplice" to the Conservatives - there will be far more occasions in coming weeks when the Labour leader will try to drive a wedge between the deputy prime minister and the rest of his party - and, indeed, Lib Dem voters.1400The BBC's business editor Robert Peston says there are substantial tax cuts for big businesses which add up to about £2bn. Critics will say they are helping their friends in big business, but the government will argue that if tax rates are uncompetitive, big firms will move abroad and there would be fewer jobs and lower growth, he says. However, he thinks the banks won't be happy the chancellor's pushing up the bank levy - and big oil companies will be paying a lot more tax to pay for the fuel measures.1355We're going to switch our attention away from the Commons now and on to reaction from around the country. You can stay with the Commons debate on our Democracy Live site 1354BBC environment correspondent Richard Black says: £3bn for the Green Investment Bank is a big advance on the £1bn initial figure being proposed last year. But delaying until 2015 the bank's right to borrow money is likely to be heavily criticised by the renewables industry. The floor price for carbon could support companies' transition to green technologies but analyses suggest that even at £30 per tonne by 2020 it will only be on the edge of the prices required to drive serious innovation.
1350Labour's Ed Miliband wraps up his Budget response with the words "it's hurting but it's not working". Conservative MP, and chairman of the Treasury Select Committee, Andrew Tyrie is the next to ask questions.
1350 Liz Brunwin, from Henley, writes: "I think maternity rights, pay and leave are more than adequate and put a great deal of pressure on small businesses struggling to cope in this economic climate. The bottom line is that having children is your choice and any financial implications need to be taken into consideration when making that choice"
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1349Mr Miliband also suggested that Justice Secretary Ken Clarke fell asleep during the chancellor's speech - prompting calls of "alarm clock Britain" from Labour MPs. Nick Clegg coined the phrase to describe hard-working British taxpayers. 1347The chancellor is accused of having already taken money off families and having "the nerve" to ask them to be grateful when he gives them back a "fraction" of their own money. Mr Miliband says it's the same story with the fuel duty cut - as VAT on fuel has gone up.1346 Alexander Clark, from Newark, Notts, writes: "1p Drop in fuel ??? Fuel has risen by 20p per litre in the last year! I travel 140 miles a day to and from work! How is 1p cut going to help??? A cap on fuel prices would have been better.."
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1345Deputy Prime Minister Nick Clegg is also in Mr Miliband's firing line. The Labour leader says he is an "accomplice to the Tory plan". Much laughter from Ed Balls as he says it's no wonder no-one wants to share a platform with the deputy PM - a reference to his own decision not to stand alongside him when campaigning for a change to the voting system.1344At a time when the residents of so-called middle Britain are feeling a sharp squeeze in disposable income, and when homeowners fear that high-speed trains will be zooming past their back gardens and ugly superstores will be built at the front, Mr Osborne's Budget choices may not win a vast number of votes. Read Robert Peston's blog 1343The Labour leader says the government is no stranger to U-turns, but on the economy they were unwilling to change. He accuses them of "hubris and arrogance", and says Mr Osborne is "Norman Lamont with an iPod". The chancellor looks less than amused. 1340BBC Newsnight's Iain Watson says: As previously reported on Newsnight, the chancellor is guaranteeing no fuel duty escalator while the oil price remains high, but he has gone further by cutting fuel duty this year. But this isn't the fully fledged stabiliser that was talked about pre-election. The Conservatives' own private polling showed that fuel costs were voters main concern - and the party was worried that support for them was weakening in northern England as a result. 1339Labour's Ed Miliband says Mr Osborne's second Budget "tells the story of the failure of his first".1338Mr Miliband says other economies are growing more strongly than ever - while the UK downgrades its growth forecast. He says Mr Osborne is the "wrong type of chancellor". MP Lindsay Hoyle, who is chairing the debate, tells Tory MPs to calm down as noise levels rise.1336The personal tax cut for individuals will be outweighed for some by an important and dull sounding technical change - upgrading many tax allowances by the CPI measure of inflation rather than RPI is a tax increase. In other words, the tax free amount will be increased less than it would have been for ISAs, capital gains tax, and employee national insurance contributions. Read Nick Robinson's blog 1335Much noise from Conservative MPs and the front bench as Mr Miliband criticises the chancellor's deficit-cutting strategy. Shadow chancellor Ed Balls nods behind the Labour leader as he responds to the Budget. He has a dig at George Osborne for going on a skiing holiday.1334Labour MPs join Mr Miliband as he chants growth is "down, down, down". He says that didn't happen by chance, "it happened by choice". 1333Labour leader Ed Miliband is on his feet - he says the chancellor spoke for an hour, but could not bring himself to say that growth is "down" this year and next year.1332The chancellor says the fuel duty escalator that adds 1p to fuel duty on top of inflation each year will be axed for the rest of this Parliament. And after a 56-minute speech, the chancellor wraps up.1331The BBC's Ben Geoghegan says: Labour demanded that the government reduce VAT on fuel to reduce the "squeeze" on drivers. Instead the government is getting oil companies to pay for new fuel stabiliser when prices are high. This is the big surprise of the budget. 1331The new Fair Fuel Stabiliser will be funded by increasing the supplementary charge on North Sea oil and gas production from 20% to 32% from Thursday, he says, and fuel duty will be cut by 1p a litre from 6pm, he says. Big cheers from the government benches. 1330 Sonell Rhodes from Kingsclere writes: "I am a mum and pregnant with my second, what does the new budget have in store maternity rights, pay and leave and when will this come into account?"
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1328On to fuel duty now - it had been due to go up by 1p a litre above inflation next week, but Mr Osborne says a government has to "listen and respond" when oil prices rise. While revenues go up when oil price rises, other tax intake falls, he says. He rubbishes a Labour proposal to cut the VAT rise on fuel - which goes down well with his Conservative colleagues. He says a "fair fuel stabiliser" will be introduced from Thursday, which will raise an extra £2bn. The money will be used to delay the duty rise until next year.1326BBC Newsnight's Iain Watson says: The chancellor is signalling further rises in the state pension age - and more costly public service pensions. Unions will say people are required to work longer and pay more for their pensions, but it's trickier for Labour to oppose these measures outright. There is likely to be more consensus on the idea of a 'universal' state pension for all.1323A tax per plane, rather than per passenger, would be illegal under international law, says Mr Osborne. He says they will campaign to change the law. A planned air passenger duty rise will be delayed for a year, he says. There will be no further changes to alcohol duty, other than those already put in place by Labour. 1323 BBC business editor Robert Peston tweets: "Increased tax breaks for research by small companies and for capital investment by all companies. This looks like Osborne u-turn. #bbcbudget" 1322The chancellor confirms a rise in the personal tax allowance, which had been widely trailed, and says 1.1m lower paid people have now been taken out of income tax altogether. And he says no-one else will be pulled into the higher rate tax bracket as a result of the Budget. 1321There'll be help for families "who do pay their taxes but who struggle with the daily cost of living", Mr Osborne says - outlining measures such as the council tax freeze and more child tax credit for lower income families and a "pay lift" for public servants on less than £21,000.1320 Martyn Coupland tweets: "#BBCBudget Fingers crossed for a resolution to the fuel prices, people are struggling here!" 1320Tax avoidance is the next subject for the chancellor. Hh says three forms of stamp duty land tax avoidance will be shut down, among other measures which he says will raise £1bn a year.1319He says the Gift Aid changes are the "most radical reforms to charitable giving" for a long time and it's a"big help for the Big Society".1318Labour MPs shout as Mr Osborne says a society should also be judged on "compassion". The chancellor goes on to announce changes to Gift Aid to encourage giving.1317 The vision the chancellor outlined is a simpler, fairer tax system and private sector job creation in the regions, instead of what he dubbed a 'debt-fuelled economy' Read Nick Robinson's blog 1316On pensions, Mr Osborne says he's sure everyone will want to thank former Labour minister John Hutton for his report - to laughter from Tory benches. He says he accepts the reports findings and thinks similar changes should be made to MPs' pensions. He says he wants a "single-tier pension" so people know what to expect. Work and Pensions Secretary Iain Duncan Smith nods in the background. It won't apply to current pensioners, Mr Osborne says.131440,000 extra apprenticeships will be funded for young unemployed people.1312BBC Newsnight's Iain Watson says: The Green Investment Bank was agreed between the Lib Dems and the Conservatives - but the junior coalition party wanted it to be more like a 'real' bank rather than an agency of the Treasury but increasing its funding and bringing forward its inaugaraton should be enough to allow both coalition partners to sound positive about this.1313 Alexandra Hunter tweets: "Come on George work miracles - we all know we need one #budget" 1312 Paul writes: "As a single working professional who hasn't had a pay rise in 4 years, I want to know how this budget is going to affect me. My bank statement is just full of petrol and food purchases, I can't afford anything else."
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1312Twenty-four new university technical colleges will be funded, the chancellor says, and there will be 100,000 places in a new work experience scheme over the next few years. 1311The UK will become the first country in the world to introduce a carbon price floor for the power sector, he says.1310Mr Osborne says green taxes will increase as a proportion of total tax revenue and he commits an extra £2bn to the Green Investment Bank, which will start work earlier than planned, in 2012. 1309The small business rate relief holiday is being extended by one year to October 2012, at a cost of £370m, the chancellor says. 1308There'll be a £100m boost for science with investment in new facilities in Cambridge, Norwich, Harwell and Daresbury, funded from the bank levy, the chancellor says.1307There will be 21 "enterprise zones" - not 10 as reported, Mr Osborne says, and local authorities will be allowed to keep "business rate growth" in their zones.1306The BBC's Ben Geoghegan says: The chancellor has answered one of the big questions about tax reform, saying the government will consult on the merging of National Insurance and Income Tax. Some businesses had been calling for this in order to cut down on paperwork. NI was established in 1911 to fund pensions, other welfare payments and later the NHS. But this "contributory principle", the link between some benefits and NI payments, has weakened over the years. However, the political difficulty with it is that it could be perceived as a tax increase. For example, it could take the basic rate from 20p to 32p and top rate from 40p to 52p in the pound. Hence the need to take "a number of years" to sort it out. 1305£100m will be added to the science budget, Mr Osborne says. £200m extra will be invested in regional railways - including schemes in Manchester, and Swindon to Kemble. More money will be given to councils to repair the "winter potholes on our roads", he says.1304BBC Newsnight's Iain Watson says: Stressing 50p tax as a temporary measure will cheer the Tory right. If the tax take from the top rate turns out to be small following the chancellor's review, there will be a strong case for abolishing it before the election - if Labour oppose this they will be painted as a party of higher tax and lower aspirations.
1303Profits from the bank levy will fund a new £250m shared equity scheme for first-time buyers - which will help 10,000 families get onto the housing ladder for the first time, Mr Osborne says.
1302 BBC business editor Robert Peston tweets: "Treasury will review whether 50% tax rate is actually raising extra money - and will also look at raising revenue from "high value" property" 1302The "non-doms" charge is being increased to £50,000 for those who have been in the country 12 years - raising more than £200m, Mr Osborne says.1301 Martin Buck, from Taunton, Somerset, writes: "If PAYe and NI are merged, how will this affect retired people who are still working, as they do not currently pay NI?"
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1300The top 50p tax rate is regarded as a "temporary measure" but now is not the time to remove it, he says, when the less well-off are under pressure. Labour MPs laugh when he repeats his line that "we are all in this together". However, Mr Osborne says he has asked customs officials to look into how much it is raising.1259Income Tax relief on the Enterprise Investment Scheme will increase from 20% to 30% in April 2011, says Mr Osborne.1257BBC Newsnight's Iain Watson says: 43 tax reliefs abolished - that leaves about 1,000 more to go! The bigger simplification is aligning NI and income tax - there is now a review, but there is a downside for governments, as people become more aware of the 'true' rate of tax on income - tax and national insurance combined would take around a third of basic rate payers income (excluding allowances) and there are upfront costs to reform; but as well as simplyfing the system, some on the right believe that this will put a downward pressure on total tax take.
1256All planning bodies will be expected to prioritise jobs and growth, says Mr Osborne. Cumbersome planning laws "stand in the way of new jobs", he says.
1254Here is some footage of the protest earlier, where the chancellor's journey to Parliament was disrupted by people lying in front of his car.1254There will be a moratorium of three years for small business on "new domestic regulation", Mr Osborne says.1253 James, from Northampton, writes: "I am a 24 years old graduate who is lucky to have a job, nothing relating to my degree and not very well paid. I see a lot of people commenting asking for help from this budget and I can't believe how "spoon fed" some people are in this country and don't help themselves."
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1252Corporation Tax will be cut by 2% - more than the 1% previously announced, says the chancellor. That goes down well with Tory MPs. It will be the lowest in the G7, he says, adding: "Britain is open for business". He also says he will adjust the bank levy to ensure it's not a net gain for banks. 1251The BBC's Ben Geoghegan says: Growth forecast is revised down for next year from 2.1% to 1.7% which many had forecast - this after growth was lower than expected in the final quarter of last year. Labour will argue this is a sign that cuts ("too far and too fast") are slowing the economy. 1250 Jo Dench-Owens, from Canterbury, writes: "Absolutely agree with the relief needed for Small Businesses. Our PAYE/NICS/VAT have all become entirely unmanageable. Our only option to make running our business worthwhile will be to cut our staff. We employ 26 people, and are therefore contributing to the economy, and yet we are having to make changes that will mean people lose their jobs."
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1249Mr Osborne says the government will consult on merging National Insurance and Income Tax. The goal, he says, is to simplify them - not increase taxes. It will make the tax system "fit for the modern age", he says, to cheers from his own side. But it will take years, he adds.1248Borrowing will fall to £122bn next year, the chancellor says, and will contniue to fall until it reaches £29bn in 2015/6.​1247​Borrowing for this year will be £146bn - below target, the chancellor confirms.1246The extra cost of military action in Libya is being funded by the Treasury reserve, Mr Osborne says - rather than the Ministry of Defence.1245The chancellor says he will meet his target that debt should be falling as a percentage of GDP by 2015/16 - in fact he will meet it one year earlier, he adds.
1244Mr Osborne says inflation is expected to be between 4% and 5% this year - dropping to 2.5% next year and 2% in two years' time
1243BBC Newsnight's Iain Watson says: Growth is, and will continue to be, a key political battleground. Labour of course want to see economic growth too - but their method of achieving it is by cutting the defict less quickly and putting money into initiatives such as the Future Jobs Fund; the coalition hopes to pump prime the economy by cutting regulations on business and keeping interest rates low. Look out for a range of specific measures to cut red tape later in the Budget
1242Going through the new forecasts from the Office for Budget Responsibility, he says growth is predicted to be 1.7% for 2011, 2.5% next year, 2.9% in 2013, 2.9% in 2014 and 2.8% in 2015.
1240The chancellor promises not to rattle through growth figures - he says average quarterly growth will be higher than forecast - but the annual forecast will be revised down to 1.7% 1237Mr Osborne says measures he will announce will be "fiscally neutral across the period", neither raising tax nor offering giveaways. 1235Mr Osborne says Britain has the practically the same interest rates as Germany - despite a huge Budget deficit. He says Britain needs to "catch up" having lost ground in the world's economy - as he points the finger at the previous Labour government 1233 Labour's Adrian Bailey asks for reassurance that nuclear power policy has not changed. Mr Cameron says issues says the government is making sure it has a future.1232 Mr Cameron accuses Labour of wanting to keep the status quo in the NHS, arguing that this will not help cancer survival rates. He looks at the opposition benches and proclaims: "What a backward step and what a backward lot."1228 Tory Stephen Metcalfe says Labour left the economy in a "dreadful state". The PM says the Budget deficit was bigger than in Spain, Portugal and Greece.1227 Political Correspondent for the BBC News Channel Laura Kuenssberg tweets: "PMQs always a bit strange before budget - everyone waiting for main event...wide range of questions tho" 1226 Independent Labour MP Denis MacShane says there is evidence some unaccompanied children arriving at London St Pancras's Eurostar terminal may be being trafficked. Mr Cameron pledges to do as much as possible to help prevent trafficking.1224 Business Editor for the BBC Robert Peston tweets: "If corporation tax is cut, I would expect clampdown on tax breaks for the wealthy. Offshore employee benefit trusts vulnerable #bbcbudget" 1222 Labour's Emma Reynolds accuses the PM of "talking down" the NHS. Mr Cameron says reform is needed to sefeguard it.1221 Labour's Angela Smith asks whether Nick Clegg, a Sheffield MP, has asked for the cancelled loan to Sheffield Forgemasters to be reinstated. The PM says the company has other means of getting money. 1219 Labour's Brian Donohoe asks what will happen to protect legal aid and end abuses of the funds. Mr Cameron says the UK spends "way more per head" than comparable countries and this must be reformed.1218 Tory Richard Fuller asks how many councils have frozen or reduced council tax. Mr Cameron says they have all agreed to take part.1217 A friendly question from a Tory MP on the deficit - he stumbles over his lines, to laughter from the Labour benches. Mr Cameron says the OECD backs the coalition's plans.1216 Ed Miliband urges Mr Cameron to drop the disability living allowance plan. The PM again says it is not true. That ends the leaders' clash for this week. Mr Miliband can now get on with focusing on his response to the Budget.1216The BBC's Ben Geoghegan says: Interesting that Ed Miliband asked about targeting Colonel Gaddafi, a question which has caused some confusion this week. The Prime Minister didn't rule it out. Targeting would be "in-line" with the UN resolution but he won't be giving a running commentary.1215The BBC's Ben Geoghegan says: The Chancellor is expected to speak for up to an hour when he delivers the budget in a few minutes from now - it's his 3rd big set-piece economic speech since the coalition came to power. Lots of measures have been leaked to the press already and Mr Osborne has already put in place the biggest tax and spend changes. But you don't have a budget without some surprises. 1213 The noise level rises as Ed Miliband returns. He accuses the government of wanting to cut the disability living allowance, by removing the mobility component. The PM says he is not.1212 Tory Gavin Barwell says some of the government's buildings should move from central London to Croydon. Mr Cameron says more money can be saved, perhaps including some departments going there.1210 After a question from Tory David Amess, Mr Cameron says he wants to involve charities more in healthcare.1209 The Labour leader asks for clarification about the targeting of Col Gaddafi. Mr Cameron says all targets must be in line with UN Security Resolution 1973, adding that he does not propose to give a "running commentary" on operations. The first batch of questions from Mr Miliband ends.1208David Cameron says Kuwait and Jordan will be providing logistics support re Libya.1207 Mr Miliband asks about the role of Arab nations in the Libya operation. The PM says he hopes for "further support" but the backing of the Arab League is "clear".1206 Labour leader Ed Miliband asks for an update on military operations in Libya. Mr Cameron says the no-fly zone is in place, with 11 nations contributing aircraft to the operation. There is "great concern" over Col Gaddafi's actions, he adds.1205 Ed, from London, writes: "As a small business owner any cut in corporation tax or employers national insurance would enable us to put more money into growing the company and employing more staff. If this is really a budget for growth, please make it so."
Have Your Say
1201Prime Minister's Questions has got under way in the House of Commons. 1200 Muriel, from Aberdeenshire, writes: "I'm 61, single, a professional lady (role), we've had no salary increase since 2009, fuel is now 140/litre for diesel, food prices creeping up and up, about to be made redundant (31st March), and now I'm struggling to find another job to pay my mortgage that runs until I'm 75. I have no pension and no savings now. How is this government/budget going to help people like me?"
Have Your Say
1159The Commons is filling up as prime minister's questions approaches - there's much noise in the chamber as Northern Ireland Secretary Owen Paterson wraps up the current session. David Cameron is in his seat.1153 Anna, from Worksop, writes: "I found out last week that from next month I lose a third of my tax credits, bills are on the increase and I'm getting no payrise at work. I run the risk of not being able to afford to work anymore, you say you want people to work - why are you not helping us single parents more?"
Have Your Say
1151 Claire Long tweets: "Be realistic people. Cameron doesn't care about the working class. Don't expect any help. We're on our own. #bbcbudget" 1149 BBC business editor Robert Peston tweets: "I have just started marathon 4 hour #bbcbudget broadcast. U have been warned. Goodness only knows what rubbish I'll be spouting in 240 mins" 1147 Financial journalist Paul Lewis tweets: "Watch out for OBR RPI Q3 prediction to be higher than 3.5% of Nov report, Used to raise duty on alcohol, tobacco, fuel #BBCBudget" 1145Protesters are in Westminster so it is not surprising Mr Osborne takes a car for the short journey from Downing Street to Parliament. That doesn't stop some protesters lying down in front of it, however. 1140 George Osborne is off from Downing Street to the Commons for prime minister's questions. The BBC's economics editor Stephanie Flanders says it will not be a "feel good" budget and the best Mr Osborne can do is try to make sure we don't come away from it feeling even worse. 1137 Stephen Scott, from Edinburgh, tweets: "As a father and a husband in a fully employed family, what can this budget do to help me and my family? Probably nothing...#bbcbudget" 1136The BBC's political editor Nick Robinson says Mr Osborne will want to send a message he is "easing the squeeze" on people - as inflation rises. But he expects more to be in the Budget than an announcement on raising personal tax allowances. Fuel might well be the big story of the day, he says. The chancellor and his team are posing for a photo outside No 11, with the new red box. 1134Ahead of the Budget, the prime minister is expected to use prime minister's questions to update MPs about military action in Libya.1133 The Freight Transport Association's Ian Gallagher is not only hoping for the 1p a litre above inflation rise in fuel duty to be cancelled, but he also wants the much-floated idea of a fuel duty stabiliser - which would see duty fall when the oil price goes up - to be introduced. Rising fuel prices are hitting his members hard, he says.1127 Tom Collins, from Gateshead, writes: "In Gateshead our Council Tax has been frozen, which I must admit we hadn't necessarily been expecting. If the Government could now do something about the increasingly ridiculous fuel prices then that would make a significant difference to our family."
Have Your Say
1125 Humpty, from Merseyside, writes: "Wasn't THAT long ago fuel prices breached the £1 per litre, it's now approx £1.40 a litre. Add to that the knock on affect on goods, and 20% vat - how are the average people supposed to live?"
Have Your Say
1124 Freyr Mervick tweets: "Well it's #budget day today! I trust George Osborne and @Conservatives to produce the Budget we need to keep seeing us through! #bbcbudget" 1121 Lewis Brown tweets: "As a student I don't need to watch the budget they can't make it any worse for us. #BBCBudget" 1118The latest official line on what's going to be in the Budget from the PM's official spokesman - apparently it will set out the government's plans to reform and rebalance the nation's economy and help families with the cost of living. A bit non-specific, admittedly, but this close to the Budget it's not surprising.1116The BBC's Ben Wright says David Cameron might have departed for the Commons but his chancellor is still at No 11 Downing Street, waiting to step out into the sunshine for the customary shot of him holding aloft his famous red box - although as mentioned earlier, it will be a new one this year as the iconic "Gladstone box", made c1860, is a little fragile these days and has been retired.​1115​Conservative MP Michael Fallon, chairman of the Treasury Select Committee wants more help for business and young people. The BBC's Laura Kuenssberg asks if there will be a predicted cut in corporation tax - he says he has no idea what's in the Budget. Simon Hughes, the Lib Dems' deputy leader, denies they are "hiding things" and says the final decisions on the Budget can come in the last 24 hours. He says "external pressures" have pushed up the cost of fuel and must be addressed. He's also expecting the rise in personal tax allowance. 1111 The BBC's Laura Kuenssberg tweets: "Lord Lamont tells me govt s can t make growth happen on their own - but says there is no chance there will be any sign of a plan B" 1107An hour to go until prime minister's questions - a quick recap of what's expected in the Budget announcement: The chancellor is widely predicted to raise personal tax allowances, do something to help first-time buyers in England and do something to address fuel prices. He will also tell MPs whether borrowing figures will come in at under the predicted £148.5bn and whether the growth forecast - currently 2.1% for 2011 - will be revised down. 1103 Tim Carpenter tweets: "If NI is merged with Income Tax, we deserve an admission it was a colossal fraud upon the public, who got instead a Ponzi Scheme #BBCBudget" 1102 Sim, from Bristol, writes: "After being made redundant from the public sector 6 months ago, I am now facing the prospect of having to leave my job in the private sector because my commuting expenses are crippling me. This month we were nearly faced with the choice of either pay for the mortgage, feed my three kids or put fuel in the tank."
Have Your Say
1059George Osborne will know his history well enough to know that a Budget hailed on the day can turn into one condemned long after. Read Nick Robinson's blog 1054 Claire, from Shepperton, writes: "The Council Tax for our area has increased by over 10%, which is obviously a contradiction to the earlier comment that the government say they have frozen or reduced Council Tax. Please, please, please give the working class a break."
Have Your Say
1052David Cameron has left No 10 as Westminster gears up for the main event. The BBC's Laura Kuenssberg says that the rumours doing the rounds are that the chancellor will go further on fuel than simply cancelling the planned rise of 1p a litre above inflation in fuel duty and may do something more long-term.1049 Unimpressed_UK, from Yorkshire, writes: "Although I am currently working, I do not know how long that will continue. There has to come a point at which it will be uneconomical for me to travel to work. Food is costing more, essential travel to work is costing more."
Have Your Say
1048What on earth can the chancellor do to promote growth - to encourage more investment by companies, to stimulate exports - if he has no money to give away? Read BBC business editor Robert Peston's blog for analysis.1044 Jonny Tench tweets: "I find it astounding that protesters outside the h of p already waiting with bated breath before they've heard the budget. #BBCBudget" 1033The BBC's Nick Higham finds himself at a service station on the M25 for the day - looking for people's reactions to any fuel price announcements. Florist Jane Pugh tells him her business has to absorb the high cost of fuel, rather than pass it on to customers, or she'll end up with no business to run. She's having to hire bigger vans to fit the flowers in, and doing fewer journeys.1029David Cameron is due to leave No 10 any minute now - he's got prime minister's questions at 1200 GMT, ahead of the Budget at 1230. All eyes are usually on the PM and opposition leader on Wednesdays but today it'll be the chancellor and his opposite number in the spotlight. 1028Regardless of the Budget, we've already got some big tax rises on the way. Before last year's general election, Labour had planned £9.3bn of net tax rises and benefit cuts to come into effect this April, with a further £14bn pencilled in for 2012-13. The coalition has opted to keep some of these, ditch others and introduce a few of its own. And of course VAT rose to 20% in January. 1021Labour's Pat McFadden says the government is lacking a "real vision" for the economy outside the M25 and doesn't understand the pressures on people in the Midlands and the North. Protesters are also preparing for the Budget outside the Houses of Parliament - calling for a crackdown on "fat cats".1017Former Conservative chancellor Lord Lamont is talking to the BBC's Laura Kuenssberg. He says the chancellor always reads the newspapers first and picks through the rumours from the accurate leaks - he says he will get "last-minute nerves" about how the Budget will go down. Lord Lamont also says it's a pity so much is leaked these days - and suggests it started under Gordon Brown. 1014 Paul Boland, from Banknock, writes: "I'm being made redundant in 3 months time, so about to join the millions of unemployed if I don't get a job before then. All my pay goes to bills and debt and I have zero left over to do anything other than go to work and sit in the house. The economy ain't going to grow if people have no money to spend on extra goods. 20% VAT, increasing fuel costs has eaten away my hard earned money that all I do is work (for the moment) and sleep."
Have Your Say
1012The British Bankers' Association says the number of mortgages approved went up in February, following a dip over the winter. But the modest rise takes approvals back to the levels of last October and is still lower than a year ago. Approvals totalled 29,923 in February, up from 29,159 the month before. 1011 Some good news for taxpayers - council tax is to be frozen or reduced by every council in England this year, says the government.1008 RandomUKhuman tweets: "Can't wait for the first "I will take no lessons from..." #pmqs #bbcbudget" 1006George Osborne is, unsurprisingly, being coy about what's in the Budget. Stepping out into the sunshine he tells journalists: "It's a good day to deliver the Budget, but you will have to wait until 1230 to find out what is in it." 1005It's a big day for Labour too. Labour leader Ed Miliband is already out and about and says the Budget will be a test of Mr Osborne's deficit-cutting strategy - which his party believes is going "too far, too fast". 1002 Matt Baller, from Warwickshire, writes: "I'm no economist, but I fail to understand the logic in changing the tax threshold; surely this will deepen the black hole we're faced with already? Wouldn't it have made more sense to increase income tax, and reduce fuel duty?"
Have Your Say
0951What are the newspapers saying about the Budget? The Telegraph's Philip Aldrick says the Budget is George Osborne's chance to move away from his image as brutal cost cutter and reveal his "reformist self" . Meanwhile the Guardian's Tom Clark says it is time to switch attention from the gap between the poor and middle-income earners - and look instead at the "greater gulf" between the rich, and the rest. 0949 BBC business editor Robert Peston tweets: "The budget background is UK's insipid recovery from the 2008-9 great recession. What can the Chancellor do to boost growth? #bbcbudget" 0941Ahead of the Budget there is always much speculation about what the chancellor's going to announce. The scope for pulling rabbits out of hats seems rather limited, but he is expected to raise personal tax allowances, do something to help motorists - probably cancelling a planned rise in fuel duty - and try to help business. BBC political editor Nick Robinson says this could mean announcements on deregulation, changes to the planning system and incentives to councils to allow more home building. 0939 Karl Webster tweets: "Big #budget day today. Here's hoping Osborne will reduce, not just freeze #APD. We all need a holiday after this year!" 0937George Osborne is at Downing Street briefing his cabinet colleagues ahead of his Budget at 1230 GMT. He's carrying a new Budget box - the famous "Gladstone box" used to carry chancellors' speeches for over a century is being retired. He's not the first chancellor to try out a new version though - Gordon Brown used a new one, as did James Callaghan in 1965.
0930Hello and welcome to our live coverage of the Budget. We'll be bringing you the latest news and commentary throughout the day. The sun's shining in London but the economic forecast remains uncertain - George Osborne will want to deliver a sense of optimism, but has he got much room for manoeuvre?
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