Chancellor George Osborne today gave a helping hand to motorists and the lower paid in a budget he said would boost “growth and jobs”.
To placate drivers facing record pump prices he cut the price of fuel by 1p per litre from 6pm tonight and announced a Fair Fuel Stabiliser to help keep costs down in future - to be funded by an increased levy on oil and gas production.
He also confirmed plans to raise the personal tax allowance by a further £630, to £8,105, a real increase of £48 extra per year, or £126 in cash terms.
And he claimed that together with this year’s rise, it would mean a total of £326 extra money each year for “those working hard to pay for their family’s needs”.
But he announced a cut in growth forecasts amid continuing bad economic news.
Mr Osborne’s second budget was greeted by cheers on the coalition benches but was damned by Labour leader Ed Miliband,
He said: “It is the same old Tories. It is hurting but it isn’t working”
Mr Osborne admitted that the recovery would be more sluggish than expected and the deficit take longer than previously planned to pay off.
The Office for Budget Responsibility slashed its growth forecast for this year from 2.1% to just 1.7%, although Mr Osborne said that it would pick up in future years.
At the same time borrowing over the next five years will be a total of £47 billion higher than previously predicted.
The OBR is now expecting a deficit of £122 billion next year, compared to the £117 billion previously forecast, while by 2015-16 it will still be £29 billion as against the £18 billion it had been thought.
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