AS2013: The round-up
The Office of Budget Responsibility has revised this year’s growth forecast for the UK from 0.6% to 1.4%, next year from 1.8% to 2.4%, and for the next four years; 2.2%, 2.6%, 2.7%, 2.7%.
Unemployment is now predicted to fall from 7.6% this year to 7% in 2015 and 5.6% in 2018.
Osborne described the UK’s improved outlook as a “job-rich recovery for all”.
But he warned that with the deficit and debt still at unsustainable levels deviating from that plan now would be the biggest risk to recovery.
The government has pledged to deliver “sound public finances” by borrowing £73bn less than it had originally planned.
A review of the state pension age, a cap on welfare and a review of the current fiscal policy framework are all plans to ensure that debt continues to fall as a percentage of GDP including using surpluses in good years for this purpose.
Osborne said the pension age has to keep pace with life expectancy and people should spend no longer than a third of their adult life in retirement.
The government is increasing the pensionable age to 68 in the mid 2030s and 69 in the late 2040s.
To help business grow and create jobs and to provide help for the high street the government is introducing a cap on the Retail Prices Index increase in business rates in England to 2% in 2014-15.
Osborne has launched a £1,000 business rates discount to help the high street while doubling the Small Business Rate Relief for a further 12 months from 1 April 2014 to help 540,000 firms.
The government is making it cheaper for businesses to employ young people by abolishing National Insurance contributions for under-21s earning below £813 per week.
And it is introducing a new tax relief for shale gas and support for the creative industries.
The start-up loans scheme will be expanded and is predicted to serve 50,000 extra people.
The government’s tax avoidance measures are predicted to raise £9bn over the next five years.
A capital gains tax on future gains for foreign owners of residential property in UK will begin in April 2015.
The bank levy has been raised from 0.13% to 0.156% from January 2014 which is projected to raise £2.7bn next year and £2.9bn in 2015/16.
To help families with the cost of living Osborne is freezing fuel duty for the remainder of this parliament, introducing the married couples transferable tax allowance and introducing reforms to save the average energy bill payer £50. Meanwhile free school meals are to be made available to all children in reception classes.