Budget 2021 latest news: Rishi Sunak insists 'our plan is working' as he cuts taxes and turns on spending taps

• Budget 2021 summary: key changes and highlights at a glance

• Rishi Sunak's big spending Budget loads on highest tax burden in 70 years

• Sunak halves business rates for retail and hospitality in high street boost - live updates

• Philip Johnston: There's nothing virtuous about wasting our money

• Sunak starts building for life after Covid

• Tom Harris: This Brownite Budget left Labour with little to complain about

• Rosa Prince: How can you have a Budget without a trade-off?

Rishi Sunak has vowed to slash taxes before the next election, despite announcing new spending that put Britain on course for its biggest tax burden since the 1950s.

Every Whitehall department will receive a "real terms rise in overall spending" as part of the Spending Review, the Chancellor said, amounting to £150billion over this Parliament. He also announced a reduction to the Universal Credit taper, benefiting two million of the lowest-paid workers, an overhaul of alcohol duties and passenger air duty relief for those flying within the UK.

While the Budget began "the work of preparing for a new economy post-Covid," he noted the country was at a crossroads.

"Do we want to live in a country where the response to every question is 'what is the Government going to do about it?' Where every time prices rise, every time a company gets in trouble, every time some new challenge emerges, the answer is always 'the taxpayer must pay'," he asked. "Or do we choose to recognise that government has limits? That government should have limits?"

Mr Sunak went on: "My goal is to reduce taxes. By the end of this Parliament, I want taxes to be going down not up. I want this to be a society that rewards energy, ingenuity and inventiveness. A society that rewards work."

​​Follow the latest updates below.

02:44 PM

Education spending 'hardly a bonanza', says IFS director

Spending increases in education are "hardly a bonanza" in the face of inequality brought about by the pandemic, the director of the Institute for Fiscal Studies has said.

Paul Johnson told the BBC: "Returning spending to where it was in 2010 is not an enormous amount to boast about.

"To have no growth over 15 years in such an important part of public services is unprecedented, so it's hardly a bonanza in the education system.

"I think in terms of schools, there's been so much good news about the impact of the pandemic in general - it hasn't, in general, hit younger people in the end more than older people, it hasn't actually even particularly hit lower-paid people more than better-paid people in the end, but it has really hit less well off children much more than it has better off children.

"I think spending additional money well to fix that particular increase in inequality, I would have thought, would be one of the biggest priorities of the Government."

02:40 PM

Freeports simply 'moving location of economic activity': OBR

Freeports might be heralded by Rishi Sunak and his Brexiteer cohort as the kind of red-tape-cutting boost to the economy leaving the EU presents.

But the OBR has a rather different take...

02:34 PM

Doubles on 007: How Rishi's alcohol duty shift cuts the cost of a Martini

The Treasury has released a handy graphic that shows what the effect of today's tax changes will be on the prices of different drinks, Tony Diver reports.

Here are the headline changes from the Chancellor's new policy of "the stronger the drink, the higher the rate".

• A pint of Stella Artois in a pub will go down by 3p in tax to £3.80, thanks to a cut in the price of draught beer.

• A pint of Magners will decrease by 2p, but a bottle of 7.5% ABV of Frosty Jack's cider from a supermarket will increase by 45p, to £3.70 per bottle.

• A bottle of JP Chenet Sauvignon Blanc will fall by 12p to £9 in shops, but a stronger bottle of 13.5% Campo Viejo Rioja will cost 47p more, at £16.

• Thanks to the tax cut for sparkling wine, a bottle of Canti Prosecco will cost £8.50, down 87p, while Martini Asti will cost £1.07 less.

• Aperol will become 26p less expensive in shops, Malibu will fall by 50p, but Famous Grouse whisky and Smirnoff vodka will stay the same price.

02:32 PM

Highest tax rises in a year for almost three decades

Rishi Sunak has raised taxes this year by the highest amount in a single year for 28 years,writes Lucy Fisher.

The Office for Budget Responsibility stated: "Taking his March and October Budgets together, the Chancellor has raised taxes by more this year than in any single year since Norman Lamont and Ken Clarke’s two 1993 Budgets in the aftermath of Black Wednesday."

The tax burden will rise from 33.5 per cent of GDP before the pandemic to 36.2 per cent of GDP by 2026-27, its highest since the early 1950s.

02:29 PM

Buried in the Budget: Social care precept to push up council tax by £6bn

As is usual on Budget days, the devil is in the detail - and one fairly sizeable demon seems to be a £6bn council tax hike.

Going through the OBR document after Rishi Sunak's speech shows that on top of the six per cent increase this year, by 2026-27 "we expect receipts to be £12.1bn (33 per cent) above their 2019-20 level".

The document adds: "This largely reflects policy measures allowing councils to increase the adult social care precept on council tax bills, over and above the almost two per cent increases in core rates included in our baseline forecasts."

02:24 PM

Break out the bolly: 'Tax changes save 64p a bottle'

Commentators can't work out whether Rishi Sunak is trying to get people to make much of his plan to level duties between sparkling wine and its unfizzy friends.

Sam Freedman, a former policy adviser for Michael Gove, tweeted: "Did Sunak just do that whole spiel about sparkling wines so it would be called the champagne budget in the papers?"

However the Mirror's Mikey Smith takes a different view:

He adds: "My very back of a fag packet maths suggests about 64p less tax on a bottle of Bollinger."

02:10 PM

'Clear blue water' between current tax burden and 'any time in the past'

After today's Budget, it seems Rishi Sunak is still too committed to jam today to turn off the taps, despite stressing that there are "limits" to Government (aka taxpayer) spending.

The Chancellor has put Britain on course for its biggest tax burden since the 1950s in a heavy spending Budget that delivered £150bn of extra commitments.

As the Institute of Fiscal Studies points out, there is now "getting to be clear blue water between now and any time in the past".

02:00 PM

Business rates reform 'falls far short', says West End representative

The head of the association representing London's West End has hit out at Rishi Sunak's business rate reforms, saying it "simply doesn't meet the Government's manifesto commitment".

Jace Tyrrell, chief executive of New West End Company, said while it was "encouraging" to see the Chancellor "finally act", rates were still too high overall and the relief on offer was just for a year.

"Reducing the time between revaluations to three years is welcome, as is the short term relief for investment in improvements and sustainability, but this falls far short of a fundamental review," Mr Tyrrell added.

"This simply doesn't meet the Government's manifesto commitment to reduce the burden of business rates on business. We hope that this is not the extent of the fundamental review."

01:55 PM

Online sales tax still under consideration - despite no Budget mention

An online sales tax is still under consideration, despite no announcement in the Budget today, the Treasury has confirmed.

A spokesman for the Exchequer said an update could be expected in “following weeks and months”, writes Lucy Fisher, deputy political editor.

It follows clamour from bricks and mortar retailers for a more level playing field with online e-commerce giants like Amazon.

01:51 PM

Budget not 'bold enough' for UK's needs, says CBI boss

The head of the Confederation of British Industry has given Rishi Sunak's Budget a lukewarm welcome, saying it is not "bold enough" for the current needs.

Tony Danker - who was less than enamoured with the Government's criticism of industry during conference season, says while Rishi Sunak showed a "a genuine willingness to listen to business" what was announced today does not go far enough "to deliver the high investment, high productivity economy the Government seeks".

The Chancellor made "real strides" on business rates but he "missed the opportunity to truly reform a business rates system that diminishes Britain’s high streets and factories".

Mr Danker added: "This Budget alone won’t seize the moment and transform the UK economy for a post-Brexit post-Covid world. Businesses remain in a high tax, low productivity economy with concerns about inflation."

01:47 PM

Forecasts for household income are 'actually awful', says IFS boss

Rishi Sunak might have made much of glowing OBR forecasts for growth and improved estimates for Covid economic scarring, but the Institute for Fiscal Studies has raised a note of warning about the trajectory for disposable income.

Paul Johnson, the IFS' director has said that "deep in the bowels" of the OBR document are "very disappointing" figures, with the expectation for household growth for the next five years looking "pretty stagnant" at 0.8 per cent each year.

"This is actually awful", he adds.

01:37 PM

Inflation could be 'defining issue' for many years, warns Ian Blackford

Inflation may well be "the defining issue of many budgets to come", Ian Blackford has warned.

Responding to the Chancellor's speech, the SNP's Westminster leader told the Commons that with current estimates suggesting inflation could soon hit five per cent "mortgage holders are rightly fearful" about interest rates.

"The Chancellor seems to think that all of this is merely transitory," he added. "But complacency on this issue is simply not an issue. History shows how quickly an inflationary spiral can get out of control. It is worth remembering that in 1980, inflation hit 18 per cent. None of us can afford to go back to that place."

Mr Blackford then launches into his usual attack on Brexit, saying that Covid cannot "mask" the impact leaving the EU is having on the economy.

01:24 PM

Rishi Sunak should withdraw 'disgraceful' air passenger duty relief, says Ian Blackford

Ian Blackford says he "thinks better of the Chancellor" than Boris Johnson who "makes things up as he goes along".

But the SNP's Westminster leader says that he is wrong about cutting air passenger duty between Inverness and the Highlands "because there is no air passenger duty - one would have thought if he was going to make announcements he would have checked his facts first".

But, with Cop26 around the corner, he says there is a problem more fundamentally with Rishi Sunak cutting duty on domestic flights.

"CO2 emissions per mile are much higher on domestic flights than long-haul flights, so what on earth are we doing? Where are we when we are saying when we take our climate obligations seriously?... Chancellor, this is a disgrace and shows quite frankly that this is not a Government that understands the climate emergency we all face."

Mr Blackford tells Mr Sunak to withdraw his policy.

01:14 PM

Chancellor must 'get very good at saying no', says Treasury committee chairman

Mel Stride has urged the Chancellor to "get very good at saying no to ministers".

The NHS take of total public expenditure has risen from 32 per cent to 42 per cent over the last 10 years, the Treasury committee chairman notes.

"He must get very good at saying no to ministers when is necessary to do so and to tell them to go back to their departments and work harder," the former Treasury minister adds - the rest of his sentence is drowned out by MPs saying "hear hear".

01:11 PM

Mel Stride warns about UK's vulnerability to interest rate rises

Mel Stride has warned that the UK is very vulnerable to interest rate rises given how high the public debt is.

The Treasury committee chairman said: "I think my right hon friend gave the example of a one per cent increase would lead to £23bn increase in debt serving cost - to put that into perspective, that would wipe out the entire value of the corporation tax increases and the threshold freezes for income tax that my right hon friend announced at the last Budget.

"That would be gone in one gulp - so we do have to be very careful about this vulnerability we have., Though we have low interest rates, and interest rates might move up in baby steps, it is applied to a very, very large level of debt indeed."

01:07 PM

Rishi Sunak's prudence will be scrutinised, Treasury committee chairman warns

Mel Stride, chairman of the Treasury select committee, says he "broadly" welcomes the Budget.

"It's fair to say my right hon. friend did a pretty remarkable job [during the pandemic] - he now has an even tougher job," the former minister adds. "The background is extremely tough."

The deficit might be falling but "it is nonetheless very highly elevated", while debt is at a record level and supply chain bottlenecks are causing "headwinds".

But there are reasons to be cheerful, Mr Stride says, pointing to the improved OBR forecasts on growth and scarring, which has been achieved by "the hard work" of Rishi Sunak.

"It has left him with some breathing space... the big test as we unpack this Budget is what has he done with this headroom? Not surprisingly, he has spent quite a lot of it."

The committee will look "very closely" at how prudent the Chancellor has been.

01:00 PM

Workers on UC 'still face higher taxes than Prime Minister'

Rachel Reeves has taken aim at Rishi Sunak's decision to reduce the Universal Credit taper rate.

While welcoming the move in general, the shadow chancellor says the system is "so out of whack that even after this reduction, working people on Universal Credit still face a higher marginal tax rate than the Prime Minister", the Labour frontbencher says.

Meanwhile the Budget "does absolutely nothing" for families who don't receive benefits, on an average wage, but are facing a cost-of-living crisis amid rising bills.

She says the VAT cut to energy bills would be possible because we are out of the European Union - eliciting cheers from Tory benches, but ploughs on, saying "working people are left out in the cold".

12:46 PM

'Arrogant' Rishi Sunak is 'living in parallel universe', says Rachel Reeves

Rachel Reeves, responding instead of Sir Keir Starmer, says Rishi Sunak is "living in a parallel universe", noting that people sipping champagne on short-haul flights will cheer it.

The shadow chancellor said he has shown "arrogance" in having taken £6bn "out of the pockets of the poorest" but giving them £2bn to compensate.

She notes that the Conservatives were in charge "during this lost decade" that has left Rishi Sunak investing in services.

"And who is going to pay for it?" she asks, noting it is not international giants like Amazon, banks or property speculators. "Instead the Chancellor is loading the burden on working people."

12:43 PM

Rishi Sunak: This Budget helps with cost of living

Rishi Sunak says his changes to Universal Credit are "a £2bn tax cut for the lowest paid workers in the country".

He adds: "It supports working families. It helps with the cost of living. And it rewards work."

The Chancellor concludes his Budget statement by reeling off a list of announcements and economic forecasts.

"This Budget helps with the cost of living. This Budget levels up to a higher-wage, higher-skill, higher-productivity economy. This Budget builds a stronger economy for the British people, and I commend it to the House," he says.

12:41 PM

Rishi Sunak announces 8pc reduction to Universal Credit taper

Rishi Sunak has drawn cheers by announcing a cut to the Universal Credit taper that will take place "within weeks".

The Chancellor said that the current level represented "a hidden tax on work" for the lowest paid, as he announecd the 63p rate would be cut to 55p - a reduction of eight per cent "to make sure work pays, and help some of the lowest income families in the country keep more of their hard-earned money."

"Let us be in no doubt: this is a tax on work, and a high rate of tax at that," he said.

"Changes like this normally take effect at the start of the new tax year in April. But I want to help people right now," he said, confirming it will be brought in no later than December 1.

12:38 PM

Government 'should have limits', says Rishi Sunak

The Chancellor then returns to the economy, saying that while he had to "put aside questions of ideology and orthodoxy" during the pandemic, that must come to an end.

"Taxes are rising to their highest level as a percentage of GDP since the early 1950s," he tells a hushed room. "I don't like it, but I cannot apologise for it - it's the result of the unprecedented crisis we faced and the extraordinary action we took in response.

"But now, we have a choice. Do we want to live in a country where the response to every question is: what is the government going to do about it? Where every time prices rise, every time a company gets in trouble, every time some new challenge emerges, the answer is always: the taxpayer must pay?

"Or do we choose to recognise that Government has limits. That Government should have limits. If this seems a controversial statement to make, then I'm all the more glad for saying it, because that means it needed saying, and it is what we believe."

12:35 PM

Pay rises for public sector workers and lowest paid confirmed

Rishi Sunak then confirms some of the announcements he has already trailed in recent days - the end to the public sector pay freeze and the rise to the national living wage.

The 6.6 per cent rise "will benefit over two million of the lowest paid workers in the country" and is "broadly consistent with previous increases and keeps us on track for our target of two thirds of median earnings by 2024", he tells MPs.

This will contribute towards building a "high-wage, high-skill, high-productivity economy of the future," he adds.

12:33 PM

Rishi Sunak scraps planned increase in duty on spirits

Turning to hospitality support, Rishi Sunak announces a new Draught Relief, which will introduce a lower rate of duty on draught beer and cider. served from containers of more than 40 litres.

"That's the biggest cut to cider duty since 1923. The biggest cut to fruit ciders in a generation. The biggest cut to beer duty for 50 years," the Chancellor says, describing the move as "a long-term investment in British pubs of £100m a year, and a permanent cut in the cost of a pint by 3p."

These changes won't come in until February 2023, but to "help the hospitality industry right now" Mr Sunak announces the planned increase in duty on spirits like Scotch whisky, wine, cider and beer, will "from midnight tonight, be cancelled".

He says this is work £3bn.

12:29 PM

Champagne capitalist: Rishi Sunak announces sweeping changes to alcohol duties

Rishi Sunak is also cheered as he turns to alcohol duties, which he says he is able to "radically simplify" thanks to Brexit.

The number of rates will be "slashed" from 15 to six "designed around a common-sense principle: the stronger the drink, the higher the rate", the Chancellor says.

Stronger red wines, fortified wines, or high-strength white ciders will see a "small increase", which Mr Sunak said would help address public health and problem drinking.

But he adds: "Many lower alcohol drinks are currently overtaxed - and have been for many decades. Rose, fruit ciders, liqueurs, lower strength beers and wines - today's changes mean they will pay less."

He also announces proposals for a new small producer relief, extending it to small cidermakers and other producers making alcoholic drinks of less than 8.5 per cent.

And, reflecting the fact that drinking sparkling wine is "no longer the preserve of wealthy elites", he announces the end to the "the irrational duty premium of 28 per cent".

12:25 PM

Business rates remain - but with some reforms

The business rates review is being published today, Rishi Sunak announces, saying he believes that "reckless, unfunded promises to abolish a tax which raises £25bn every year are completely irresponsible".

The Chancellor claims it would be "wrong" to seek to plug that gap elsewhere "so we will retain business rates, but with key reforms to ease the burden and create stronger high streets".

Revaluations will take place every three years from 2023, while there will be a new investment relief introduced to encourage businesses to adopt green technologies like solar panels.

On top of that, there will be a new business rates improvement relief introduced so that any business that makes property improvements will pay no more for 12 months.

12:21 PM

Air passenger duty lowered for flights within UK

Rishi Sunak has also announced a lower rate of air passenger duty for people flying between England, Scotland, Wales and Northern Ireland from April 2023.

"This will help the cost of living, with nine million passengers seeing their duty cut by half," he says.

"It will bring people together across the UK. And because they tend to have a greater proportion of domestic passengers, it's a boost to regional airports like Aberdeen, Belfast, Inverness and Southampton," he adds.

Regional airports will also receive extended financial support for a further six months.

However the Chancellor also announces a new "ultra long haul band" in Air Passenger Duty, covering flights of more than 5,500 miles.

"Less than five per cent of passengers will pay more; but those who fly furthest will pay the most," he tells MPs.

12:19 PM

MPs cheer Sunak's shipping tax reform

Rishi Sunak gets one of the biggest cheers so far as he announces a change to "one of our smallest taxes, but a tax which plays an important role in one of our pre-eminent industries: shipping".

Having left the EU, "today we start reforming our Tonnage Tax regime to make it simpler and more competitive", he adds.

Previously Tonnage Tax was required to fly the flag of an EU state.

"But that doesn't make sense for an independent nation. So I can announce today that our Tonnage Tax will - for the first time ever - reward companies for adopting the UK's merchant shipping flag, the Red Ensign," he says, noting that Labour will be happy that there are red flags flying somewhere.

12:16 PM

Chancellor unveils numeracy programme

Rishi Sunak says he wants to tackle "a tragic fact" - that millions of adults in England have "numeracy skills lower than those expected of a nine-year-old".

He cites charity National Numeracy as estimating that this costs individuals up t o£1,600 a year in lost earnings., saying people with poor numeracy skills are more than twice as likely to be unemployed as their peers.

As a result, he unveils a UK-wide numeracy programme called Multiply, which will receive £560m to "improve basic maths skills and and help to change people's lives".

12:13 PM

Rishi Sunak: Government will invest rather than 'retrench' after Covid

Rishi Sunak tells MPs that "over the long-term the only way to pay for higher spending is economic growth".

He adds: "If we want to see higher growth, we've got to tackle the problem that's been holding this country back for far too long: our uneven economic geography."

But the choice facing the Government is "to retrench - or to invest", he adds. "This Government chooses to invest."

On that note, he highlights £21bn investment in roads and £46bn on railways.

Ahead of the Integrated Rail Plan he announces a £5.7bn fund for "London-style transport settlements in Greater Manchester, Liverpool City Region, the Tees Valley, South Yorkshire, West Yorkshire, the West Midlands and the West of England.

"The Prime Minister promised an infrastructure revolution, and this Budget delivers an infrastructure revolution," he says.

12:08 PM

Government is 'levelling up the opposition front bench', jokes Rishi Sunak

Rishi Sunak receives cheers as he tells the Commons he is so committed to levelling up "we are even levelling up the opposition front bench".

The Chancellor revealed the levelling up fund included projects for Ashton under Lyne - Angela Rayner's seat - among others.

In allocating the first round of bids from the Levelling Up Fund, he confirmed there would be£1.7bn to invest in "the infrastructure of everyday life in over 100 local areas" including Aberdeen, Bury, Burnley, Lewes, Clwyd South "and not one, not two, but three successful projects for the great city of Stoke-on-Trent."

12:06 PM

Rishi Sunak unveils support for young families and school children

Rishi Sunak confirms a new £300m fund for young families, tailored services for perinatal mental health and a new network of family hubs around the country.

The Chancellor also unveils a plan to "pay providers more" for childcare, with an extra £170m support for the sector and £150m "to support training and development for the entire early years workforce".

A further £200m will be ploughed into the Supporting Families programme, with an annual £200m holiday activity and food programme.

"We know that the pandemic caused significant disruption to children's learning," he told the Commons. "We've already announced £3.1bn to help education recovery. Today, as promised by the Prime Minister and Education Secretary, we will go further with just under £2bn of new funding to help schools and colleges," he added.

12:02 PM

Rishi Sunak confirms brownfield fund as he vows to tackle housing

Rishi Sunak announces a £11.5bn fund to build up to 180,000 new affordable homes, describing it as "the largest cash investment in a decade, 20 per cent more than the previous programme".

He also confirms the £1.8bn brownfield fund, which will help "unlock 1 million new homes".

The Chancellor also confirmed £5bn to help remove unsafe cladding, which will be partly funded by the Residential Property Developers Tax, which will be levied on developers with profits more than £25m at a rate of four per cent.

He also unveiled an annual £640m fund for rough sleeping and homelessness.

11:59 AM

Rishi Sunak announces new local government grant

Healthcare spending will increase by more than £44bn by the end of this Parliament, Rishi Sunak has said.

It will have risen to £177bn, with record investment in health R&D, 40 new hospitals. 70 hospital upgrades, more operating theatres and 100 community diagnostic centres as well as more NHS staff.

" As well as funding to deliver the Prime Minister's historic reforms to social care we're providing local government with new grant funding over the next three years of £4.8bn,the largest increase in core funding for over a decade."

11:56 AM

Chancellor: Overseas aid budget to be restored before end of Parliament

Rishi Sunak says "there will be a real terms rise in overall spending for every single department" after the Government stayed within its fiscal rules "with a margin to protect ourselves against economic risks".

Although noting that "just a one percentage point increase in inflation and interest rates would cost us around £23bn", the Chancellor said the country was on track to restore the 0.7 per cent ODA by 2024-25 "before the end of the Parliament.

11:51 AM

Borrowing to fall every year, says Rishi Sunak

The UK's borrowing as a percentage of GDP is forecast to fall "in every single year" the OBR has forecast, Rishi Sunak tells the Commons.

"From 7.9 per cent this year to 3.3 per cent next year, then 2.4, 1.7, 1.7 and 1.5 per cent in the following years.," he adds.

"Borrowing down, debt down, proving once again it is the Conservatives – and only the Conservatives - who can be trusted with taxpayer’s money."

11:49 AM

Chancellor sets out new fiscal rules

Rishi Sunak has unveiled a new "Charter for Budget Responsibility" with two new fiscal rules "which will keep this Government on the path of discipline and responsibility".

The new rules are that underlying public sector net debt, excluding the impact of the Bank of England, must, as a percentage of GDP, be falling.

The second is that "in normal times" the state should only borrow to invest in our future growth and prosperity.

"Everyday spending must be paid for through taxation," the Chancellor said.

"Both rules must be met by the third year of every forecast period, giving us the flexibility to respond to crises while credibly keeping the public finances under control. These rules are supplemented by targets to spend up to three per cent of GDP on capital investment.

11:48 AM

Covid 'economic scarring' revised downwards, says Rishi Sunak

The Government has been "more successful than previously feared in preventing the long-term economic damage of Covid", Rishi Sunak has said.

"The OBR have today revised down their scarring assumption from three per cent to two per cent," he told MPs.

The body has branded his plan for jobs "remarkably successful", the Chancellor adds. "Today’s forecasts confirm beyond doubt - our Plan for Jobs is working."

11:46 AM

OBR revises growth forecasts to 6.5 per cent for this year

The Office for Budget Responsibility is now forecasting the economy will return to its pre-Covid level at the turn of the year –"earlier than they thought in March", Rishi Sunak has said.

Growth this year is revised up from four per cent to 6.5 per cent, with the economy growing by six per cent in 2022, and 2.1 per cent, 1.3 per cent and 1.6 per cent over the next three years.

"In July last year, at the height of the pandemic, unemployment was expected to peak at 12 per cent, but today the OBR expect unemployment to peak at 5.2 per cent," the Chancellor said. "That means over 2 million fewer people out of work than previously feared."

11:43 AM

Chancellor announces driver shortage measures

The Chancellor announces a couple of small measures to address the driver shortage - on top of those already announced.

The Transport Secretary will unveil "new funding to improve lorry park facilities", Rishi Sunak says.

"We’ve already suspended the HGV levy until August and I can do more today, extending it for a further year until 2023, and freezing Vehicle Excise Duty for heavy goods vehicles," he adds.

11:41 AM

Budget: Inflation to average four per cent over next year

Inflation will average four per cent over the next year, the Chancellor has said. It was 3.1 per cent in September.

"The majority of this rise in inflation can be explained by two global forces. First, as economies around the world reopen, demand for goods has increased more quickly than supply chains can meet," Rishi Sunak tells the Commons.

"The pressures caused by supply chains and energy prices will take months to ease. It would be irresponsible for anyone to pretend that we can solve this overnight.

"I am in regular communication with finance ministers around the world and it’s clear these are shared global problems, neither unique to the UK, nor possible for us to address on our own," he adds.

11:39 AM

Budget is 'foundation' of new age of optimism, says Rishi Sunak

Rishi Sunak admits "today’s Budget does not draw a line under Covid".

The Chancellor tells the Commons: "We have challenging months ahead, and let me encourage everyone eligible to get their booster jabs right away.

"But today’s Budget does begin the work of preparing for a new economy post Covid. The Prime Minister’s economy of higher wages, higher skills, and rising productivity.

"An economy fit for a new age of optimism, where the only limit to our potential is the effort we are prepared to put in and the sacrifices we are prepared to make," he adds.

"That is the stronger economy of the future. And this Budget is the foundation."

11:38 AM

Rishi Sunak draws cheers as he sets out Budget with 'stronger economy'

Rishi Sunak says he has "listened very carefully" to his telling off over the Budget pre-briefings.

But the Chancellor quickly pivots to his statement, kicking off with bombast.

"Employment is up. Investment is growing. Public services are improving. The public finances are stabilising. And wages are rising," he says to cheers from the Conservative benches.

"Today’s Budget delivers a stronger economy for the British people: Stronger growth, with the UK recovering faster than our major competitors. Stronger public finances, with our debt under control. Stronger employment, with fewer people out of work and more people in work."

11:36 AM

Deputy speaker wraps Chancellor's knuckles over pre-Budget briefing

Dame Eleanor Laing, the deputy speaker, is taking "the unusual step of saying a few words" before the Budget.

She says she shares the concerns of many MPs about the pre-briefing that has taken place in recent days.

It is "well-understood" that in prior years "elements" of the Budget has been pre-briefed, but it has been "rather different to what we have experienced this year," she says - to cheers, and calls for Rishi Sunak to resign.

"There shouldn't be shouts of resign," she says. "We are just talking about courtesy to this House."

However she expresses the "firm hope that we do not find ourselves" in the same position next year -joking that she is looking forward to the "remainder" of his announcements.

11:31 AM

PMQs: Boris Johnson rebuffs call to repay donations from 'climate denialists'

Zarah Sultana receives groans as she asks about Tory donations totalling £1.3m from "fossil fuel companies, interest groups and climate denialists".

She asks Boris Johnson to respond without "waffling or dodging the issue" as she calls on him to pay back the money.

The Prime Minsiter says all donations are registered in the normal way and returns to his earlier attack line about Labour's "paymasters GMB".

11:29 AM

PMQs: No need to deviate from Covid plan, says Boris Johnson

Ben Bradshaw says it is good to see "some" Conservative MPs wearing face masks, and asks whether Boris Johnson regrets lifting restrictions earlier this year given rates are "far, far higher" than other Western countries.

"If not, why are our figures so bad?" the Labour MP for Exeter asks.

The Prime Minister says data is being monitored carefully but there is nothing that warrants "deviating from the plan".

11:26 AM

PMQs: Conditions for triggering Article 16 'have already been met', says Boris Johnson

Sir Jeffrey Donaldson, the DUP leader, raises the Northern Ireland protocol.

Boris Johnson says the Government is "working hard to secure an agreement by negotiation, but we need to see real progress", because issues on the ground "haven't gone away".

Without "rapid" progress "the conditions for invoking Article 16 have already been met", he adds.

11:23 AM

PMQs: Boris Johnson challenged over famine in Afghanistan

Ian Blackford, the SNP's Westminster leader, asks Boris Johnson what the Government is doing to help those now facing a famine in Afghanistan.

The Prime Minister says aid has been doubled this year to the country but "what we can't do at the moment is write a completely blank cheque to the Taliban authorities", for fear it will "slip back" into a haven for terrorists and an "anarcho-state".

Mr Blackford says the situation is getting worse by the day and "this Government is washing its hands of the legacy it left behind".

Boris Johnson reiterates the success of the ongoing resettlement programme and the "pretty remarkable" Operation Pitting.

11:21 AM

Rachel Reeves to respond to Budget after Starmer tests positive for Covid

With Sir Keir Starmer testing positive for Covid-19, he has had to pull out of both PMQs and the Budget at the very last moment.

The Labour leader is understood to have got the positive result in a test conducted just before Prime Minister’s Questions, Ben Riley-Smith writes. One Labour source told The Daily Telegraph that Sir Keir’s positive test result dropped just moments before he headed into the Commons for PMQs.

Ed Miliband, the former Labour leader and shadow business secretary, was the first to cover for his boss as a result.

Rachel Reeves, the shadow chancellor, will deliver Labour’s response to the Budget - often dubbed the most difficult speech in the parliamentary calendar given the details of the Budget are closely kept.

11:18 AM

PMQs: Cop26 cannot be just a photo opportunity, says Ed Miliband

Ed Miliband claims it is "not just on aid that they look both ways", as he accuses the Prime Minister of having "undermined his own Cop26 presidency" on issues like the Australia trade deal and Cumbria coal mine.

Boris Johnson says he should "withdraw" comments about the global climate change investment, which is "absolutely rock solid".

Australia has made a "great" commitment on climate change, he adds, as have Indonesia and Russian President Putin.

He repeats it is "in the balance" whether Cop will succeed, however. Mr Miliband says the climate change is not a "photo opportunity", and must be taken seriously with more than "warm words".

11:14 AM

PMQs: Ed Miliband challenge Boris Johnson over foreign aid

Ed Miliband then turns to the aid budget, noting that the UK is the only G7 country to cut aid during the pandemic, saying it makes climate targets much harder.

Boris Johnson notes his dislike of partisanship "didn't last long", arguing that he had announced a "huge" commitment for the developing world to tackle climate change.

"We have not cut that, we are keeping that investment," he says. But Mr Miliband claims this is not true.

"It is one thing not to know what is in the Paris Agreement but it is another thing not to know what is in his own Budget," he says.

11:12 AM

PMQs: Boris Johnson told off for 'partisanship' on climate

Boris Johnson claims Labour has been overruled by "the paymasters" of union GMB as he shrugs off criticism of his work on climate.

The Prime Minister said plans meant "they would be confiscating people's cars and they would only be allowed one flight in 25 years".

But Ed Miliband says the country needs "statesmanship, not partisanship".

"He should not be trying to score party political points on such an important issue facing our country and our world," he says.

11:08 AM

PMQs: Boris Johnson told not to shift goalposts on Cop26 targets

Boris Johnson tells Ed Miliband that "of course" he recognises how far the world is from meeting targets - but stresses that work is happening.

"Every day countries are coming through with solid commitments," he insists. "Whether they are going to be enough - it is too early to say."

Mr Milband, who is standing in for Sir Keir Starmer, says it is easy to make promises for the future but "much harder to act now".

He tells the Prime Minister "not to shift the goalposts" in Cop26 and "keep the focus on 2030 and not 2050 and beyond".

11:06 AM

PMQs: 'Too early to say' if Cop26 commitments will be enough, says Boris Johnson

Ed Miliband begins by asking about global emissions ahead of Cop26.

Boris Johnson says he hopes Sir Keir Starmer "returns soon", before turning to the question, saying the climate summit is "unbelievably important".

Keeping below 1.5 degrees is "unbelievably important" and commitments made at Cop26 will be a key part of that, the Prime Minister says.

Whether it will be enough "is too early to say".

11:04 AM

PMQs: Sir Keir Starmer to miss Budget after testing positive for Covid

Boris Johnson has opened PMQs by saying Rishi Sunak's Budget will set out "a new age of optimism".

But the Speaker confirms that Sir Keir Starmer has tested positive for Covid and won;t be attending - with Ed Miliband stepping into the breach.

MPs jeer and cheer as he steps up.

10:59 AM

SNP MP bemoans redacted Budget briefing document

Rishi Sunak could face a telling off from the Speaker today over his approach towards pre-Budget briefings - but if Sir Lindsay Hoyle doesn't oblige, opposition MPs seem likely to.

10:57 AM

Tory mask-wearers 'still very much in minority'

The Commons Chamber is filling up ahead of PMQs and the Budget - but the Speaker's face mask rule-change appears to have had little impact on the Conservative benches.

While Sir Lindsay Hoyle's move to mask masks mandatory does not include MPs, Robert Jenrick this morning suggested it would not be fair to have a two-tier system.

However as Chi Onwurah, the Labour MP, notes, "Tory MP mask wearers [are] still very much in a minority".

10:49 AM

Boris Johnson heads into Parliament

10:46 AM

Philip Johnston: There’s nothing virtuous about the state recklessly wasting our money

About a year ago, Rishi Sunak joked that he would have to take Boris Johnson’s credit card away, so wedded was the Prime Minister to spending pledges, writes Philip Johnston.

He should have cut it up and buried it, judging by the profligacy on show on the eve of today’s Budget.

The Chancellor had sought to give the impression that he is the fiscal conservative who needs to rein in his Downing Street neighbour’s “urge to splurge”. Yet all the spending announcements have been pouring out of the Treasury, not No 10.

The magic money tree, so derided when it was wilting in Jeremy Corbyn’s back garden, is now being lovingly watered and mulched by Rishi and Boris.

Read more from Philip here.

10:31 AM

Rishi Sunak vows to deliver post-Brexit 'substantive reform of tax system'

Rishi Sunak told Cabinet ministers that his Budget and Spending Review "will deliver a stronger economy for the British people, promoting high skills, high productivity and higher wages".

Speaking ahead of his big announcement, the Chancellor told his colleagues that "strong public services, infrastructure innovation and skills, and support for working families were the three building blocks".

Levelling Up will be "the golden thread that runs through this Spending Review and Budget", he added - noting he would "take the opportunities leaving the EU has afforded us to deliver substantive reform of our tax system".

The Cabinet welcomed the Budget plans and spending review settlement and joined Boris Johnson "in emphasising the importance of delivering against our commitments and promises for people right across the UK", a Downing Street spokesman said.

10:20 AM

Fears are growing over longer-term inflation, admits former Treasury minister

A former Treasury minister has said the economy is "dramatically better" than had been forecast, but inflation has become more worrying.

Jesse Norman, who lost his job in last month's reshuffle, told Sky News he had helped to draft many of the proposals on taxes so he could not comment on them, but overall the aim was to stimulate growth while also "flagging a degree of fiscal responsibility".

"It will be very interesting to see what the balance will be.. the really interesting question will be what this does to support that growth story."

But he noted that inflation was "a serious matter", and there was "the beginning of a recognition" that it was longer-term than had originally been thought.

10:13 AM

Budget analysis: Tories anxiously awaiting council tax announcement

Hopes are high that Rishi Sunak will be able to lift the burden for taxpayers in today's Budget, with fuel duty expected to be frozen once again, alcohol duty lowered and potentially a VAT cut on energy bills.

But there could be a sting in the tail, writes Catherine Neilan.

Council tax has risen every year for the past 10 years under the Conservatives and it is likely the Chancellor will allow town halls to increase local levies once again, this time by up to 5pc, pushing the annual bill for the average band D property close to £2,000.

Town halls are likely to need extra cash to cover the cost of social care, with the vast majority of the levy announced earlier this year being earmarked for the NHS. But doing so will open Mr Sunak up to political heat from his own backbenchers, concerned that further tax rises in the coming years will undermine the Conservatives' chances of being re-elected.

10:04 AM

What the Budget will mean for house prices

Britain’s property market has been flying at 1,000 miles per hour since the housing market reopened, fired up in part by Chancellor Rishi Sunak’s stamp duty tax giveaway.

Now, Mr Sunak’s autumn Budget comes at a time of transition. The market is adjusting to the end of the stamp duty holiday. Prices have been underpinned by an extreme shortage of supply, but demand is cooling.

Meanwhile, high inflation means interest rate rises are imminent. The Centre for Economics and Business Research, a consultancy, has forecast a 2.4pc drop in house prices by the end of 2022 to account for rate rises.

How much could change for the housing market? Read our story in full here

09:56 AM

Inquest into Sir David Amess' death adjourned

Pausing the Budget coverage briefly to note that an inquest into the death of MP Sir David Amess, who was stabbed to death at a constituency surgery at a church in Leigh-on-Sea in Essex, has been opened and adjourned.

The hearing, which lasted less than five minutes, was told that the father-of-five died of "multiple stab wounds to the chest", with the number of wounds not stated.

Coroner's officer Paul Donaghy said that on October 15 Sir David was stabbed "during a meeting with one individual" and his death was declared at 1.13pm.

The inquest in Chelmsford was suspended pending the outcome of criminal proceedings, and will be reviewed on April 27.

09:52 AM

Budget analysis: Rishi Sunak may feel the heat if he doesn't tackle energy bills

Another area of potential political pressure that Rishi Sunak will no doubt be conscious of is rising bills, writes politics live editor Catherine Neilan.

The Chancellor has looked to address some of the components of the ongoing cost-of-living crisis by announcing a thaw of the public sector pay freeze and a 6.6 per cent increase to the national living wage. Reducing the Universal Credit taper will also go some way to lighten the load, if that comes through.

But Sir Keir Starmer, the Labour leader, this morning highlighted yet another hot topic: energy bills.

"The Budget must take the pressure off working people," he said. "With costs growing and inflation rising, Labour would cut VAT on domestic energy bills immediately for six months."

Will Mr Sunak look to cut the opposition off at the knees by doing precisely that?

09:45 AM

Rishi Sunak leaves Downing Street ahead of Budget

The Chancellor has brandished his red box containing the Budget details, and is now on his way to Parliament for PMQs, ahead of his Budget.

Boris Johnson will hold his weekly clash with Sir Keir Starmer before Rishi Sunak takes to the dispatch box just after 12:30pm.

09:37 AM

Analysis: Business rates could become Achilles' heel for Rishi Sunak

Delaying business rate reform yet again could be Rishi Sunak's political Achilles' heel, writes politics live editor Catherine Neilan.

Over the last 10 years or so retailers have called on successive governments to grasp the issue, arguing that bricks and mortar shops are being unfairly penalised while online giants escape the burden.

Last month Labour's Rachel Reeves confirmed she would do away with the entire system if she became chancellor - leading some business groups to suggest the opposition was doing more to support industry than the Government. Conversely Boris Johnson and his team spent much of the Tory conference accusing firms of having "mainlined" cheap foreign labour.

The Chancellor is expected to unveil a business rates exemption for green property investments today as part of the Government's climate push but wider reform is unlikely.

But with the plight of the high street during this crucial post-Covid recovery period increasingly a totemic issue, continued failure to act may leave him exposed.

09:26 AM

Agoraphobia to prevent Treasury minister from joining Budget pictures

Simon Clarke, the chief secretary to the Treasury, has said he won't be joining the Chancellor for the traditional pre-Budget pictures in Downing Street because he suffers from agoraphobia.

The condition "prevents me being comfortable in some open spaces - but will be busy in Parliament and out in the country," the minister said.

"Today is all about a major moment for the UK and we have an important story to tell about investment in our public services and infrastructure, economic recovery, levelling up and Net Zero - those are the issues I’m proud to be discussing today," he added.

09:18 AM

What other rabbits does Rishi Sunak have in his hat?

We've already heard about one rabbit in the hat that the Chancellor could pull out of his hat today - but what else is Rishi Sunak considering?

As well as addressing the Universal Credit taper, there have been suggestions of changes to child-to-staff ratios at nurseries which will help reduce the cost of childcare, but could there be more to come?

09:15 AM

Analysis: Rishi Sunak must use today's Budget to prove his Tory credentials

When it comes to being a fiscal Conservative, Rishi Sunak has spent much of the pandemic talking the talk rather than walking the walk, writes politics live editor Catherine Neilan.

Given the state-imposed lockdowns and other restrictions the country has endured, the Chancellor could do little else, spending vast sums in the hope that a stitch in time would, ultimately, save nine. But he has done so while repeatedly professing his ideological commitment to fiscal responsibility and a free-market economy.

While Covid still casts a long shadow, all the signs are that the economy is getting back on track, bringing spending down, restoring the fiscal rules that were suspended during the crisis, and returning to some semblance of normality.

That means today will finally be the chance Mr Sunak has been looking forward to put his (or rather taxpayers') money where his mouth is. Tory backbenchers - and voters - will expect nothing less.

09:01 AM

Budget analysis: Rishi Sunak’s challenge on striking the right tone

Rishi Sunak wants to use this Budget to draw a line under 18 months of extraordinary Treasury measures to prop up the economy during the Covid pandemic, writes political editor Ben Riley-Smith.

In a trail of what he is due to say circulated last night, Mr Sunak talked about the need to prepare for the “post Covid” economy and “a new age of optimism”. Changes in the numbers since his last Budget in March allow him to make the argument - growth forecasts are up, the economy is out of lockdown, he is borrowing less than expected.

But does the country really feel upbeat? There is a huge cost of living crunch coming this autumn and winter with energy bills rising, inflation soaring, pandemic-era welfare support being pulled and tax rises approaching.

Straddling those two horses - spelling out the bright new economic future the Tories want to deliver while acknowledging the financial pain millions of families are experiencing - is one of the challenges Mr Sunak faces in his speech.

It is the reason that there is lots of speculation this morning that a big announcement on helping families with the cost of living squeeze could have been held back for today.

08:55 AM

Budget 2021: No thanks Gladstone, we'll stick to the Coca-Cola

The Budget is one of Westminster's great opportunities to indulge in traditions from the red box to sweepstakes on key phrases and the length of the Chancellor's speech.

But there is one tradition Rishi Sunak has not adopted - that of taking a tipple at the dispatch box.

Perhaps he will get to sip his favourite drink - "special" Mexican Coke.

See below what some of his predecessors preferred...

08:39 AM

Budget 2021 lays foundations for Gove to push through planning reforms

As Rishi Sunak sets out the spending allocations for Whitehall departments today, it is Michael Gove who is likely to be sporting the broadest grin among Cabinet ministers, writes Whitehall editor Harry Yorke.

The new Levelling Up Secretary is due to receive £1.8bn for a new brownfield fund, helping him to unlock derelict and previously developed land for hundreds of thousands of new homes. It is something his department has been pushing hard for in order to deliver a major shift in focus in the Government’s planning reforms.

With dozens of Tory MPs threatening to torpedo the upcoming Planning Bill, amid fears it will lead to swaths of leafy “Blue Wall” suburbia being concreted over for new housing, Mr Gove sees brownfield as the key to getting the legislation through.

Brownfield land, while already built on, is more expensive to clear and make viable for developers than green fields. The problem with green fields is voters rather like them, and want them to stay green.

But by giving local authorities millions of pounds to clear brownfield land, Mr Gove is hopeful that much of the pressure on the Tory shires - and the party’s would-be rebels - will melt away.

08:32 AM

Analysis: Budget 2021 must bolster UK's green credentials before Cop26

Four days out from the start of the Cop26 climate change summit, this Budget will be forensically analysed for its “green” appeal, writes The Telegraph's deputy political editor Lucy Fisher.

New financing frameworks for nuclear plants, further investment in renewable energy, cash for electric vehicle charging points and a grant scheme for heat pumps are all expected to be announced.

But will it be enough? The Government faces pressure from the Left to go further, faster. Labour pledged at its party conference to spend quadruple the amount the Tories have so far committed to the eco-agenda over the next decade.

There’s an increasingly vocal faction on the Conservative Right, however, that wants to see the brakes applied to the Government’s net zero plan. Tory MPs in the Net Zero Scrutiny Group are deeply worried about the cost of the blueprint both to the state and to individuals.

Rishi Sunak is certainly alive to those cost concerns, but also understands that falling short on decarbonisation today would have severe political repercussions. As global leaders and 25,000 delegates prepare to descend on Glasgow this weekend, the Budget needs to bolster Britain’s eco-credibility as host of Cop26.

08:30 AM

Behind the scenes: What's happening in the Commons chamber on Budget day?

It's probably not what you were expecting...

08:29 AM

Allison Pearson: What the hell is the NHS doing with all those extra billions?

In the Budget, Rishi Sunak will throw yet more money at a terminally sick health service in urgent need of reform, writes Allison Pearson.

In an effort to turn the tide on a partially self-inflicted NHS backlog (5.7million people on the waiting list, an extra 100,000 being added every month), the Chancellor will announce a £5.9 billion spending package to help solve the crisis. It's a stupefying amount – but who’s counting?

Meanwhile, like some Soviet-era ministry, the NHS pumps out misinformation which obscures its woeful productivity and its featherbedded executive class, safe in the knowledge that no politician will dare call them out.

Read more from Allison here.

08:14 AM

Treasury photographer gets creative as Clarke and Sunak reunite

Rishi Sunak frequently likes to make self-deprecating jokes about his height. At a reported 5 ft 6, he's not the shortest man in Westminster - but it's fair to say he's not the tallest.

And Simon Clarke, the recently appointed chief secretary to the Treasury, is not making the Chancellor's beloved photo shoots easy: at 6 ft 7, he's apparently the second-tallest MP and was nicknamed Stilts at school.

Some creativity required by the Treasury photographer today....

In case you're wondering, the tallest MP is Daniel Kawczynski.

08:05 AM

Will there be any more money for the new Foreign Secretary?

After last month's reshuffle, Rishi Sunak will likely be facing demands for extra spending from ministers keen to make the most with their new brief.

Liz Truss, who many have tipped as a leadership contender - pitting her against the Chancellor, is likely to be among the most eager to see a boost to her new departmental coffers.

Yesterday in the Commons she was challenged by her shadow, Lisa Nandy, who said she must not be "a pushover with the Treasury", or else she risked being "a Foreign Secretary that isn't taken seriously in Beijing because she isn't taken seriously around her own Cabinet table".

Mr Sunak is setting out the first multi-year spending review since 2015 but it's expected to be a tight settlement, after departments were asked to identify at least five per cent savings from their day-to-day budgets.

07:58 AM

What's on the (Chancellor's) agenda today?

Rishi Sunak is now speaking to fellow Cabinet ministers, in what is his first (official) engagement of the day.

The Chancellor is due to leave Number 11 at around 10:45am, beginning with the usual red box photo opp, as he makes his way into Parliament.

Then we will have the weekly clash of PMQs, before he stands up at around 12:40pm to deliver his Budget and Spending Review.

His statement is expected to take around an hour, after which Sir Keir Starmer will respond.

Then Mr Sunak and Boris Johnson will visit a brewery in the afternoon (see 8:35am for more).

But his day won't finish with a beer - the Chancellor's media round will kick off this evening with stints on ITV and the BBC taking him well into the night...

07:51 AM

Chancellor must deliver more than 'smoke and mirrors', says Labour

Labour has called on Rishi Sunak to set out an immediate plan to support families through the winter when he delivers his Budget.

Bridget Phillipson, shadow Treasury chief secretary, said the ending of the temporary £20-a-week increase in Universal Credit was "the biggest cut to social security we have seen since the welfare state was created".

She told Sky News: "For many families it is all they have ever known. A lot of families started receiving Universal Credit because of the pandemic. It is a massive hit to families' incomes.

"We want to see immediate action to deal with the cost-of-living crisis facing families as we are entering a pretty tough winter for lots of people, but also businesses too.

"We have had a lot of smoke and mirrors going into this Budget, and it's all very good and well the Government promising things, but if that doesn't lead to people feeling that extra support in their pocket, that will be the real test for the Government."

07:35 AM

Cheers: Rishi Sunak's brewery visit sparks rumours of alcohol duty cut

Rishi Sunak has got a busy day ahead of him - I'll post his speaking schedule shortly.

But he is not spending the entire time in Westminster.

After delivering the Budget, the tee-total Chancellor is expected to join Boris Johnson at a brewery visit - sparking suggestions that cuts to alcohol duties are expected.

07:33 AM

Budget will leave us 'better off', yet there is a 'difficult period ahead', admits former minister

A former minister has insisted today's Budget will leave us "all better off", despite admitting there is a challenging period ahead.

Speaking ahead of Rishi Sunak's announcement Robert Jenrick, who was sacked as communities secretary in last month's reshuffle, said "there are reasons for optimism" as economic growth and better-than-expected unemployment rates "gives the Chancellor room" to invest in public services as well as shoring up the public finances.

Asked who would be better off after today, the senior backbencher told Sky News: "We are all going to be better off - OBR forecasts are going to show the economy has grown substantially, therefore we are borrowing less as a country and that gives the Chancellor more room to to invest in the future of public services that we all depend on like the NHS.

"But we also need to think carefully about those on the most modest incomes and help them weather what is undoubtedly going to be a difficult period."

He noted that some risks remain, which required the Chancellor to be " fiscally prudent", particularly inflation, with the knock-on consequences of interest rate rises which would be "very costly to the country."

07:18 AM

Test and Trace 'treated taxpayer as ATM machine', claims senior MP

The Test and trace programme treated taxpayers as if they were an ATM machine, the chair of the Commons Public Accounts Committee has said.

A highly critical report by the committee found the programme, headed by Baroness Harding, failed in its objectives despite spending an "eye-watering" £37 billion.

Dame Meg Hillier, committee chairwoman, told the BBC Radio 4 Today programme: "There was a lot of gung-ho confidence from No 10 that we would have a 'moonshot' towards mass testing.

"Those messages kept getting more optimistic. Baroness Harding was also very optimistic about what they achieved.

"But in the end it massively over-promised for what it delivered and it was eye-watering sums of money.

"That is one of the biggest concerns - it is almost as if the taxpayer was an ATM machine. That lack of regard for taxpayer funding is a real concern for us as a committee."

07:15 AM

Universal Credit U-turn could be 'rabbit out of Budget hat', says Andy Burnham

As is usual on Budget day, there are no ministers doing the round lest they let slip details before the Chancellor.

Of course, the multiple briefings from the Treasury make that something of a mockery, but still - some traditions must be upheld.

However Andy Burnham, the Mayor of Greater Manchester, has told BBC Radio 4's Today programme he believes there will be a U-turn on Universal Credit.

It has been widely thought that Rishi Sunak could address the taper rate, which penalises claimants as they start to earn more. MPs such as Iain Duncan Smith - are believed to have petitioned him to make this change after the Chancellor dug his heels in over ending the uplift. But Mr Burnham suggested he could go further.

Mr Burnham said: "On the rabbit out of the hat I hearing they are about to U-turn on Universal Credit... and I hope that is the rabbit that is in his hat today.

"If he is going to do that, it is the right thing to do. This pandemic is not over, people are still feeling its effects - but credit to those who have campaigned - particularly on the Labour frontbench who have been consistent on this point."

07:07 AM

Budget 2021: What to expect from today?

Rishi Sunak has already announced a swath of measures - putting him on a collision course with the Speaker.

Sir Lindsay Hoyle may well give the Chancellor a piece of his mind today, having repeatedly granted urgent questions over the pre-Budget briefings.

But it's unlikely to knock Mr Sunak off his stride, as he is expected to take an upbeat tone thanks to bolstered economic forecasts. Trails overnight suggest he will hail a "new age of optimism" and talk up building a "stronger economy of the future", with the promise of rising wages, cash for the NHS and investment into regional transport projects.

The Office for Budget Responsibility (OBR), the independent body whose forecasts guide Budget spending, is expected to up its growth outlook for 2021, cut its unemployment prediction and pencil in lower borrowing thanks to higher tax receipts.

The EY Item Club, a UK economic forecasting group, believes the OBR will hike its gross domestic product (GDP) forecast for 2021 to growth of 7% from the 4% forecast at the last fiscal statement in March.

07:01 AM

There should not be two-tier rule on masks in Parliament, says former minister

A former minister has criticised plans to make face masks mandatory on the parliamentary estate for everyone except MPs.

Sir Lindsay Hoyle, the Speaker, issued new rules last night making them mandatory for everyone working in the House of Commons - but the Commons authorities do not have the power to force MPs to do so.

Robert Jenrick said he would be wearing his mask during today's Budget as he said it "doesn't seem right that there is one rule for everyone else in the building but not members of Parliament...

"I don't think we can ask something different of staff and other people in the building that we ask of ourselves."

He told Sky News: "We will have to consider wearing a mask in the coming days."

Of the Budget he added: "I will [be wearing a mask] - it will be a busy occasion, lots of people tightly packed."

06:58 AM

'Last-minute wrangling' required to make Cop26 a success as Queen cancels appearance

The Government will have its work cut out to make Cop26 a success, a former minister has admitted, as the Queen "regretfully" pulled out.

After a hospital stay this week, the monarch will instead deliver a speech to delegates via video message, due to be filmed at Windsor Castle later this week.

Robert Jenrick said he sent his "best wishes" to the Queen, telling Sky News that while she would have liked to attend it was "much more important" to look after her well-being.

But he acknowledged the challenge facing the Government to make the climate summit a success, saying: "We need to make sure those countries who are biggest emitters come to the table... there is lots of last minute wrangling to be done."

He praised the Prime Minister and Alok Sharma, saying they could not have "done more" to get world leaders there, pointing to commitments by Australia and Saudi "albeit at a lower trajectory than we would have liked".

He added: "A lot more needs to be achieved in the next few days."

06:54 AM

PAC report on Test and Trace 'very concerning', former minister admits

A former minister has admitted the Public Accounts Committee (PAC) report into Test and Trace is "very concerning".

Robert Jenrick partially defended the system, saying it did "save lives", and had been "established from the ground upwards" at the start of the pandemic.

But he admitted: "It is very concerning what they have said." The former minister stressed it was important to learn lessons so the country was better prepared for future pandemics. "We should pay heed to what PAC says," he told Sky News.

Speaking later to Times Radio, he said the overall the amount spent on consultants was "poor value for money".

06:43 AM

NHS Test and Trace criticised as ‘eyewatering’ waste of cash

NHS Test and Trace has been an “eye-watering” waste of taxpayers’ money which did not achieve its objectives, despite £37 billion of funding, a damning report has warned.

The funding - equal to almost a fifth of the entire health service budget - was used to hire more than 2,000 consultants who were employed on rates of more than £1,000 a day, the report by the public accounts committee (PAC) found.

At certain times, just 11 per cent of contact tracers were working, the PAC found, with the figure never rising beyond 49 per cent.

MPs said billions had been squandered on a failed promise to “enable people to return towards a more normal way of life”, which instead saw two national lockdowns and a rise in case numbers.

06:43 AM

Good Morning

Westminster will shortly be alive with Budget buzz - but will Rishi Sunak finally get that in-person telling off from the Speaker?

And, while the Chancellor will be looking to get on the front foot by showing how fiscally responsible he is, a senior group of MPs has issued a damning report about the wastefulness of Test and Trace.

Here is today's front page.