George Osborne says "Britain is on the right track"
George Osborne, Chancellor of the Exchequer, has said in his Autumn Statement that "We are making progress. It is a hard road, but Britain is on the right track and turning back would be a disaster."
Mr Osborne added that the coalition Government was "Confronting not ducking the country's problems."
After his opening comments, Mr Osborne went on to the findings of the Office for Budget Responsibility, saying that one of the advantages of the OBR is that we get independent forecasts, and independent explanations. The OBR is forecasting -0.1% growth for 2012, but this increases next year to 1.2% growth next year, 2% in 2014, 2.3% in 2015, 2.7% in 2016 and 2.8% in 2017.
Mr Osborne says borrowing is also due to fall - £99bn next year, £88bn in the following year and then £73bn, then £49bn, then £31bn.
The OBR is predicting unemployment to peak at 8.3% and Mr Osborne pointed to the fact that Britain had a higher rate of employment than either the US or the eurozone and that the UK's economy is recovering more quickly than either France or Germany.
The OBR also says that the government is "on course" to meet its target of getting rid of the structural deficit over five years, but that the government will miss its target of getting debt falling by 2015 due to tougher economic conditions. It will start falling a year later, he says.
The tougher economic conditions mean that it will take four years, not three years, to get debt falling, he says.
"We need to find other savings – and we need to do it in a way that is fair. Those with the most should contribute the most, and they will. But fairness is also about being fair to the person who leaves home every morning to go out to work and sees their neighbour still asleep, living a life on benefits."
One relatively unexpected announcement was the 1% cut in corporation tax, which will be an early Christmas present for UK firms (although it won't come in until April 2014). This will be the lowest rate for any western economy, he says, and will show Britain is open for business.
However, for the general public the fact that Osborne says the government has frozen council tax, and cut fuel duty will be more of a headline grabber.
Mr Osborne has also announced that personal tax allowance is to rise by £235 more than planned in April next year, which means it will go up by £1,335 in total next year. He went on to say this means the government is "within touching distance" of getting the tax threshold up to £10,000. Today's decision will be worth £47 to people, he says.
In summary, George Osborn is ploughing on with the Coalition Government's austerity plan, saying that they are on the right road to reduce the country's deficit, but slower than at first anticipated due to economic conditions elsewhere in the world.
Shadow Chancellor Ed Balls has responded by saying that "We've had the longest double-dip recession since the second world war, now followed by the slowest recovery on record."
Mr Balls says: "The truth is he's failed on growth and the deficit, and what's his answer? More of the same."
