Chancellor Philip Hammond has stuck to his script while delivering the Spring Budget against a backdrop of heightened uncertainty as the government prepares to leave the European Union.
Britain's economy will grow more than forecast this year, before slowing down next year, while public sector borrowing is expected to peak in 2018, while an extra £2bn will spent in social care over the next three years. Here are the key points from the Chancellor's Spring Budget:
- The OBR now expects the UK economy to grow 2% this year, compared with a previous forecast of 1.4%. However, growth will slow to 1.6% in 2018, before picking up to 1.7% in 2019, 1.9% in 2020, and 2% in 2021.
- An extra £2bn will go into social care in England over the next three years, with £1bn available in 2017-18.
- Debt is forecast to be 86.8% of GDP this year, before reaching an 88.8% next year which, however, is 1.4% lower than initially forecast.
- There are no changes to the previously planned charges on tobacco and alcohol products, while vehicle excise duty will be frozen for hauliers, and HGV road user levy will also be frozen.
- The national living wage will rise to £7.50 in April, while the personal allowance will increase for the seventh year in a row, and the higher rate threshold will rise to.
That concludes our live coverage of the Spring Budget for today. Thanks very much for following and remember you can find more in-depth analysis of today's events and of the key points of the Spring Budget here.
Meanwhile, Hammond could be facing a self-employment related backlash after announcing a hike in National Insurance Contributions (NICs) in his Spring Budget.
Hammond will scrap class two NICs for self-employed workers from April 2018 and increase the main rate (class four) NICs by 9% to 10%, with an additional 1% hike in April 2019. The take rise will cost more than 2.4 million self-employed workers £240 a year.
On the subject of growth forecast, analysts say that the OBR's caution on both the economy and the fiscal outlook deprived the Chancellor Phillip Hammond of the additional Brexit "war chest" that some had predicted.
The OBR expects the UK economy to grow 2% this year, compared with a previous forecast of 1.4%. However, growth will slow to 1.6% in 2018, before picking up to 1.7% in 2019, 1.9% in 2020, and 2% in 2021.
"If we are right in expecting the economy to remain rather more resilient than the OBR expects, then public borrowing will clearly fall rather faster and give the Chancellor more elbow room," said Jonathan Loynes, chief economist at Capital Economics.
"For now though, the big picture is still one of a substantial further tightening of fiscal policy over the coming years."
The Budget has so far not had a major impact on the markets, with both equities and FX meandering along, much as they did before Hammond's speech.
"Markets took a drab Budget in their stride [...] as you would expect, there was plenty of pro-business stuff in there and growth for 2017 was revised higher, in line with other forecasts," said Neil Wilson, Market Analyst at ETX Capital.
"Spreadsheet Phil cracked a few jokes but this was a Budget pretty low on content as far as investors are concerned – the reduction in the tax free dividend allowance aside.
"This was a dry run for the new autumn set piece when he will know a lot more about what the Brexit landscape looks like."
The Chancellor's plans to raise National Insurance tax for self-employed workers have not been met with universal approval.
Maike Currie, investment director for personal investing at Fidelity International, said it was "disappointing" that a Chancellor who once worked for himself could launch such a tax blitz on the incomes of the self-employed.
"A key driver behind the surge in self-employment was the 2008 financial crisis and the tough labour market left in its wake. Indeed, self-employment has accounted for one-third of all jobs created since 2010," she said.
"Other factors driving the so-called 'gig economy' has been technological change and an aging population - the rise of the 'silver entrepreneur' has accounted for half of the increase in self-employment since 2004, according to the Bank of England.
"Working for yourself by definition means greater insecurity and the risk of falling incomes [...] If you are part of the self-employed cohort, now more than you ever you need to have a firm grip on your personal finances."
Ben Handley, director at PwC, said the Budget felt like a bit of a mixed bag for start-up and small entrepreneurial businesses.
"Measures to relieve the cost of business rates, reduction in administration for R&D claims and confirmation of lower corporation tax rates will be welcomed," he explained.
"But the reduction in dividend exemption from £5,000 to £2,000 could increase the cost of withdrawing profits from a business by over £1,000 from 6 April 2018.
"We are also expecting a review of the taxation of partnership and company structures in the summer which may provide a backdrop of uncertainty for those setting out now on a new business venture."
The Confederation of British Industry (CBI) described the Budget as a "major breakthrough" for the business sector.
"This is a breakthrough Budget for skills," said CBI Director General Carolyn Fairbairn.
"There has never been a more important time for the UK to sit at the global top table of technical education for young people.
"Firms will be looking for ongoing partnership with the Government as they try to make the Apprenticeship Levy work.
"However, with inflation rising and the cumulative burden weighing on businesses' shoulders, limited relief for firms hit hard by business rates falls short.
"Firms are wholly committed to the health and wellbeing of their people, and are pleased to see an increase in spending on social care."
Hammond delivers "safety first Budget"
Analysts suggest Hammond delivered a 'safety first' Budget with some well targeted giveaways on social care, vocational training and business rates relief that were broadly offset by tax rises for the self-employed and other measures.
"The Chancellor's caution is understandable given that, despite better than expected short term numbers, the OBR made little change to its medium-term projections for either economic growth or public borrowing," said PwC chief economist John Hawksworth.
"The timing of the adverse economic and fiscal impact of Brexit has been pushed back a bit, but the eventual impact in 2021 remains more or less the same as in the Autumn Statement in November."
Hawksworth added that the many economic and political uncertainties around Brexit and other geopolitical events, it was prudent for the Chancellor to protect the £26bn headroom he left himself in meeting the new fiscal target he set out in the Autumn Statement.
"But, given the OBR's view that the underlying economic position has not changed materially since November, the Chancellor was not able to add to this headroom despite his cautious overall Budget judgement," he said.
The Federation of Small Business has welcomed the Chancellor's decision to listen to the small business-led campaign on business rates.
"The £435m of new money is a direct and much-needed response to those facing astronomical hikes in their business rates," said Mike Cherry, the FSB National Chairman.
"This immediate relief is vital in the short-term, and action on more frequent revaluations will also help. But this tax remains out-of-date, so today we call for a cross-party Commission to create a simple, fair tax system for a modern economy."
Petra Wilton, director of Strategy and External Affairs at the Chartered Management Institute, has welcomed Hammond's decision to spend £500m a year to support 16-19-year olds in technical education.
"For the UK economy to punch above its weight post-Brexit we need to start ramping-up the number of young people entering the labour force with work-ready higher skills," she said.
"According to our research, one-third of 16-21-year olds in the UK aren't confident of finding a job in the next few years. Alongside championing the Government's apprenticeship agenda, we support this transformation of technical education that will lay clearer career paths for those leaving school. But to deliver the highly skilled workers we'll need to compete post-Brexit, these technical routes must be developed with employers and aligned with the new breed of apprenticeships."
Phil Vernon, head of rating at PwC, said the Chancellor's announcement to introduce new business rates transitional arrangements for businesses losing Small Business Rates Relief and a new £1,000 discount for many pubs is a welcome boost to small and medium sized business in London and the South East.
"However, at some point over the next five years many businesses will bear the full brunt of the large jump in their Rateable Values," he adds.
"Businesses in the north of England will also be breathing a sigh of relief as their expected decreases have not been further curtailed by this announcement."
Hammond reiterates the government remains committed to continue with its plan to improve the economy, adding it is determined to make Britain the best place in the world to do business.
"We have a remarkable history," he says. "But we look forward, confident our best days are ahead of us."
And, with that, the last ever Spring Budget is done and dusted.
Hammond adds £100m will be available to set up to fund triage projects in A&E departments, in time for next winter. As the result of the Copeland by-election showed, "we are the party of the NHS".
Hammond says an extra £2bn will go into social care in England over the next three years, with £1bn available in 2017-18. Hammond says this will allow local authorities to act immediately and he adds the funds will help the NHS getting back on track.
This is how much the UK spends on healthcare as a proportion of GDP.
Some £200m will be allocated to projects to get private sector investment in full-fibre broadband networks, Hammond adds. Meanwhile, on the subject of education, the Chancellor says says 1.8 million more children are being taught in good or outstanding schools than seven years ago.
The government remains committed to create more selective free schools, to allow academically gifted students to thrive, he says, adding that new funding will be directed towards an extra 110 free schools, on top of the 500 already announced.
Free school transport to be extended to all pupils on free school meals at a selective school, while an additional £260m will be invested in improving school buildings.
Hammond says rising living standards is crucial to deliver an economy that works for everyone. The Chancellor will allocate £300m to support the brightest research talent, including 1,000 PhD students in STEM subjects
On the wage front, Hammond says the national living wage will rise to £7.50 in April, while the personal allowance will increase for the seventh year in a row, and the higher rate threshold will rise to.
The Chancellor has now moved onto duties. There are no changes to the previously planned charges on tobacco and alcohol products, while vehicle excise duty will be frozen for hauliers, and HGV road user levy will also be frozen.
Hammond adds there will be a reduction in the revenue from the sugar tax, as producers have began reducing the amount of sugar in drinks, but schools will receive the £1bn revenue expected for this.
On the subject of corporate taxes, Hammond says tax-free dividend allowance will be reduced from £5,000 to £2,000 from April next year. The Chancellor insists he wants Britain to be an attractive place for businesses, but he warns against people forming a company simply to avoid tax.
Hammond now turns to the self-employed. The Chancellor outlines plans to raise National Insurance tax for self-employed workers, adding that the new state pension has removed the discrepancy between self-employed and other workers. As a result, the former no longer need to have different tax rates, as both categories use public services.
The lower NIC rates cost the taxpayer £5bn a year, but the new measure will reduce the gap.
However, that means the Chancellor will break a pledge the Tory party made in its manifesto before the 2015 General Election.
Hammond says that the top 1% of income tax payers now pay 27% of all income tax, a higher proportion than under Labour, but he insists there is to be fairness between individuals. As such, he says a series of measures to be implemented will raise an extra £820m over the forecast period.
Hammond says business rates raise £25bn a year, which means they cannot be abolished. However, he admits the digital sector of the economy needs to be better taxed in the medium term. The Chancellor adds that the business rates system needs to be fairer and that the Government will outline plans and unveil its preferred approach before the next revaluation.
There are three main measures, which Hammond has set out.
Any business coming out of small business rate relief will benefit from an extra cap, which means rates will not raise by more than £50 a month and there will be a £1,000 discount on business rates bills for 90% of British pubs.