Osborne ‘to support resilient economy’

Ahead of the chancellor’s speech at 12.30 GMT, Treasury sources said the government’s economic plan was working but the “job was far from done”, reports The BBC.

Among tax changes expected, the amount of income people receive tax free could be raised above £10,000.

But Labour said there had already been 24 separate tax increases since 2010.

Mr Osborne’s fifth Budget as chancellor comes against a backdrop of a strengthening economic recovery, with unemployment and inflation falling and growth this year projected to be the among the strongest of any Western economy.

Business groups have forecast that the UK’s total economic output will exceed its pre-recession peak in the second quarter of 2014 after the economy grew by 1.9 per cent in 2013.

But Labour says the majority of people are worse off than four years ago and that household budgets are being squeezed as prices continue to rise faster than wages.

And some ministers have also expressed concerns that the recovery is being driven by debt-fuelled consumption and a boom in house prices in London and the south of England.

Alongside details of proposed tax and spending changes, Mr Osborne will announce the Office for Budget Responsibility’s latest forecasts for economic growth and government borrowing for the years ahead.

Mr Osborne has insisted deficit reduction remains his number one priority, with the ultimate goal of delivering an annual budget surplus before 2020. But critics say he has missed targets and has borrowed billions more than originally planned in 2010.

In the run-up to the Budget, the government has announced plans to offer up to £2,000 in subsidised childcare to working families after the next general election, a proposed rise in the hourly minimum wage to £6.50 and an extension of the Help to Buy Scheme for aspiring homebuyers.