Autumn Statement: What is it and why does it happen?

Tory chancellor George Osborne will deliver the Autumn Statement on Wednesday 3 December at 12.30pm (Getty)

George Osborne is scheduled to outline the government's financial plans to Parliament in the Autumn Statement next week on 3 December.

What is it?

The Chancellor of the Exchequer will give the televised statement at 12.30pm to provide updates on the Government’s economic future, which are likely to include spending allocations, reforms and some taxation policies.

It is the second in the two most important economic statements of the year after the Budget in spring.

Soon after the Autumn Statement, which now happens in December rather than November like it did in the 80s and 90s, the Office for Budget Responsibility (OBR) publishes its estimates and forecasts.

What is he going to say?

As it will be the last Autumn Statement before the General Election next May, it is expected that Mr Osborne will offer a financial incentive for the electorate to vote for the Conservatives.

Mr Osborne has already indicated that he will detail plans to give three cities in the north of England - Leeds, Sheffield and Manchester - more self-rule in order to boost the economy in those regions.

And there will also be more details on the Government's idea for a tunnel to go under Stonehenge with the aim of getting rid of the regular bottleneck on the A303.

He will also detail plans to extend capital gains tax to non-UK residents - so overseas residents who buy and sell UK properties won't be able to avoid paying their fair share to the Treasury, the Mirror reports.

It is also rumoured that there will also be new measures to combat tax avoidance by technology companies basing their headquarters in tax havens and a potential new criminal offence relating to offshore tax avoidance.

In a bid to secure positive public opinion, Mr Osborne is expected to highlight Labour's shadow chancellor Ed Ball's plans to borrow more throughout the next parliament for housing and infrastructure improvements, despite the Tories and Liberal Democrats agreeing that finances should be in the black by 2018, the Telegraph reports.

Tory plans to shift the 40p rate of tax higher to a £50,000 threshold could also be scuppered, despite slight economic recovery and a £7.7 billion reduction in borrowing, as income tax payments have been lower than expected due to wages remaining low.

Lib Dem leader Nick Clegg has suggested that a pledge to spend an extra £1.5bn on the NHS will also be announced.

And it's possible there'll be reforms to taxation of pensions and inheritance tax, which are both unpopular policies for the Tories.

However, building society Nationwide have warned that Mr Osborne's plans for state-owned market-beating bank bonds for pensioners could have a negative effect on commercial bank deposits and mortgage lending.

How long does it last?

Although previous Autumn Statements delivered by ex-chancellors have gone on for hours, Mr Osborne is not known for long-winded speeches so it is expected that he would have the announcement wrapped up within an hour.