Budget 2023 – live updates: Pension lifetime allowance and childcare changes at a glance

OBR forecasts biggest fall in living standards on record as Labour’s Sir Keir Starmer accuses chancellor Jeremy Hunt of ‘permanent tax cut for wealthy’

Budget 2023: Pension lifetime allowance cap abolished

Jeremy Hunt has promised a major expansion in state-funded childcare and tax breaks for businesses in Budget measures aimed at boosting economic growth.

The Chancellor said a recession would be avoided and inflation would fall dramatically as the economy was “proving the doubters wrong” in his statement to the Commons on Wednesday.

In an effort to remove barriers to work, he promised up to 30 hours a week of free childcare for eligible households in England with children as young as nine months.

Mr Hunt resisted demands from Tory MPs to scrap April’s increase in corporation tax from 19% to 25%, but he instead promised a set of reliefs to help firms reduce their bills.

And as part of a package aimed at helping with the cost of living, the Chancellor said the energy price guarantee will be extended at its current level from April to June.

However, fiscal watchdog the Office for Budget Responsibility forecast the biggest fall in living standards on record.

The OBR upgraded its growth forecast for 2024 from 1.3% to 1.8%, but downgraded predictions for the following years to 2.5% in 2025, 2.1% in 2026 and 1.9% in 2027.

Key Points

• Watchdog forecasts biggest fall in living standards on record
• UK will avoid recession in 2023, chancellor says
• Chancellor scraps lifetime allowance limit on pensions
• Hunt announces huge reform in childcare to help parents get back into work
• Hunt announces ‘biggest change to our welfare system in a decade’
• Government will add £11bn to defence budget over five years
• Chancellor will invest over £200m in local regeneration projects in widescale levelling-up series

[15 March 2023 12:36 · Maryam Zakir-Hussain]

UK will not enter a ‘technical recession’ this year

The UK will not enter a “technical recession” this year, Jeremy Hunt told the Commons.

The Chancellor said: “We remain vigilant, and will not hesitate to take whatever steps are necessary for economic stability. Today the Office for Budget Responsibility forecast that because of changing international factors and the measures I take, the UK will not now enter a technical recession this year.

“They forecast we will meet the Prime Minister’s priorities to halve inflation, reduce debt and get the economy growing. We are following the plan and the plan is working. But that’s not all we’ve done.”

[15 March 2023 12:38 · Maryam Zakir-Hussain]

Chancellor promises ‘growth’ for UK economy in Spring Budget

The Chancellor summarised his plans to deliver a growth for the UK economy.

Jeremy Hunt said: “I deliver that today by removing obstacles that stop businesses investing; by tackling labour shortages that stop them recruiting; by breaking down barriers that stop people working; and by harnessing British ingenuity to make us a science and technology superpower.”

(Parliament TV)

[15 March 2023 12:38 · Maryam Zakir-Hussain]

Live: Jeremy Hunt presents Government's 2023 Budget as energy bill support extended

[15 March 2023 12:40 · Maryam Zakir-Hussain]

Hunt says he listened to energy advice from Martin Lewis

Jeremy Hunt has said he listened to advice from Martin Lewis when he decided to extend the energy price guarantee for a further three months.

Mr Lewis posted a letter from the chancellor on Twitter:

[15 March 2023 12:42 · Maryam Zakir-Hussain]

Chancellor talks about prepayment meters and direct debit

Chancellor Jeremy Hunt said prepayment meters currently pay more than comparable customers on direct debit, noting: “Ofgem has already agreed with suppliers a temporary suspension to forced installations of prepayment meters.

“But today I go further, and confirm we will bring their charges in line with comparable direct debit charges. Under a Conservative government, the energy premium paid by our poorest households is coming to an end.”

Mr Hunt said he would provide a £63 million fund to “keep our public leisure centres and pools afloat” in response to high costs and £100 million will be given to support thousands of charities and community organisations.

In a nod to Sajid Javid, Mr Hunt went on: “I also note the personal courage of one of my predecessors (Mr Javid) in talking about the tragedy of suicide and the importance of preventing it.

“We already invest a lot in this area, but I will assign an extra £10 million over the next two years to help the voluntary sector play an even bigger role in stopping more families experiencing such intolerable heartache.”

[15 March 2023 12:44 · Maryam Zakir-Hussain]

UK will avoid recession in 2023, chancellor says

The UK will not enter a “technical recession” this year, Jeremy Hunt told the Commons.

Starting his Budget, chancellor Jeremy Hunt has said the British economy is “proving the doubters wrong” in the face of “enormous challenges.”

He added that the UK economy is “on the right track.”

The chancellor said: “We remain vigilant, and will not hesitate to take whatever steps are necessary for economic stability. Today the Office for Budget Responsibility forecast that because of changing international factors and the measures I take, the UK will not now enter a technical recession this year.

“They forecast we will meet the prime minister’s priorities to halve inflation, reduce debt and get the economy growing. We are following the plan and the plan is working. But that’s not all we’ve done.”

[15 March 2023 12:46 · Maryam Zakir-Hussain]

Chancellor will ‘significantly increase draught relief’

Jeremy Hunt said he would “significantly increase the generosity of draught relief”, saying this could not be done when the UK was in the EU.

He told MPs: “From August 1 the duty on draught products in pubs will be up to 11p lower than the duty in supermarkets, a differential we will maintain as part of a new Brexit pubs guarantee. British ale may be warm, but the duty on a pint is frozen.”

Mr Hunt said the change will apply to “every pub in Northern Ireland” due to the Windsor Framework.

[15 March 2023 12:47 · Maryam Zakir-Hussain]

Chancellor will not uprate fuel duty with inflation

On fuel duty, Jeremy Hunt said: “Because inflation remains high, I have decided now is not the right time to uprate fuel duty with inflation or increase the duty.

“So here’s what I am going to do: for a further 12 months I’m going to maintain the 5p cut and I’m going to freeze fuel duty too. That saves the average driver £100 next year and around £200 since the 5p cut was introduced.”

[15 March 2023 12:49 · Maryam Zakir-Hussain]

Paul Johnson, the director of the Institute for Fiscal Studies (IFS), tweeted: “Rather odd that the chancellor just claimed that simply uprating benefits in line with inflation is part of a £94bn support package.

“It doesn’t even maintain real value of benefits and (should) happen automatically.

“Inflation projected to be down to 2.9% by end of this year. That would be good news.

“It is not true, though, that giving public sector workers a bit more would significantly raise inflation.”

[15 March 2023 12:52 · Maryam Zakir-Hussain]

Hunt highlights UK’s ‘innovation industries'

Jeremy Hunt said “declinists are wrong” about the future of the country as he highlighted the country’s “innovation industries”.

He added: “Our film and TV industry has become Europe’s largest, with our creative industries growing at twice the rate of the economy. Our advanced manufacturing industries produce around half the world’s large civil aircraft wings. And thanks to a clean energy miracle we have become a world leader in offshore wind.

“Other parties talk about a green energy revolution, so I gently remind them that nearly 90% of our solar power was installed in the last 13 years - showing it’s the Conservatives who fix the roof while the sun is shining.”

(PA Wire)