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UK growth 'better than expected' Brown unveils 'green' tax plans
(about 1 hour later)
The British economy is expanding faster than expected, Chancellor Gordon Brown has told MPs. Gordon Brown has sought to establish his green credentials as he announced fuel and air duty increases in his 10th and possibly final pre-Budget report.
Mr Brown has revised his 2006 forecast upwards to 2.75%, from last year's Budget predictions of 2-2.5%. He also said stamp duty on some "carbon neutral" new homes could be scrapped.
Mr Brown, who is expected to become prime minister next year, is delivering his 10th and possibly final pre-Budget report in the House of Commons. The chancellor said economic growth of 2.75% had beated forecasts and pledged to pay Child Benefit from the 29th week of pregnancy to all mums-to-be.
He announced a boost for skills training and committed to making every home "zero carbon". The Tories said Mr Brown was moving the UK in the "wrong direction" and mocked his claim to be "green".
Although fuel duty is going up 1.25p per litre from midnight and air passenger duty from £5 to £10 for most flights, Mr Brown rejected demands to re-link petrol prices to inflation.
PRE-BUDGET REPORT
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Mr Brown told MPs the UK was performing better than its major competitors, apart from the US, and the country was enjoying the "longest period of sustained growth in our history".Mr Brown told MPs the UK was performing better than its major competitors, apart from the US, and the country was enjoying the "longest period of sustained growth in our history".
But he also stressed the importance of investment in education and training if Britain is to compete with countries such as China and India. Much of his speech, in the House of Commons, focused on investment in schools and training which he said was vital if the UK was to compete in the future with countries such as China and India.
PRE-BUDGET PREDICTIONS Economic growth to meet or exceed targetFuel duty to be re-linked to inflationAir passenger duty tax increaseFuture education spending plans to be unveiledCrackdown on music and film piracy Children
Universities will receive £60m a year for applied research with commercial potential to help British science to transform knowledge into new jobs.
Former director general of the CBI, Sir Digby Jones, has been made the government's skills envoy, said Mr Brown.Former director general of the CBI, Sir Digby Jones, has been made the government's skills envoy, said Mr Brown.
Education He said there would be new cash for children who had fallen behind at schools and more basic skills training for adults.
Mr Brown said trend growth will be maintained at 2.75%, while the public finances will be based on a rate of 2.5%
And he forecast economic growth next year of 2.75% to 3.25%.
HAVE YOUR SAY I want to see an increased winter fuel allowances for our pensioners Paul, London Send us your commentsHAVE YOUR SAY I want to see an increased winter fuel allowances for our pensioners Paul, London Send us your comments
He is also expected to unveil green measures in an attempt to steal back the initiative on the environment from Tory leader David Cameron. There would also be an increase in the number of apprenticeships on offer for young people, he said.
Speculation has focused on the possible taxes on the most polluting cars and for air travel, after the Stern review in October on climate change warned that action was necessary to combat global warming. With all eyes on next summer's Comprehensive Spending Review, Mr Brown held off from making major policy announcements.
The chancellor is also responding to some of the major Treasury-commissioned reviews which have reported over the past week. But he unveiled details of capital investments in schools in England. Separate announcements would be made for Wales, Scotland and Northern Ireland.
'Wizard of Oz' He pledged to increase spending to £10bn by 2010, which he said would match spending on buildings in the state sector to that in the private sector.
Ahead of the speech the chancellor was denounced by his Conservative shadow George Osborne as a "Wizard of Oz" chancellor, whose loud boasts of economic success masked actual failure. Other measures include:
"It looks impressive but when you pull back the curtain there he is pulling levers that are not actually connected to the real world," he told BBC News 24.
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  • A further 300,000 households to be offered free insulation and free central heating.
Liberal Democrat treasury spokesman Vince Cable said his party's research suggested wasteful government spending was now exceeding £30,000 a minute.
  • Consultation on bringing in bursaries worth £2,000 for looked-after children to go to university.
    • "Gordon Brown's legacy may be to leave his successor with two enormous problems - personal debt and government waste," said Mr Cable.
  • Bookstart scheme to be extended so children get more free books when they leave primary school.
    • Mr Brown said trend growth (the assumed rate) of the UK economy will be maintained at 2.75%, while the public finances will be based on a rate of 2.5%
    And he forecast economic growth next year of 2.75% to 3.25%.