UK government delivers Pre-Budget report

The Chancellor , Alistair Darling today delivered his Pre-Budget Report setting out plans to halve the UK's budget deficit.

The Chancellor said he expects the UK economy to return to growth in the fourth quarter of this year, and growth next year is forecast to be between one per cent and 1.5 per cent, he said.

The Chancellor outlined a number of measures in the Pre-Budget Report:

• VAT will return to 17.5 per cent on 1 January, as planned


• Support for the Mortgage Interest Scheme would be extended for a further six months


• From next month, anyone under 24 unemployed for longer than six months will be guaranteed work


• The minimum number of hours over 65s need to work before receiving Working Tax Credit will be reduced


• The UK will finance four Carbon Capture and Storage demonstration projects


• An additional £200 million will be made available to help with energy efficiency


• Up to 125,000 homes will receive help to replace the most inefficient boilers and an extra 75,000 households will benefit from an extension of the Warm Front scheme


• A 10 per cent corporation tax rate on income which stems from patents in the UK will be introduced


• Plans for rail electrification between Liverpool, Manchester and Preston will go-ahead


• Government measures mean more than half of additional revenue raised will be paid by the top two per cent of earners


• No one earning under £20,000 will pay any more NI contributions


• Free school meals will be extended to half a million primary school children of low income working parents


• A further £2.5 billion will be set aside for military operations in Afghanistan

Read more about the Pre-Budget Report on the Treasury’s website