Rolling coverage and full reaction and analysis as George Osborne delivers the final autumn statement of this parliament
OBR: Grim forecast of cuts ahead
Chancellor announces higher growth figures
But higher deficit this year
Stamp duty reform “to benefit 98%”
6.11pm GMT
“The chancellor poses as steadfast, but he continually rewrites his ‘long-term plan’ and has not come clean about the dreadful consequences of the endless cutting buried in the smallprint”.
That’s a summary of our take on the autumn statement:
6.00pm GMT
So much for autumn statements being a mere update on the economy, as George Osborne promised in 2010.
Chris Sanger, EY’s head of tax policy, has crunched the numbers and reckons today’s statement has more policy changes than March’s budget.
“Today’s Autumn Statement was a reversion to form and even more like a Budget than the one in March, with 59 policy measures compared to 56 earlier this year.
With the election around the corner, the Chancellor was clearly more focused on the politics of the day than worries over tinkering with the tax system.”
5.45pm GMT
More anecdotal evidence of the impact of the stamp duty changes:
Just spoken to estate agent who recently agreed sale on house in Belgravia for £16m. He is about to tell buyer his stamp duty bill up 500k!
Friend buying a flat that's £250k (ie just under stamp duty slab threshold). Offer accepted, seller just pulled out and gave no reason. Hmmm
Wonder if flat will go back on the market straight away at a slightly higher price
5.33pm GMT
We like to cover every angle on these big occasions, so here’s the fashion world’s take on the chancellor’s new, spruced-up image.
5.24pm GMT
Here, fairly randomly, are two striking tweets from journalists about the autumn statement.
The autumn statement can distract us from the big picture. Here it is. http://t.co/6oNWDGbMu1 pic.twitter.com/ouJ1x9pDCy
I find myself staring at this chart quite a lot. #autumnstatement pic.twitter.com/PkxG4ReMtY
5.22pm GMT
This is a good spot, from my colleague Greg Wood.
The Horserace Betting Levy, a statutory system which has returned money to the horse racing industry from off-course betting shops for nearly 50 years, could be replaced by a legally-enforceable right to accept bets on the sport.
The government announced in the Autumn Statement that it will consult in early 2015 on the introduction of a Horserace Betting Authorisation. Under the proposed scheme, bookmakers will be allowed to accept bets on horse racing only if they have acquired the right to do so by agreeing to pay a fixed proportion of their profits to the sport.
5.21pm GMT
Here’s a nice stamp duty factoid.
Stamp duty was first introduced in 1694 to pay for war with France...
5.16pm GMT
George Osborne was keen today to contrast Britain’s strong growth this year with the lacklustre performances of Germany and France.
But take a look at productivity growth, and its clear that the eurozone’s two biggest members have outshone the UK. Indeed, only Italy -- which hasn’t grown for the last 12 quarters -- has done worse:
Ultimately manufacturers would have liked to have seen greater levels of funding and longer- term commitments to spending on innovation.”
5.01pm GMT
The autumn statement has acted like a crowbar in the fractures that run through the coalition.
The extraordinary intervention – emerging in the aftermath of the autumn statement given by George Osborne – represents an attempt by the business secretary to assert the independence of Liberal Democrat economic policymaking after more than four years of coalition government.
Cable – who remains a member of the cabinet – wrote to the OBR in the past two weeks; his letter as well as a reply from the OBR is due to be published shortly.
If Vince Cable doesn't agree with what the government's doing, fine. He should leave it.
Extraordinarily the Business Sectretary @vincecable has written to OBR asking for a special libdem forecast on impact of further cuts
4.59pm GMT
Ed Balls, the shadow chancellor, has been briefing journalists at Westminster on the autumn statement. Here are some of the key points he’s been making.
Once you concede that the top end of the housing market is under-taxed, it is not clear why you would only choose a tax on transactions that only applies on transfers.
It’s not there. It does not exist. It’s a con ... It is very hard to spend a prospective underspend. How can you know the department is going to underspend in the future?
4.41pm GMT
Ian Stewart, chief economist at Deloitte, hammers home the point that Britain is only halfway through its austerity programme.
Despite disappointing growth in revenues today’s deficit forecasts weren’t quite as bad as some feared. But that shouldn’t obscure the fact that we are only half way through a deficit reduction programme which stretches towards the end of the next Parliament.
The IMF reckons that the UK deficit this year will be larger those in Greece, France, Italy or Ireland. The OBR is forecasting a tightening of fiscal policy and cuts in real government consumption spending for each of the next five years. The private sector will have to compensate for this and drive UK growth through the next Parliament.”
OBR: Govt's fiscal plans imply 3 successive yrs of cash reductions in govt consumption of goods/services from 2016 onwards, first since 1948
4.39pm GMT
Video: Here’s David Cameron’s bungled attempt to accuse Ed Balls of political sado-masochism at PMQs today:
4.18pm GMT
We’ve already mentioned the OBR’s comment about the government saving money from the universal credit delays (see 3.37pm), but this is worth a mention because it is a wonderful addition to the lexicon of Whitehall euphemism.
The OBR accuses the DWP of “optimism bias”.
We have considered the evidence on the centrality of these plans – including the cross- government scrutiny that has taken place – and have weighed that against the recent history of optimism bias in universal credit plans and other projects of this sort.
4.16pm GMT
George Osborne has also given a helping hand to buy-to-let landlords with his stamp duty plans.
That’s according to Stephen Ludlow, chairman of estate agent ludlowthompson, who explains:
“Buy-to-let landlords usually invest in properties below £937,500, so the changes will give almost all investors in this market a boost.”
“The changes in stamp duty will see the biggest increase in net returns for more modestly investments – smaller properties in Zone 3 of London, city centre apartments, flats above shops, ex-local authority property and property in secondary locations.”
4.09pm GMT
George Osborne actually paid tribute to Gordon Brown as he took questions in the Commons on his statement, according to the Press Association. Osborne was replying to a question from Kenneth Clarke, who said Ed Balls was not as committed to financial discipline as Brown was when he was in opposition. Osborne replied:
You of course make a good observation about the shadow chancellor’s career and I think it is probably the first time I’ve ever done this but I should pay tribute to Mr Brown who has announced his retirement this week, firstly for his commitment to something I totally support which [is the] advance of international development and the commitment to British aid.
The second - when he was shadow chancellor he built up a really compelling case for fiscal discipline and that’s why the Labour Party won the 1997 general election in part. It is in such a marked contrast to the shambles we see from the pair opposite who subsequently advised him.
4.06pm GMT
Slightly alarmingly, the OBR ends its briefing by admitting that it’s not certain that UK productivity will recover; economist Stephen Nickell says it’s an ‘act of faith’.
Obr briefing ends with assertion that the hope productivity growth will return and boost wage growth is an "act of faith" from obr's Nickell
4.02pm GMT
The Lib Dems have pointed out that George Osborne’s stamp duty reforms are in line with longstanding Lib Dem policy. As you will all remember, policy paper 81, passed at the Lib Dem conference in 2007, said the regressive “slab” structure of stamp duty should be reformed. AS
3.57pm GMT
This chart for the OBR’s economic and fiscal outlook shows how the stamp duty changes will cost around £800m per annum:
@KatieAllenGdn @graemewearden £395m hit to the government coffers for the next four months alone. Ouch!
3.55pm GMT
In his speech George Osborne said the richest 20% were contributing more to the government’s deficit reduction programme than everyone else put together.
The net contribution of the richest 20% will be larger than the remaining 80% put together – proving we are all in this together.
3.51pm GMT
OBR chief Robert Chote has predicted that the stamp duty reforms will push up the cost of less expensive homes, echoing earlier warnings (see 2.58pm onwards)
Obr's Chote: stamp duty change shd boost transactions as net giveaway. Prices should rise for houses where duty cut
3.40pm GMT
wouldn't be an obr briefing without Chote's "flamethrower of uncertainty" on whether govt will meet fiscal mandate pic.twitter.com/jbHmXMN1xR
3.37pm GMT
Back at the OBR press conference, Robert Chote confirms that the delays to rolling out the government’s universal credit will cut spending (as we flagged up earlier).
OBR makes clear that Osborne banking decent savings from further decision to delay Universal Credit- see delay chart pic.twitter.com/TPb47qmIGK
OBR says Govt is saying more than £1 billion over next three years because of "further delays to roll out of Universal Credit" #oops
Compared to previous assumptions the combination of the move to DWP’s preferred profile and our 6-month delay to non-JSA cases has the effect of migrating about 2.2 million fewer people onto universal credit in 2016-17, 2.9 million in 2017-18, and 1.6 million in 2018-19 than in March, leaving some recipients of ESA and tax credits to migrate later.
3.32pm GMT
Here’s a Guardian video with extracts from George Osborne’s speech.
3.30pm GMT
In politics, if your opponents have a good idea, the best option is often to pinch it wholesale. And that is what George Osborne seems to be doing with Labour’s levy on tobacco companies (which Labour announced at the 2014 party conference, and plans to use to help improve the NHS).
Osborne did not mention this in his speech, perhaps because Labour MPs would have jeered at him if he had done. But it’s there, on page 62 of the autumn statement green book. AS
Smoking imposes costs on society, and the government believes it is therefore fair to ask the tobacco industry to make a greater contribution. The government will shortly launch a consultation on introducing a levy on tobacco manufacturers and importers.
3.29pm GMT
If you’re just joining us, you might find this summary helpful:
3.26pm GMT
Confirmation that the deficit will be “up a bit” in the current financial year:
Explaining higher borrowing forecast for uk this year, obr's Chote refers to growth in jobs skewed to low earners pic.twitter.com/e3zzCYin29
3.25pm GMT
Problems in the eurozone are the biggest threat to the recovery:
OBR key risks to its growth outlook, include troubles in eurozone and a failure of productivity to recover in uk pic.twitter.com/2sEhm6pSCW
3.24pm GMT
And my colleague Libby Brooks has sent me some reaction from Scotland.
The SNP’s deputy leader and treasury spokesperson Stewart Hosie MP wasted no time in linking the chancellor’s statement to the argument for more powers for the Scottish parliament, responding: “Austerity has failed. That is why we must have full economic decision making power in Scotland to deliver prosperity with a purpose – to grow the economy and deliver real social justice.”
The Scottish Green party’s co-convenor Patrick Harvie MSP likewise condemned Osborne’s “delusional optimism” about the state of the economy, saying it proved how out of touch Westminster politicians really are.
3.23pm GMT
UK inflation will soon fall below 1%, the OBR says.
BoE governor Carney looks likely to be writing to chancellor soon to explain low inflation. OBR sees infl low of 0.9% early next year
3.22pm GMT
George Osborne has launched a driverless car initiative. My colleague Samuel Gibbs has the details.
The chancellor announced the winning cities for the government’s driverless car funding competition, which will see consortia in Greenwich, Coventry and Milton Keynes and Bristol given the green light to conduct driverless car trials on public roads from 1 January.
The three cities will be awarded up to £19m to conduct the trials, including the original £10m announced in July by the business secretary Vince Cable, and a further £9m from BIS, DfT and the Treasury.
3.20pm GMT
Here’s Natalie Bennett, the Green party leader, on the autumn statement.
The many problems with this autumn statement start with its foundations. Osborne is continuing the demonstrably false claim that our deficit problems can be blamed on government spending and welfare.
But what got us into ‘this mess’ is the fraud, errors and mismanagement of the corrupt and still out-of-control financial sector.
3.19pm GMT
The Office for Budget Responsibility has begun its press conference on the autumn statement.
Its chief, Robert Chote, begins by explaining that the watchdog sees a sharper slowdown next year. And there is major uncertainty over UK productivity and earnings
Obr's Chote says their forecast somewhat weaker than Bank of England for growth as he presents obr outlook pic.twitter.com/i3s3GnBfv2
Obr's Chote: consumer spending still main driver of growth so far this year but biz investment now revised up #AS2014
3.18pm GMT
Phil Aldrick of The Times is also struck by the scale of cuts still to come:
Hidden away in the OBR is another £14.5bn cut in departmental spending in 2019/20. Huge. Is Osborne going to close down the Treasury?
3.17pm GMT
More grim forecasts from the OBR. Towards the back of its report (pdf), from page 147, the OBR tries to assess what the government’s plans mean for public spending over the next five years. It says 60% of the cuts are yet to come.
The figures imply that roughly 40 per cent of the total implied cut in day-to day public services spending between 2009-10 and 2019-20 will have taken place over this Parliament, with roughly 60 per cent to come in the next. And most of the implied spending cuts in the next Parliament lie beyond the period for which there are currently firm departmental plans.
3.02pm GMT
Duncan Stott, Director of PricedOut - the campaign for affordable house prices – also fears today’s stamp duty changes will inflate house prices.
“A house sold at the current average price of £273,000 will now be liable for £4,540 less stamp duty, but since sellers want to maximise the sale price of their property, they will expect buyers to pay this money to the house instead....
“You have to wonder whether George Osborne is trying to stoke up house prices in advance of next year’s general election.
2.58pm GMT
The changes in stamp duty may drive up house prices.
Professor Michael Ben-Gad of City University in London predicts that sellers will slap a few thousand pounds more on their asking price, now that buyers have more cash to spend .
“The short-run impact is likely to be a rise in house prices, because the immediate supply of housing is inelastic and sellers will pocket most of the tax reduction.
“In the long-run, lower taxation should help spur a bit more house building and so in a few years’ time, buyers may see some benefit. Of course at the very top, there will be an increase, so this is one way of undermining Labour’s mansion tax argument.”
2.58pm GMT
The OBR also said that some of Iain Duncan Smith’s welfare reforms are saving less money than expected.
Ongoing reforms to incapacity and disability benefits are unlikely to save as much money over the next few years as we thought in March, but from 2016-17 the impact is broadly offset by lower expected inflation (which reduces the amount by which most benefits would be uprated) and by another delay to the rollout of universal credit.
2.56pm GMT
And here’s another OBR revelation. It says that public spending, as a percentage of GDP, will fall to its lowest level for 80 years by the end of this decade according to the Treasury’s plans.
Total public spending is now projected to fall to 35.2 per cent of GDP in 2019-20, taking it below the previous post-war lows reached in 1957-58 and 1999-00 to what would probably be its lowest level in 80 years.
2.52pm GMT
Here’s Len McCluskey, the Unite general secretary, on the autumn statement.
The vast majority of people listening to George Osborne talking about an economic recovery will think it’s a figment of his imagination.
This is a phoney recovery, built on dangerous levels of consumer debt that are the highest across Europe, run up as people borrow to get by because his Government’s policies have made people poorer, the rich richer and cut income to the Treasury. Not only are the people worse off since he took office, but so is the nation.
2.50pm GMT
It is a long way ahead, but the autumn statement makes a new assumption for spending in 2019-20. It assumes that total government spending will be frozen that year. In its report, the OBR says this implies a big cut to current spending.
The largest single-year effect of a government decision comes via its new assumption for total spending in 2019 20, although this does not appear in the Treasury’s table of policy decisions. This implies another cut in current spending by central government departments in that year equivalent to £14.5 billion (compared to holding spending flat as a share of potential GDP).
2.48pm GMT
Businesses have generally welcomed the planned review of business rates, with some provisos (Julia Kollewe reports)
The British Property Federation urged that any future changes to the system should not take place purely to help high street retailers to compete with internet outlets, and advised reform should benefit all rate payers, not just a subset of them.
James Lowman, head of the Association of Convenience Stores, chipped in:
“Local shops will welcome the 2% cap on rates increases and the extension of the higher threshold for small business rate relief, alongside the increased £1,500 rates discount for shops on the high street.”
“This iniquitous tax is sapping good companies’ strength year after year, long before they make a single penny in profits.”
2.42pm GMT
As usual with a budget or an autumn statement, some of the most interesting revelations are in the Office for Budget Responsibility’s report (pdf).
Here is one of them,
Meaningful real wage growth is expected to resume in 2015, although the measure of real earnings in our forecast does not return to its pre-crisis level within the next five years.
2.42pm GMT
Estate agent Savills reckons around three quarters of a million home buyers across England will benefit from the stamp duty changes.
Around 17,000 high-end transactions will incur more tax, though.
“In particular, first time buyers and second steppers will find it easier to raise the deposit needed to obtain mortgage finance, removing one of the major hurdles in the current market.
At the other end of the market, we estimate that around £2.2 billion of stamp duty receipts will come from property worth more than £2million. This means that one third of total stamp duty revenues from residential property will be generated by fewer than 5,000 sales - less than half a percent of all transactions.
2.39pm GMT
The TUC, however, are not impressed; general secretary Frances O’Grady fears “eye-watering” cuts after the election:
“Nothing in today’s Autumn Statement will give Britain a pay rise, and Conservative plans to effectively outlaw strikes will help make Britain permanently low-paid. Wrapping up last year’s infrastructure presents and giving them to us again will not give the economy the extra boost it now needs.
“Today should have seen policies for growth, but the Chancellor has boxed himself in with a rigid and artificial deficit reduction timetable. If he continues in office that will mean eye-watering spending cuts straight after the election. These would knock the recovery sideways, deter investment and lead to great damage to our social fabric.
2.37pm GMT
The CEO of Nationwide, the building society, is pleased,
Nationwide has been campaigning for Stamp Duty reform for more than a decade so we are delighted with @George_Osborne’s announcement today
2.35pm GMT
The autumn statement has not rocked sterling, which is hovering around $1.567. That’s is a decent sign that there are few major surprises.
Fiscal policy specifics seldom have a significant effect on currency markets, unless there is something unexpected and drastic announced, but these announcements today were in line with what the market was expecting.
2.33pm GMT
Here are some more statistics on the stamp duty reforms.
People selling homes worth more than £1m will pay an extra £600m. But people selling homes worth less than £1m will gain £1.4bn.
2.30pm GMT
The CBI is reacting positively. This is from John Cridland, it’s director general.
These major changes on stamp duty and business rates will be a shot in the arm for families and growing firms as they look towards 2015.
The targeted focus on enterprise is right, but business innovators would have liked to see more on research and development (R&D) to boost UK investment.
2.26pm GMT
An example of how the stamp duty changes will help some people:
I'm a few days away from exchanging contracts on a flat. Suddenly saved four figures outta nowhere.
2.23pm GMT
John Hawksworth, chief economist at PricewaterhouseCoopers. says:
“Austerity still has at least four more years to run to eliminate the budget deficit. We are in for another Parliament of pain, but there could be light at the end of the tunnel by 2020.”
2.23pm GMT
The stamp duty changes have hit Foxtons, which specialises in high price housing in London and the south.
Its shares are down 6% on worries about the increase in tax on homes over £1.5m.
2.21pm GMT
The stamp duty changes feel like the big news in today’s autumn statement.
The Treasury insists that 98% of households will benefit; the big losers are people paying over £1m for a house:
If you’re buying a home for less than £937,500, you will pay less stamp duty, or the same.
2.15pm GMT
Airline shares are climbing after George Osborne scrapped air passenger duty for children flying out of the country, markets reporter Nick Fletcher explains:
The chancellor abolished the charge for children under 12 from next May and for children under 16 from 2016. The tax costs between £13 and £194 per passenger depending on the flight distance and the class of travel.
The news has lifted British Airways owner International Airlines Group by more than 2% to 470p and easyJet by the same amount to £16.60.
2.11pm GMT
The Office for Budget Responsibility says:
Despite stronger growth, we have revised up our estimate of the budget deficit this year. But the budget is still forecast to be back in balance by 2018-19.
The government is on track to meet its fiscal mandate and the welfare cap, but not its supplementary debt target.
This raises borrowing by £7.8bn in 2014-15, rising to £25.3bn in 2018-19.
1.58pm GMT
Shares in Unilever, GSK and AstraZeneca have all fallen on the chancellor’s announcement of a 25% “Google tax” on multinationals shifting profits out of the UK, our colleague Julia Kollewe flags up.
Neil Shah, director of research at Edison Investment Research, said:
This new multinationals tax, while clearly aimed at catching UK-generated profits from online operators such as Amazon and Google, may have unintended consequences on global manufacturers with UK listings from Unilever to SABMilller to big pharma.
1.57pm GMT
Sky’s business editor Ian King says the growth downgrades from 2016 onwards are “major, major” changes, and a worry.
1.56pm GMT
Blocking European migrants from claiming the jobseeker’s allowance may make good headlines (in some newspapers), but it will only save £15m a year, at most.
Via our datablog editor Alberto Nardelli:
Limiting access to JSA for EU migrants saves a whopping £15m pic.twitter.com/QgTNgMuPl0
1.54pm GMT
Here’s the key table, confirming that Britain will borrow over £91bn to balance the books this year, down from £97.5bn a year ago:
1.49pm GMT
Here’s a link to the autumn statement.
1.47pm GMT
Balls has got his hands on the OBR’s new Economic Outlook.
1.46pm GMT
The stamp duty reform amounts to a tax cut worth £800m, not £800,000, as I posted earlier. That was a mistake. Sorry. AS
1.42pm GMT
My colleague Henry McDonald says George Osborne put a very interesting spin on his offer to let Northern Ireland have control over corporation tax.
One of the very few issues on which the unionist and nationalist parties agree is a regional special rate to match the Irish Republic’s low 12.5% corporation tax rate. The power-sharing executive at Stormont has argued that Northern Ireland cannot compete with the republic in terms of wooing foreign direct investment to the province if corporation tax is double the rate in Belfast that it is in Dublin.
But George Osborne has said there will have to be both legislation in Belfast and negotiation with the UK Treasury if the Northern Ireland assembly votes for a special regional rate close to the republic’s 12.5%.
1.42pm GMT
Balls welcomes the changes to stamp duty (details are here) saying the government has belatedly recognised that owners of the most expensive houses are undertaxed.
But today’s measures aren’t enough – why not have an annual charge on the highest properties [ie a mansion tax], and fund a £2.5bn injection into the health service?
1.39pm GMT
Balls returns to Cameron’s mis-step at PMQs, when the PM said the shadow chancellor referred to “masosadism”.
It means someone who enjoys having pain inflicted on them, and inflecting pain on other people, Balls explains helpfully.
1.38pm GMT
You can see why David Cameron was so excited. Even though home ownership has been going down under this government, this remains a nation where home ownership remains an obsession and Osborne’s stamp duty reforms, which combine a reasonable-sized tax cut with a common sense modification, are bound to get a terrific write-up in the papers tomorrow. Holding the vote tomorrow also means that Labour has just 24 hours to decide whether to support it, although in principle I can’t see why they would necessarily object. Otherwise, it was a substantial package, much of which has been pre-announced over the last three days, with a surprise near the start, when Osborne released the figures on the public finances and claimed the deficit reduction picture was actually rosier than people expected. Whether those claims will survive scrutiny over the next few hours remains to be seen. AS
1.35pm GMT
Ed Balls is welcoming some of the measures in the autumn statement, such as the changes to air passenger duty.
But he’s disappointed that the review on business rates won’t report until 2016.
1.33pm GMT
The shadow chancellor, Ed Balls, responds, saying parliament must check the full details of the OBR’s Economic Outlook to understand the detail of the autumn statement.
He points out that wage growth has been weaker than expected through the last parliament, creating a squeeze on family budgets creating a shortfall on tax revenues.
1.31pm GMT
There’s not too much to cheer in today’s economic forecasts, despite George Osborne’s best efforts to claim a triumph (and the howls of delight from his backbenchers as he sat down)
The underlying picture is still pretty rough, implying another dose of austerity in the next parliament.
So in a nutshell: borrowing this year is £5bn more than was hoped in spring....but still lower than last year at 97bn to 91bn.
1.24pm GMT
Osborne says people said it was impossible to control the public finances, and cut taxes.
But you can do it if you have a long-term economic plan, he says.
1.18pm GMT
Osborne turns to tax.
1.17pm GMT
1.16pm GMT
Osborne confirms that he will scrap the tax on people who pass annuities on to their children.
Details of the new pensioner bond will be announced in January.
1.15pm GMT
Osborne says he will respect the devolution settlement.
1.13pm GMT
The cuts to air passenger duty are pushing up shares in airlines - easyJet has gained 2%, and British Airlines’ parent company IAG is up 1.1%.
This is a bad autumn statement for carbon usage: air passenger duty down and fuel duty frozen #as2014
1.13pm GMT
Osborne says there will also be a major new theatre space in Manchester.
It will be called The Factory, Manchester. Anyone who’s a child of the 1980s will support that.
1.12pm GMT
Osborne mentions his “northern powerhouse” vision and says he is tendering for new carriages for the Trans-pennine Express and for Northern Rail.
1.11pm GMT
Osborne says Britain was yesterday awarded a lead role in exploring Mars.
We on this side have often gazed on the barren waste of the red planet, he says. We have given up hope of finding intelligent life there. But signs of any life at all would be an advance, he jokes.
1.10pm GMT
Osborne says science is a personal priority.
Science is crucial to the economic future, he says.
1.08pm GMT
Osborne turns to fuel duty.
1.07pm GMT
1.05pm GMT
Osborne says tax breaks have introduced a golden age for the creative industires.
1.04pm GMT
Osborne turns to bank tax.
1.01pm GMT
Our datablog team explain why the original 2010 target of eliminating the deficit this parliament has been missed:
1.00pm GMT
Osborne says he is turning from those who pay too much tax to those who pay too little.
12.59pm GMT
Osborne says the end of military operations in Afghanistan is saving the Treasury £200m this year.
The inheritance tax exemption will be extended to aid workers who lose their lives in emergencies.
12.57pm GMT
Osborne says the OBR forecast will show net payments to the EU falling this year, next year and over the next five years.
12.57pm GMT
12.57pm GMT
Osborne says crime is down, and satisfaction with local government services is up.
That shows that budgets can be cut, he says.
12.56pm GMT
The weak inflation predicted by the OBR should help wages rise faster than prices through the decade:
‘The @OBR_UK predict that meaningful real wage growth will pick up through next year and grow above inflation for the next 5 years’ #AS2014
12.54pm GMT
Osborne says he will be spending £10bn less this year than in his original spending plans.
Some of that underspend will go into the NHS. That will be an extra £2bn a year.
12.53pm GMT
So that is not what the mystery vote tomorrow night will be about.
12.52pm GMT
Ladbrokes will be paying out to anyone who bet that Osborne would say “long-term economic plan”. It’s working, the chancellor says.
So, those City economists who reckoned the deficit targets would slip by a year were too pessimistic, but we’ll need to scrutinise the OBR’s report for full details....
Brilliantly confusing from Osborne dancing through those numbers... Must always wait till we get the actual numbers
12.52pm GMT
Osborne address the question why the public finances are better than expected.
Tax receipts are lower than expected, he says.
12.51pm GMT
Osborne turns to debt.
He says it is coming down faster than forecast.
12.48pm GMT
Osborne turns to the deficit.
Borrowing is falling, he says.
12.45pm GMT
Osborne says the OBR predicts that “meaningful real wage growth” will pick up next year and then continue, above inflation, for five years.
The OBR has revised down its inflation forecast, he says.
12.45pm GMT
*U.K. 2015 GDP GROWTH FORECAST REVISED TO 2.4% FROM 2.3%
12.44pm GMT
Osborne says the OBR has revised down its unemployment forecasts.
For every day this government has been in office, 1,000 new jobs have been created.
Britain’s long-term economic plan is working.
That is progressive politics in action.
12.42pm GMT
Osborne turns to the UK growth forecasts.
12.40pm GMT
12.40pm GMT
Osborne turns to the future.
The warning lights are flashing, he says.
12.39pm GMT
Osborne says he backs aspiration.
Turning to the OBR’s report, he says new statistical standards have changed the assessement of the economy.
12.38pm GMT
Osborne says the deficit is still too high.
12.37pm GMT
12.37pm GMT
Osborne says growth is higher, unemployment is falling, inflation is down and the deficit is being cut.
The choice is whether to stay the course, or squander this. Osborne says he says stay the course.
12.36pm GMT
Five minutes late, George Osborne is starting.
He says four years ago he presented the accounts of an economy in crisis.
12.34pm GMT
Is this George Osborne telling the Speaker to get on with it?
It's time for the #AutumnStatement
12.32pm GMT
It turns out that masosadism really does exist - at least according to the urban dictionary. Perhaps David Cameron is more racy than we realise. AS
12.29pm GMT
Labour’s Nic Dakin asks Cameron why the government has failed on immigration and the deficit.
Cameron says Labour left the coalition with a huge problem, and is now complaining it has not been cleared up quickly enough.
12.28pm GMT
David Cameron set the tone for today’s autumn statement a fortnight ago, when he warned that red warning lights were flashing over the global economy.
We’re about to find out if the Office for Budget Responsibility agrees, as Newsnight’s Duncan Weldon points out:
Couple of things to watch out for today: OBR forecasts for inflation - should be lower and their crucial estimate of the output gap.
Also worth looking to see how the OBR revise their estimates of world economic growth. How bright are the warning lights flashing?
12.27pm GMT
George Osborne reading and re-hearsing lines from his #autumnstatement speech during #pmqs
12.27pm GMT
Labour’s Chris Bryant thinks something is wrong with George Osborne.
George Osborne actually looks unwell.
12.25pm GMT
Labour’s Dennis Skinner asks if Cameron is proud of the fact that he has added £430bn to the national debt, which is more than all the Labour chancellors this century. (I think he meant last century.) You can’t blame Labour for that.
Oh yes I can, says Cameron. The coalition inherited a failing economy, he says.
12.23pm GMT
Cameron says Labour MPs are now suddenly interested in the deficit. The government took tough decisions, cutting some departments by 20%. Labour opposed them all, he says.
12.23pm GMT
David Cameron’s hint about good news in the autumn statement has given the pound a teensy nudge higher, traders say. Sterling is now up 0.2% against the US dollar, at $1.567 - only a small move. GW
Cable trading session highs (1.5670) in anticipation of the #AutumnStatement ... slight tick higher on Camerons hint on deficit
12.22pm GMT
Labour’s Mary Glindon asks why the government is borrowing £4bn more than last year.
Cameron says that is because of the mess left by Labour.
12.17pm GMT
Snap PMQs verdict: More interesting than usual, and Ed Miliband’s anthology of broken Cameron promises was rather effective. It was also telling how Miliband presented these not simply as broken promises, but as sincerity indicators (Did he mean it?). There is a difference between lying and breaking a promise, and Miliband is trying to brand Cameron as a liar. But by the end of the day these exchanges will be forgotten, apart, perhaps, from Cameron’s intriguing teaser, about how the autumn statement will leave Miliband looking as awkward as he was eating that bacon sandwich. I’ve never heard quite such a cocky pre-budget (or autumn statement) boast from the despatch box. AS
12.16pm GMT
Big hint by @David_Cameron that deficit forecast miss this year could be balanced by improved forecasts for coming years. #AutumnStatement
12.12pm GMT
Miliband says Cameron has been visiting the David Mellor school of charm. What about Cameron’s promise on the deficit. He said he would balance the books in five years’ time. Did he mean it?
Cameron says the deficit is down by a third. He won’t reveal what is in the autumn statement. But he in a moment or two, Miliband will be looking as awkward as when he ate that bacon sandwich.
12.11pm GMT
PM is boasting about the economic numbers.... Better than expected?
12.09pm GMT
Miliband says Cameron should be admitting that he broke his promise. And what did Cameron say to a nurses conference before the election. There will be “no more of those pointless reorganisations”, Cameron said. Did Cameron mean that?
Cameron says there are more doctors, more nurses and more patients treated. He says he has a list of Miliband’s promises.
12.06pm GMT
Ed Miliband says Cameron said earlier this year: “Woe betide the politician who makes big promises and than says I did not mean it.” Has he done that?
Cameron says he has kept his promise to get unemployment down, and make Britain a good place to do business.
12.03pm GMT
12.03pm GMT
Labour’s Robert Flello says Cameron promised to balance the books by 2015. But the deficit has barely been touched. Doesn’t the country need a Labour government?
Cameron says the deficit is down by a third, because the government has taken tough decisions. All of those were opposed by Labour, he says.
12.01pm GMT
PMQs has started.
12.00pm GMT
The Treasury seems to be firming up the stamp duty reform story.
Could soon be cheaper to buy a cheaper house & more expensive to buy a pricier one as @George_Osborne looks set to reform stamp duty
Looks like Stamp duty reform will indeed be Osborne's Autumn Statement rabbit to shoot Labour’s Mansion Tax fox. @GeorgeWParker's top scoop.
11.57am GMT
It’s also PMQs today, of course.
I won’t be covering the whole thing as I usually do, but I will cover the exchanges between David Cameron and Ed Miliband, and any autumn statement-related questions.
11.54am GMT
Dave Prentis, general secretary of Unison, is urging George Osborne to offer ordinary workers some respite:
People simply can’t afford to live on their wages and many have had to borrow more and get second jobs to make ends meet - people working round the clock to ensure they can keep their homes, pay their bills and feed their families.
UNISON Gen Sec says #AutumnStatement is #Osborne's last chance to ditch #austerity: http://t.co/g3LPhZjQHy #AS2014 pic.twitter.com/XHUpy8CxBa
11.53am GMT
William Hague, the leader of the Commons, is making a business statement after the autumn statement.
That will, presumably, clear up the mystery about the vote that has been timetabled for tomorrow evening.
11.49am GMT
The Child Poverty Action Group is predicting one topic that won’t be in the autumn statement.
#AutumnStatement starts soon - hasn't included a mention of child poverty since 2012 http://t.co/hvQwAdut47
11.45am GMT
One note of caution, the deficit figures in today’s autumn statement probably won’t be directly comparable to the numbers in March’s budget.
Britain changed the way it calculates the public finances this summer, to meet international standards, as Scotiabank explains here:
Autumn statement warning: definition of PSNB / deficit changed in September & not comparable to Budget. Scotiabank: pic.twitter.com/qOi3CMpte6
11.44am GMT
Sky’s Faisal Islam is complaining about the size of the temporary BBC autumn statement studio on Abingdon Green, outside the Houses of Parliament.
state broadcaster has built a giant spaceship at front of parliament... Blocking views, casting large shadow pic.twitter.com/XrDPWTabuu
11.37am GMT
Here’s the BBC’s Robin Brant on George Osborne as he headed for his car.
osbo departs HMT for commons. instant analysis of face: no smile, sombre look, warning lights on the dashboard etc #autumnstatement
George Osborne looks cold walking to his car. That's because it's NOT AUTUMN #AutumnStatement
11.34am GMT
The chancellor has just left the Treasury and boarded his government car for the short drive to the House of Commons. No trace of a smile....
11.33am GMT
Labour’s Stewart Wood has given a Christmas flavour to his autumn statement tweeting.
Somewhere in the Westminster ether today you'll hear the Ghost of Osborne Past whispering: "It's all about wiping out the deficit by 2015".
11.28am GMT
The Evening Standard has picked up on the reports that George Osborne is going to reform stamp duty in the autumn statement. (See 9.20am.)
The chancellor was expected to make the tax on homebuyers slightly fairer by smoothing the “cliff edge” effect of sudden increases when prices go into new bands.
He may even reduce stamp duty for cheaper homes, but experts think few properties in London would be priced low enough to qualify.
11.24am GMT
Sterling is already hovering near a 15-month low, and could come under pressure today if the borrowing figures in the autumn statement disappoints the City.
Joe Bond of broker Abshire Smith reckons:
During the speech any unexpected announcements could move the pound.
The statement needs to be business and deficit friendly to benefit the pound.
11.19am GMT
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