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  1. ITV Report

Chancellor to set out 'upbeat' Budget ahead of Brexit

The Chancellor will say that he is ready to take further Credit: PA

Philip Hammond is expected to deliver an "upbeat" message in his first Budget as Britain heads towards Brexit.

The Chancellor will admit there is more austerity in the pipeline as he battles to get the deficit down.

Mr Hammond will say he is ready to take further "difficult decisions" on tax hikes and spending cuts to balance the books.

But he will insist the Government's economic programme is laying the foundations for a "stronger, fairer, better Britain" outside the EU.

What can you expect to see in the Budget?

  • NHS and social care
Mr Hammond is reported to be preparing to announce an additional £1 billion for social care Credit: PA

Mr Hammond is reported to be preparing to announce an additional £1 billion for social care in England over the next two years, but is expected to resist demands from Labour and the British Medical Association for a large cash injection for the NHS.

It is thought ministers will argue that creating extra social care places will help to ease the pressures on the NHS, ensuring vulnerable patients can be discharged more quickly once they have been treated, freeing up hospital beds.

At the same time it is expected that Mr Hammond will herald a wider reform of the way the needs of the elderly are funded in a rapidly-ageing population.

  • Brexit
Mr Hammond has made clear his priority was to build up a war-chest for Brexit. Credit: PA

Speaking at the weekend, Mr Hammond made clear his priority was to build up a war-chest to deal with the uncertainties surrounding Brexit, saying he wanted to ensure there was enough "gas in the tank" for the coming years.

The potential for turbulence was underlined by the OECD which - despite raising its UK growth forecast for this year - left its prediction that it will fall back to just 1% in 2018 unchanged.

"UK growth is expected to ease further as rising inflation weighs on real incomes and consumption, and business investment weakens amidst uncertainty about the United Kingdom's future trading relations with its partners," the OECD said.

  • Taxes
The Chancellor is considering tax rises Credit: PA

Mr Hammond is said to have been considering increasing raising the national insurance class 4 rate, paid by the self-employed, by 3p in the pound, bringing it in line with the 12% tax rate paid by employees, which could bring in about £1 billion.

  • Motorists
Diesel cars are now considered to be highly polluting Credit: PA

Car bosses say a diesel scrappage scheme will not feature in the Chancellor's first Budget despite growing speculation.

Campaigners have called on the Government to incentivise owners to give up their motors in favour of greener models to help cut pollution.

But industry chiefs say they have not been consulted about such a move and believe it is "highly unlikely" to feature in Mr Hammond's statement.

  • Cigarettes and alcohol
There could be rises in alcohol duty Credit: PA

There could be increases in duty on cigarettes and alcohol.

  • Education

Mr Hammond has already set out plans for £500 million of additional spending on schools in England, with £320 million for 140 new free schools - including new grammar schools promised by Theresa May.

  • Technology
The Toyota prototype Concept-i, a self-driving car with artificial intelligence Credit: PA

There will be a further £500 million to boost science and innovation with support for electric vehicles, robotics and artificial intelligence.

  • Business

Ministers have already indicated there will be measures in the Budget to mitigate the impact on firms facing large rises in business rates as a result of the latest revaluation.

While the Government argues the majority of companies will see their rates fall or remain unchanged, the Institute for Fiscal Studies has estimated firms in London will see an average rise of 11%, taking £800 million a year out of the capital.

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