Brexit is casting a "cloud of uncertainty" over the British economy, Philip Hammond admitted, after MPs rejected Theresa May's deal and the Budget watchdog slashed growth forecasts.

The Chancellor said the Office for Budget Responsibility (OBR) has forecast growth of 1.2% this year - a downgrade from the 1.6% forecast at the Budget in 2018.

Mr Hammond also announced measures on knife crime, period poverty and regulation of tech giants in a swift statement to MPs.

What were the headline announcements?

ITV News Business and Economics Editor Joel Hills and ITV News Political Correspondent Paul Brand kept across the key lines.

  • Long-term growth gain after short-term pain

The OBR cut its forecast growth of 1.2% this year, 1.4% next year and 1.6% in the following three years.

Mr Hammond said: "Cumulative growth over the five years is now slightly higher than the Budget forecast."

The OBR expects to see 600,000 new jobs by 2023, with wage growth at 3% or higher in each year of the forecast period.

Borrowing this year will be 1.1% of GDP - £3 billion lower than forecast at the Autumn Budget.

Borrowing will be £29.3 billion in 2019/20, then £21.2 billion, £17.6 billion and £14.4 billion in the following years to reach £13.5 billion in 2023/24 - its lowest level in 22 years.

  • Tech regulation

  • 'Period poverty'

The Government will fund free sanitary products in secondary schools and colleges in England from the next school year.

  • Knife crime funding

Funding totalling an additional £100 million is to be made available immediately to police forces in England to pay for additional overtime targeted on knife crime and new Violent Crime Reduction Units.

  • Other key measures

Mr Hammond announced up to £260 million for the Borderlands Growth deal covering the border regions of England and Scotland, and said negotiations are progressing on future deals for mid-Wales and Derry/Londonderry.

A £700 million package of reforms to help small businesses take on more apprentices, announced in the Autumn Budget, is to be brought forward to the start of the new financial year in April.

From June, the UK will begin to abolish the requirement for paper landing cards at points of entry to the country and will allow citizens of the USA, Australia, New Zealand, Canada, Japan, Singapore and South Korea to use e-gates at airports and Eurostar terminals.

Mr Hammond announced a new £3 billion Affordable Homes Guarantee scheme to support delivery of around 30,000 affordable homes and £717 million from the Housing Infrastructure Fund to unlock up to 37,000 new homes on sites in west London, Cheshire, Didcot and Cambridge.

What did the chancellor say about the Brexit effect?

Philip Hammond urged MPs to deliver certainty in the Brexit process. Credit: PA

The chancellor was keen to defend the strength of the economy amid the uncertainty of Brexit - and offer a roadmap to avoid a no-deal departure.

Delivering his Spring Statement, Mr Hammond told MPs: "Last night's vote leaves a cloud of uncertainty hanging over our economy.

"And our most urgent task in this House is to lift that uncertainty."

But he insisted the economy remained "remarkably robust".

He went on to insist Britain's withdrawal from the EU could provide an economic boost.

Why was the statement so short?

Prior to the announcement, The Treasury insisted the statement was no longer a “fiscal event” after Mr Hammond shifted the Budget from its traditional springtime slot to the autumn.

It was not, therefore, expected to contain major spending announcements or tax changes.

What was the response?

John McDonnell said downgrading forecasts were a

Labour's shadow chancellor John McDonnell accused his rival of a "toxic mix of callous complacency over austerity and its grotesque incompetence over the handling of Brexit".

He said: "Whilst teachers are having to pay for the materials their pupils need, working parents are struggling to manage as school close early, their children are sent home, 5,000 of our fellow citizens will be sleeping in the cold and wet on the streets tonight.

"Young people are being stabbed to death in rising numbers. And the Chancellor turns up today with no real end or reversal of austerity and to threaten us because this is what he means that austerity can only end if we accept this Government's bad deal over Brexit."

Mr McDonnell said downgrading forecasts were a "pattern" under Mr Hammond before he criticised Government borrowing.

He added: "On the deficit, he's boasting about the deficit - he's not eliminated the deficit as we were promised by 2015.

"He's simply shifted it on to the shoulders of headteachers, NHS managers, local councillors and police commissioners and, worst of all, onto the backs of many of the poorest in our society.

"The consequences are stark - infant mortality has increased, life-expectancy has reduced, and our communities are less safe."

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