Rishi Sunak will today declare Britain is ready to enter a ‘new age of optimism’ and a ‘post-Covid’ economy as he is handed a Budget day growth boost.
Official forecasts, set to be updated today, are expected to show the economy is rebounding faster than predicted – allowing the Chancellor to splash more cash.
But the predictions will come with a sting in the tail as the threat of rising prices and worker shortages could put pressure on household finances.
Mr Sunak will hail his Budget as ushering in a ‘new economy’ after the pandemic as he confirms billions of pounds for the NHS and wage rises for millions of workers.
However, he will also stress the need for fiscal responsibility as he reveals a plan for bringing borrowing under control amid concerns about inflation and the threat of interest rate rises.
In the Budget today, Rishi Sunak will declare Britain is ready to enter a 'new age of optimism' and a 'post-Covid' economy. Pictured: Mr Sunak with his pet puppy Nova
During his speech, Mr Sunak is expected to say: ‘Today’s Budget begins the work of preparing for a new economy post-Covid. An economy of higher wages, higher skills and rising productivity of strong public services, vibrant communities and safer streets.
‘An economy fit for a new age of optimism. That is the stronger economy of the future.’
The Office for Budget Responsibility will hand him upbeat forecasts, despite the looming threat of inflation.
The easing of lockdown restrictions and the vaccine rollout mean the economy is in better shape than was expected at the time of the last Budget in March.
Growth forecasts for this year will be revised from 4 per cent to as high as 7.5 per cent – giving Mr Sunak more leeway to pump money into public services as he sets out spending plans for Whitehall departments for three years.
Official forecasts are set to show the economy is rebounding faster than expected - a development that will allow the Chancellor (pictured last month) to splash more cash
Energy bills will shoot up by at least £100 next year – or possibly £200 – because of the failure of suppliers, the boss of British Gas owner Centrica yesterday warned.
A total of 16 energy suppliers have gone bust so far this year because of soaring wholesale gas prices. It has been predicted as many as 20 more will fail in the next few weeks. The price cap on tariffs means that energy companies are paying more for gas and electricity than what they are allowed to charge customers.
Centrica chief executive Chris O’Shea told the House of Lords yesterday that the shortfall would cost ‘every single home in the UK’ £100.
He added: ‘It’s not unreasonable to expect that to double in the next few weeks...’
He will also benefit from improved borrowing numbers. It came as:
÷ Ministers unveiled a new funding model to encourage more British investment in nuclear power stations – squeezing China out but risking higher home energy bills.
÷ Commons Speaker Sir Lindsay Hoyle complained Mr Sunak was treating MPs in a ‘discourteous manner’ by pre-briefing some of his Budget announcements.
÷ Union bosses demanded all public-sector workers should be given inflation-busting pay rises.
÷ It was warned that a new inflation forecast could reduce household incomes by £1,000 next year in real terms.
÷ The Budget is set to include a freeze on fuel duty – but not a cut on VAT on energy bills.
÷ MPs have been urged to wear masks during the Chancellor’s Budget speech by a World Health Organisation Covid expert.
In the Budget today, Mr Sunak will confirm a rise of the minimum wage to £9.50 from April and the end of the pay freeze he imposed on public-sector workers.