Pre Budget Report – Live Blogging

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Starting themes:

- No risk

- Investment in health and education.

Has 'no risk' replaced prudence?

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Forecasts 3% growth - which sounds hard to believe. Then notes it will be 2-2.5% next year. More likely. But then hopes for a rise in 2009. Why is that? When is the election?

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Will make a statement on Northern Rock later this week.

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The 'golden rules' are intact. It sounds so odd to hear somehow other than Brown reading out the data.

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Net borrowing is forecast to fall by 2012. He won't be in the job by then.

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£30 billion of savings have been identified - as I forecast. Asset sales will also release cash.

Expect more tax inspectors to be made redundant.

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Spending will increase from £345 billion now to £397 billion in 2010. That's above inflation as far as I can work out, quickly. At least 3%.

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£400 million extra for defence this year. Mainly for homes for the arms forces.

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It sounds like heavy support for rail and transport

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Tax - competitive, simple and fair.

Three reviews for tax simplification.

Separate payroll will go for some businesses.

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Capital gains - reforms for consistency and competitive. Code of Conduct for Private Equity will be set up next month.

CGT loopholes will be closed. Private equity will be closed.

18% CGT rate from April next year. Flat rate. He completely misses the point. This remains disastrously unfair.

Income shifting will be tackled.

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National Insurance exemptions will be hit.

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On those not paying a fair share - will close loop holes. Non doms pay£4 billion. Change must be fair and affordable.

The £25,000 Tory flat rate will not work. 15,000 would pay. Too low I think.

Repeats the £650 million number - which is wrong. And he says the £25,000 charge would be a disincentive for people to come - which is just wrong.

Will now consult for domicile. A charge after 7 years will be made and a higher rate after 10 years. And will look at remittance rules.

These will raise £650 million. This is of course what he says the Tories would have raised.

He has bottled the issue. He has failed the children of UK who live in poverty.

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Aircraft will be in EU carbon trading scheme. And will now tax flights.

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Environmental transformation fund of more than £1 billion to invest in green technology.

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Aid will increase from £5 billion to £9 billion by 2010. But it must be well spent. I am delighted. But spend some on making sure developing countries can collect their own tax.

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Child poverty - wants to help people into work to tackle this. Incapacity benefit is falling - 100,000 off the list. Increasing child tax credit and other benefits.

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Final points:

a) Inheritance Tax - 100% spouse relief buy no transferability - so will make an allowance of £600,000 by combination of allowances. A gimmick but will massively cut planning.

b) Backdates this for widows and widowers.

c) 97% homes out of Inheritance Tax

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Has £2 billion to spend. Will not put it into the Tories Inheritance Tax limit - but will put money into health and education.

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Education spend will be higher than originally planned - the money will go into personalised support.

NHS will also see a spend increase - 20 new hospitals - 140 GP walk in centres and 100 new GP practices.