Budget sets course for further economic recovery

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March 19, 2014
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March 20, 2014

Budget sets course for further economic recovery

Chancellor George Osborne has set out an upbeat picture of Britain’s economic prospects in his 2014 budget speech but there is no let-up in sight of the spending restrictions brought in by the coalition when it came to power in 2010.

The Office for Budget Responsibility is forecasting growth of 2.7% for this year. A year ago, it predicted growth in 2014 would be 1.8%; six months ago the forecast was 2.4%.

Forecasted growth next year is also revised up to 2.3%, followed by 2.6% in 2016 and 2017.

The OBR also expects Britain to reach the point later this year when the economy is finally larger than before it collapsed six years ago.

However, the caps and cuts on spending remain largely in place to bring down borrowing.

Key budget headlines for the construction industry had already been dished out beforehand.

The Help to Buy equity loan scheme is being extended until 2020.

Long-planned mass housing schemes are promised for the Thames Estuary corridor at Barking Riverside north of the river and a new Garden City at Ebbsfleet to the south.

“We’re going to build 15,000 homes there, put in the infrastructure, set up the development corporation and make it happen,” the chancellor said. “And we will be publishing a prospectus on the future of garden cities.”

He declared: “We’re getting Britain building.”

The chancellor announced that £500m of finance was beng made available to small house-building firms.

Other infrastructure titbits in the budget speech included the previously-announced £270m guarantee for the Mersey Gateway Bridge, an extra £200m for road repairs and an extra £140m for repairs to damaged flood defences. However, local authorities will have to battle like gladiators for a share of the pothole fund.

There will also be legislation to give new tax and borrowing powers to the Welsh government to fund infrastructure.

And the freeze on fuel duty for another year is likely to go down well in the construction industry.

Communities secretary Eric Pickles said of the chancellor's statement: "This year’s budget shows how housebuilding is central to our long-term economic plan, with measures to get Britain building and support to help hard-working people realise their dream of home ownership. Today’s multi-billion package will boost housebuilding, particularly on brownfield land, create new jobs and allow up to an additional 120,000 aspiring homeowners to buy a home.

"The moves will get workers back on site across the country, including at large sites like Ebbsfleet, help smaller builders to restart work on stalled developments, and make sure people who want to build their own home can."






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