Today Programme
BBC Radio 4

Today Programme
BBC Radio 4

The Budget stats today might be more interesting than the policies, says Paul Johnston, director of the Institute for Fiscal Studies.

The Office for Budget Responsibility has said "fairly clearly that they are going to really downgrade their view about what's going to happen to productivity in the economy over the next few years."

"The growth of the economy is going to be less than they had previously thought - how much less, we don't know, and how much less is going to be more than anything else what determines the flavour of this Budget," he says.

Image source, PA

Chancellor Philip Hammond will promise investment to make Britain an "outward looking, free-trading nation" once it leaves the EU in 2019, when he makes his second Budget speech, which will begin at about 12:30 GMT,

Mr Hammond will set out proposed tax and spending changes and will also update MPs on the current state of the economy, future growth projections and the health of the public finances.

He is also expected to announce more money for teacher training in England and extra cash to boost the numbers of students taking maths after the age of 16.

Help for small building companies is also likely to be announced while Mr Hammond has already extended the age of the young person's railcard for people aged up to 30.

Today Programme
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Heading into the Budget, one of the issues that really matters to companies is business rates, says Today business presenter Dominic O'Connell.

The tax brings in £26bn a year. But there's been anger about new rateable values, which were issued in April and have left some companies facing very steep increases, he says. And some firms have claimed a new appeals process is cumbersome.

Rowanna John, who owns a jazz cafe under a railway arch in Birmingham, is facing a huge rise in her rates bill.

"Businesses like mine were encouraged to be here. I spent the time and the money, and I really do need it explained to me why suddenly the rates can almost triple," she tells Dominic.

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Scotland's Finance Secretary Derek Mackay wants the chancellor to end the current requirement for Police Scotland and the Scottish Fire and Rescue Service to pay VAT.

The payment was introduced when regional forces were merged to form single, national bodies.

Mr Mackay wants the Treasury to refund the £140m that has been paid out so far.

He also wants Philip Hammond to rethink proposed public spending cuts, and to pause the roll-out of Universal Credit

He added that he hoped Mr Hammond would "halt his £600m reduction for Scotland's railways".

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Julie White of D-Drill says that the construction is grappling with finding the right people for jobs.

"With the skills gap, we lost so many people during the recession - we lost something like as many as the motor industry employ in the whole of Great Britain, so we've got to replace them. But again, finding the right people, and actually, do we invest in apprentices, do we actually go and really get the right people in, or do we have to stay still now with the Brexit?"

Kamal Ahmed
Economics editor

Today business presenter Dominic O'Connell talks to (L-R) Professor Paul Forrest, Birmingham City University; Steve Brittan, managing director of BSA Technologies; and Julie White, managing director of D-Drill.

Image source, GMB

Union activists are planning protests in a final effort to persuade the chancellor to give public sector workers a good pay rise in the Budget.

Members of the GMB union will dress up as "Maybots" as they demonstrate outside Parliament and the nearby Treasury.

Unions have been pressing the Government for months to scrap the cap on the pay of millions of public sector workers.

GMB national officer Rehana Azam said: "Today the chancellor can end seven years of misery for our 5.5 million public sector workers.

"Seven years where they've had their real terms pay slashed, leaving them forced to use food banks while struggling to pay the rent and feed their families."

The construction sector, which is a vital part of the UK economy, is "in a holding pattern" at the moment, says Julie White, managing director of industrial drill firm D-Drill.

"We don't really know what's happening, and I think that's a lot of businesses, especially SMEs - we do not know whether to invest, we do not know whether to employ, because we do not know what's going to happen with Brexit."

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Plans to help the housing market, and especially first-time buyers, are likely to be included in the Budget.

Government figures show that 217,350 new homes were added to the English housing stock in 2016/17 - 27,700 up on the previous year and the highest since the financial crash of 2007/08.

And on Sunday, Chancellor Philip Hammond told BBC One's Andrew Marr Show: "The challenge here is affordability and I think experts generally agree that to start to make inroads on the affordability problem, we have got to be sustainably delivering around 300,000 homes a year on average across the housing cycle.

"That's a big step up from where we are now."

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Would a Budget announcement on housing be an easy win for the economy? Yes, says Professor Forrest.

"It's a big multiplier effect and it washes through the whole economy, so it would be a big increase for the economy over all."

Every pound spent in construction multiplies to about £2.80 in the wider economy, he says.

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Image source, Getty Images

The Office for Budget Responsibility looks like it's going to revise its estimates for productivity, says Professor Paul Forrest.

"According to the official data productivity has been flat since 2010, and really if we're going to get the economy to grow we need to boost productivity," he says.

One way to boost productivity - how much people can produce, or how much value they can add in a job - is to increase spending on infrastructure. Professor Forrest says: "One of the key constraints on productivity in the West Midlands is actually moving your goods around the regional economy because of the problems on the M6..."

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What kind of hand does the Chancellor have to play in the Budget? Professor Paul Forrest of Birmingham City University says Philip Hammond doesn't have that much money to play with "according to his methodology of trying to balance the Budget".

"Public sector debt in net terms is about 80% of GDP, which isn't a horrendous problem - it's difficult, but it looks like he's going to bring the annual balance down to less than 2% of GDP. The problem he's got is that the economy looks like it's slowing."

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The UK has to "deal with productivity" as "the number one issue in the UK", says Nigel Wilson of Legal & General.

"We're 27% behind the French, 35% behind the Germans. We're only going to do that by investing."

To get productivity up we need to invest in infrastructure and businesses, he adds. "We have capitalism without the capital at the moment."

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The UK needs an inspiring Budget and a Cabinet that is not divided to best grow the UK economy, says Nigel Wilson, chief executive of Legal and General.

He says: "What we're looking for from the Budget is the Chancellor inspiring confidence across the UK that this is a really great place to invest."

"There's a collective responsibility to get on with stuff, and stop a lot of of the tittle tattle that's going on in the newspapers about who said what to whom, and actually have a Cabinet that goes on the front foot, and talks about what a great place the UK is to invest."

He would like to see "real things happening in the economy around housing, which we all know has got to happen, around jobs, which we know has got to happen, and just in general: let's invest to grow the UK economy."