Turning to growth, Hunt says you "cannot borrow your way to growth."

"Sound money is the rock on which long term prosperity rests – but it is not enough on its own. Our plan is designed to build a high-wage, high-skill economy that leads to long term prosperity", he says.

Cheap, low carbon, reliable energy must sit at the heart of any modern economy, he says, so contracts will be signed in the coming weeks to get the Sizewell C nuclear plant in the south east of England off the ground.

Sizewell C is expected to provide up to 7% of the UK's total electricity needs, but critics have argued it will be expensive and take years to build.

The plant is not expected to begin generating electricity until the 2030s.

Jeremy Hunt says the plan will create 10,000 jobs and provide power for six million homes for 50 years.

Hunt now talks about the devolved administrations, saying that schools and the NHS in Scotland, Wales and Northern Ireland also face pressure.

To this end, he promises an extra £1.5bn for the Scottish government, £1.2bn for the Welsh government, and £650m for the Northern Ireland Executive.

Hunt says that "efficiency savings alone will not be enough to deliver the services we all need" from the NHS.

He says the NHS budget will be increased in each of the next two years by £3.3bn.

He says the CEO of the NHS, Amanda Pritchard, has told him this should provide sufficient funding for the NHS to fulfil its key priorities.

"That is why today we commit to a record £8bn package for our health and social care system – a Conservative government putting the NHS first," he says.

Hunt goes on to ask the NHS "to join all public services in tackling waste and inefficiency".

"We want Scandinavian quality alongside Singaporean efficiency - both better outcomes for citizens and better value for taxpayers", the chancellor says.

"That doesn't mean asking people on the frontline to work harder, but rather asking challenging questions on how to reform all public services for the better," he adds.

Ione Wells
Political correspondent

There are clear attempts here by the chancellor to avoid some of these political decisions being framed as “tax rises".

Instead, for taxes like income tax and national insurance he is freezing the threshold at which people start paying certain levels of tax.

What this means in practice, though, is that if people’s wages go up but the tax levels stay the same, they may not feel as big an impact from that wage rise.

That's because they're paying more in taxes than they otherwise would have.

Hunt says: "Because we want school standards to continue to rise, we're going to do more than protect the school budget - we'll increase it."

He says in 2023 and 2024 the government will invest an extra £2.3bn in schools.

He says that the government's message to school staff is: "Thank you for your brilliant work... the Conservative government is investing more in the public service that defines all our futures."

Turning to education, Chancellor Jeremy Hunt says "providing our children with a good education is not just an economic mission, it’s a moral mission".

He says the UK has "risen nine places in the global league tables for maths and reading in the past seven years".

He says he is "concerned" that school leaders don't always have the skills they need to enter the workplace.

He says he has appointed Sir Michael Barber as an advisor to work on implementing a "skills reforms programme".

On climate change, the chancellor says the UK has been a global leader by cutting emissions "by more than any G20 country".

"But with the existential vulnerability we face, now would be the wrong time to step back from our international climate responsibilities," he says.

He confirms that the government remains fully committed to the historic Glasgow climate pact agreed at COP26 - including a 68% reduction in emissions by 2030.

Hunt says it will not be possible to maintain the 0.7% target of spending on overseas aid until the economic situation allows.

He says the government remains fully committed to that target, and the plans set out today assume that spending will remain at around 0.5% for the forecast period.

Dharshini David
Economics Correspondent

Taxes as a proportion of our national income will rise by just over 1% over next five years, the chancellor says, as he raises revenues by freezing some tax allowances and thresholds.

But that still means that proportion of income going to the taxman, our tax burden, is likely to be among the highest at least 70 years.

This as households already struggle with the burden of higher prices that aren’t matched by incomes

Image source, .

Simon Jack
Business editor

There's to be a huge increase in windfall taxes.

The increase in the windfall tax to 35% will mean an overall increase in oil and gas companies' tax from 65% to 75% on profits from UK operations. This will last until March 2028, extended from December 2025.

Plus, there'll be a 40% tax on profits of older renewable and nuclear electricity generation.

Together that'll raise £14bn next year alone. That's a big number.

It'll be interesting to see how Labour respond to that.

Hunt says he is committed to helping people raise their income, find work and become financially independent.

To this end, he announces he will ask over 600,000 more people on universal credit people to meet with work coach "so they can get the support they need to increase their work hours or earnings."

Hunt says another £280m will be invested to help the Department of Work and Pensions to crack down on benefit fraud and errors in the next two years.

The government's review on the pension age will also be published in early 2023, he adds.

Jeremy Hunt has confirmed that there will be spending squeezes on government departments. He says that they will have to take "tough decisions to deal with inflationary pressures in the next two years".

He added that overall spending on public services will rise, after accounting for inflation though, for the next five years.

The health budget will be protected though - and the chancellor said a strong NHS was at the heart of the prime minister's vision for the country.

The Chancellor has announced electric vehicles will no longer be exempt from Vehicle Excise Duty from April 2025 to make the motoring tax system "fairer".

Half of cars are predicted to be electric by that point, Hunt said, adding that company car tax rates would remain lower for electric cars.

The income tax personal allowance threshold will be frozen until 2028 the chancellor announces. This means millions of people will end up paying more in tax.

"I am maintaining at current levels the income tax personal allowance, higher rate threshold, main national insurance thresholds and the inheritance tax thresholds for a further two years taking us to April 2028," he says.

Freezing the thresholds means that tax bands will stay the same, even as people’s pay goes up.

So as wages rise, the proportion of earnings that we pay tax on will increase, and more people will move into higher tax brackets. The thresholds were already frozen until 2026.

"Even after that, we will still have the most generous set of tax-free allowances of any G7 country," he says.

Chancellor Jeremy Hunt has confirmed that the energy industry will be hit with an expanded windfall tax of 35% up from 25% from 1 January until March 2028.

"I have no objection to windfall taxes if they are genuinely about windfall profits caused by unexpected increases in energy prices," he says.

"But any such tax should be temporary, not deter investment and recognise the cyclical nature of many energy businesses."

He will also introduce a temporary 45% levy on electricity generators. He says together these taxes will raise £14bn next year.

We're through the scene-setting, and now we're on to the announcements.

First up, the chancellor says the threshold for when the highest earners start paying the top rate of tax will be brought down from £150,000 to £125,140.

"Those earning £150,000 or more will pay just over £1,200 more a year," he says.

On Kwasi Kwarteng's mini-budget, he says he was "correct to identify growth as a priority, but unfunded tax cuts are as risky as unfunded spending, which is why we reversed the planned measures," he says.

"The pound has strengthened and the OBR is saying the government's actions are already benefiting our economy," Hunt says.

Dharshini David
Economics Correspondent

It’s official: with forecasts predicting the economy will shrink by 1.4% next year the chancellor has acknowledged we’re in recession, and things will get worse before they improve.

The chancellor is citing global factors, not least the war in Ukraine which has prompted soaring energy and food costs. But the UK is less well equipped to cope with this kind of shock than some competitors, a period of under investment has left us less efficient and resilient.

We’ll have to check out the fine print. But at first glance, from what we're hearing in the Commons, it sounds like the government’s forecasters reckon we’re in for a relatively shallow but lengthy recession. And that has implications for households across the country. It means living standards, our fortunes, may not fully recover before the end of this Parliament - and if the Bank of England’s separate forecasts are right, unemployment could hit 6.5% - meaning one million more people could be out of work.

Hunt says "British families make sacrifices every day to live within their means, and so to must their government, because the United Kingdom will always pay its way"

He says he understands the motivation of Kwasi Kwarteng's budget, "and he was correct to identify growth as a priority," to laughter from some MPs.