Hunt has turned to childcare now.

He says he will pilot incentive payments of £600 for childminders joining the profession - £1200 if they join through an agency.

He'll increase the funding to nurseries £204m from this September rising to £288m next year - an average of 30% increase in the two-year-old rate.

The minimum staff to child ratio will change from 1:4 to 1:5 for two-year-olds in England, though this will remain optional.

Hunt says he will increase the pensions annual tax-free allowance from £40,000 to £60,000 and will abolish the Lifetime Allowance - previously set at £1.07m.

Hunt now turns to people who are on Universal Credit without a health condition and looking for work.

He says sanctions will be applied more rigorously to those who fail to meet strict work-search requirements or choose not to take up a reasonable job offer.

For those working low hours, he says the Administrative Earnings Threshold will rise from the equivalent of 15 hours to 18 hours at National Living Wage.

Government to offer "Returnerships" to operate alongside skills boot camps and sector-based work academies "targeted at the over 50s who want to return to work".

The government will also increase the number of 50+ Universal Credit claimants who receive mid-life MOTs from 8,000 to 40,000 a year.

So called mid-life MOTs looks at a person's "finances, skills and health, and enables them to better prepare for their retirement and build financial resilience".

Hunt has now turned to barriers to people participating in the workforce.

The chancellor says a white paper is being published today on disability benefits, including plans to abolish the work capabilty assessment and to separate benefits entitlement from an individual’s ability to work.

As a result, he says, disabled benefit claimants will always be able to seek work without fear of losing financial support.

He says there will be new, voluntary employment scheme for disabled people where the government will spend up to £4,000 per person to help them find appropriate jobs and put in place the support they need. It will fund 50,000 places every single year, he says.

Jeremy Hunt allocated £400m in funding to increase the availability of mental health and musculoskeletal resources for workers.

Jeremy Hunt announces there will be a prize worth £1m every year, for the next 10 years, "to the person or team that does the most ground-breaking AI research".

How can economy avoid a recession and still shrink?published at 13:12 Greenwich Mean Time 15 March 2023

13:12 GMT 15 March 2023

Robert Cuffe
Head of statistics

The chancellor has announced that the economy will avoid a “technical recession” this year, but that doesn’t mean we’re out of the woods.

The size of the economy – the value of everything we make and produce this year – is set to fall by about 0.2% according to the chancellor’s figures.

It becomes a "technical recession" if the economy shrinks for two seasons (three-month periods) in a row. So it’s possible to avoid the technical definition even if the economy is doing badly if it shrinks in the spring and autumn but rises in the summer.

A forecast of a 0.2% shrinkage may be better than we thought last autumn (shrinking by 1.4%) but it’s hardly anyone’s definition of doing well.

Image source, .

Nuclear power will be classed as “environmentally sustainable” which will give it access to the same investment incentives as renewable energy.

He also launches "Great British Nuclear" aimed at bringing down the costs of producing nuclear power.

He says he is launching a competition for small modular reactors - and says the government will co-fund the technology if it is found to be viable.

The chancellor has now turned to measures to reduce the carbon emissions that contribute to climate change.

"I am allocating up to £20bn of support for the early development of carbon, capture, usage and storage, starting with projects from our East Coast to Merseyside to North Wales.

He says this will support up to 50,000 jobs, attract private sector investment and help capture 20-30 million tonnes of CO2 per year by 2030.

He also says he will extend the Climate Change Agreement scheme for two years to allow eligible businesses £60m of tax relief on energy efficiency measures.

Hunt says many MPs have campaigned for better local transport infrastructure, which he's decided to act on.

He announces a second round of the city region sustainable transport settlements, external, allocating £8.8bn over next five-year funding period.

On top of this, to many cheers in the chamber, he says he'll increase funding to help local communities tackle the problem of potholes. The cause will get a further £200m from next year, Hunt says.

Hunt says the government will invest £200m in local regeneration projects around England.

He also lays out a further £161m for mayoral combined authorities and Greater London, while £400m will be available for new "levelling up partnerships" in areas like Redcar, Cleveland and Blackburn.

The chancellor announces an additional £320m funding for the Scottish government, £180m for the Welsh government and £130m for the Northern Ireland executive.

On top he announces up to £8.6m of targeted funding for the Edinburgh Festivals and £1.5m to repair the Cloddach Bridge.

Also, £20m to restore the Holyhead Breakwater in Wales, and in Northern Ireland up to £3m to extend the Tackling Paramilitarism Programme and up to £40m to extend participation in further and higher education.

Small or medium-sized businesses will be able to claim a credit worth £27 for every £100 they spend if they spends 40% or more of their total expenditure on Research and Development, says the chancellor,

For smaller businesses we have increased the Annual Investment Allowance to £1m, meaning 99% of all businesses can deduct the full value of all their investment from that year’s taxable profits, Hunt says.

He says he's also introducing "full expensing", which for the next three years, with an intention to make it permanent as soon as we can responsibly do so.

He says it means that every single pound a company invests in IT equipment, plant or machinery can be deducted in full and immediately from taxable profits.

Corporation tax for businesses is to increase from 19% to 25%, as planned.

Firms which make a profit of more than £250,000 will pay 25% tax on their profits from April.

Hunt says only 10% of companies will pay the full 25% rate.

Hunt highlights the successes of the UK in recent years.

He states that declinists are "wrong about our country", highlighting the "strength" the UK has got in new industries under successive Conservative governments.

He says the UK is the best place in Europe to do business and invest, apart form in the US and China.

He goes onto list the successes of the tech economy and life sciences sectors that created a Covid vaccine; the fact that the UK's film and TV industry has become the largest in Europe; the advanced manufacturing industries' dominance in producing aircraft wings; and the UK being a "world leader" in off-shore wind.

Hunt announces 12 new Investment Zones.

They will be spread across the West Midlands, Greater Manchester, the North East, South Yorkshire, West Yorkshire, East Midlands, Teesside and Liverpool.

There will also be at least one in each of Scotland, Wales and Northern Ireland.

Hunt says he confirms he government will add a total of £11bn to our defence budget over the next five years and it will be nearly 2.25% of GDP by 2025.

"We were the first large European country to commit to 2% of GDP for defence and will raise that to 2.5% as soon as fiscal and economic circumstances allow," he says.

On veterans, Hunt says he's today increasing support for ex-servicemen and women.

A package worth £30m will increase the Budget of the Office for Veterans' Affairs, he says.

Hunt turns to the forecasts for economic growth.

"After this year the UK economy will grow in every single year of the forecast period: by 1.8% in 2024; 2.5% in 2025; 2.1% in 2026; and 1.9% in 2027."

The chancellor offers more details on the OBR forecasts.

He says the economy will actually contract this year - but will avoid a technical recession (which is two consecutive quarters of decline).

Last November at the Autumn Statement, the OBR said the UK economy would shrink by 1.4% this year and would subsequently return to growth in the following years - so a contraction of 0.2% means things are looking better than they were.

The OBR is an independent forecaster which looks at the government’s tax and spending plans before a Budget or Autumn Statement then predicts how the economy will perform.