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UK budget seeks to promote faltering growth

 A police officer attempts to remove protesters  preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...
 Britain's Chancellor of the Exchequer George Osborne poses for the media with his traditional red dispatch box outside his official residence at No 1...
 A police officer attempts to remove protesters  preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...
 A police officer attempts to remove protesters  preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...
 Britain's Chancellor of the Exchequer George Osborne poses for the media with his traditional red dispatch box outside his official residence at No 1...

Britain Budget Protest

A police officer attempts to remove protesters preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...

APTOPIX Britain Budget

Britain's Chancellor of the Exchequer George Osborne poses for the media with his traditional red dispatch box outside his official residence at No 1...

Britain Budget Protest

A police officer attempts to remove protesters preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...

Britain Budget Protest

A police officer attempts to remove protesters preventing the car carrying Britain's Chancellor of The Exchequer George Osborne leaving the Treasury...

Britain Budget

Britain's Chancellor of the Exchequer George Osborne poses for the media with his traditional red dispatch box outside his official residence at No 1...

The British government has acknowledged that economic growth will be slower and inflation will be higher this year than previously forecast as it unveiled a tough annual budget on Wednesday.
Amid growing concern about Britain's shaky recovery from its worst recession since the end of World War II, Treasury chief George Osborne attempted to focus on growth-promoting measures to improve Britain's international competitiveness, including a centerpiece 2 percent cut in corporation tax.
"Let it be heard clearly around the world ... that Britain is open for business," Osborne told lawmakers in the House of Commons.
Britain was in recession longer than the other Group of Seven industrialized nations and a shock 0.6 percent contraction in gross domestic product growth in the final quarter of last year has heightened fears for the future.
Osborne said that the Office for Budget Responsibility has downgraded its forecast for gross domestic product growth for 2011 to 1.7 percent, compared with the 2.1 percent it predicted back in November, because of rising commodity prices and the fourth-quarter contraction in GDP.
The agency, created by Osborne last year to keep economic forecasts at arm's length from government, also sharply raised its inflation forecast to between 4 and 5 percent this year, from 3 percent previously.
But there was some good news, with Osborne revealing that government borrowing will come in at 146 billion pounds this year, slightly under the government's target of 148.5 billion pounds.
Osborne and Prime Minister David Cameron have set as their main priority reducing Britain's massive budget deficit over the next few years via harsh government spending cuts.
Osborne first outlined plans in October to slash some 80 billion pounds ($128 billion) of public expenditure over five years, and has already lifted sales tax from 17.5 percent to 20 percent in a bid to raise an extra 13 billion pounds for the country's coffers this year. More painful measures are still to come, including spending cuts on services like welfare and a rise in the retirement age.
The Conservative-led Coalition government has blamed the harsh cuts on excessive spending by the previous Labour government, led by former Prime Minister Gordon Brown.


Updated : 2021-07-27 01:26 GMT+08:00