Budget 2023 live: Jeremy Hunt announces 30 hours of free childcare and extends energy bill support

Part of Jeremy Hunt's speech has been released ahead of tomorrow's Budget. The Chancellor is expected to reference the "difficult decisions" he made in November, before describing today's statement as a "Budget for growth".

He will say: "Not just growth from emerging out of a downturn. But long term, sustainable, healthy growth that pays for our NHS and schools, finds good jobs for young people, provides a safety net for older people… all whilst making our country one of the most prosperous in the world.”

Hunt will promise a growth plan that will remove “the obstacles that stop businesses investing” while also “tackling the labour shortages that stop them recruiting” and “breaking down the barriers that stop people working”.

Labour's Shadow Chancellor Rachel Reeves has released a comment ahead of tomorrow's Budget.

She said: "This Budget is an opportunity for the government to get us off their path of managed decline.

 “It's a chance for them to recognise the huge promise and potential of Britain and get us growing again.

 “With 13 years of economic mismanagement and sticking plaster politics leaving us lagging behind, what we need to see on Wednesday is some real ambition from the government.

 “Labour’s focus would be on our mission to secure the highest growth in the G7. Our plan will help us lead the pack again, by creating good jobs and productivity growth across every part of our country, so everyone, not just a few feel better off.”

Labour has criticised the government’s economic plans, unveiled by Jeremy Hunt in today’s Budget, saying they amount to “sticking plaster politics”, my colleague Ethan Shone reports.

Responding in the Commons, Starmer said that while the economy needed “major surgery”, the Budget “leaves us stuck in the waiting room with only a sticking plaster to hand”. 

He said: “This was a day for ambition, for bringing us together with purpose and intent, for unlocking the pride that is in every community, matching their belief in the possibilities of the future.

“But after today we know the Tory cupboard is as bare as the salad aisle in our supermarket. The lettuces may be out, but the turnips are in. A hopelessly divided party caught between a rock of decline and a hard place at their own economic recklessness. Dressing up stagnation as stability as their expiry date looms ever closer.”

Read Ethan's full piece here.

The free childcare policy unveiled in the government’s Spring Budget is a “smoke and mirrors announcement”, the Mayor of London has told my colleague Imogen Howse.

Sadiq Khan said: "I’m worried that the government has embarked on a smoke and mirrors announcement, instead of providing proper support for families to have affordable childcare, as countries all around the world do.

“When you speak to providers, they say the money they need to do this is £9 million. The government has announced £4 million - which clearly won’t be enough. When you speak to parents, they say the requirements are a real barrier. You see, some people need childcare to get a job - so without that free childcare initially, they can’t get the 16 hours needed to qualify.”

This also becomes an issue for parents trying to change career paths, he added, as they lose access to free childcare while they are not working.

Read Imogen's full interview here.

Parents of children aged under two in the North East have seen an almost 20% increase in childcare fees in the last five years, more than any other region in England, analysis by my colleague Aimee Stanton shows.

In 2022 families in the region were paying £5.02 an hour on average for childcare, up 18.4% on 2018’s figures which were at £4.24, according to figures published by the Department for Education (DfE). Across all childcare providers in England, the average hourly cost was £5.68, a 13% increase on 2018’s figure.

This comes after Jeremy Hunt's signature announcement that free 30 hours of childcare would be expanded to all children under five.

Childcare providers however have previously argued the existing 30-hours scheme is inadequately funded, with the government only covering part of the cost of the ‘free’ places – leaving  nurseries and childminders going bust as they struggle to withstand their losses. NationalWorld has previously revealed how the North East has seen particularly high rates of nursery closures, losing one in 10 early years providers in the year to March 2022.

Read Aimee's full story here.

Smokers are facing a huge hike in the price of cigarettes following a tobacco tax increase in the Spring Budget 2023, my colleague Matt Brooks reports.

Chancellor Jeremy Hunt confirmed cigarette levies will rise in line with the Retail Price Index (RPI) on top of an extra 2% for pre-rolled tobacco products. The RPI rate of 10.1% and the additional tax means prices are set to surge by more than 12%, meaning a packet of cigarettes could cost upwards of £14.

An average pack of 20 cigarettes costs £12.84, according to the latest data from the Office of National Statistics (ONS), meaning a £1.55 increase. There is an additional 6% increase on top of the RPI rate for hand-rolling tobacco, which will see prices rocket by just over 16% after Hunt’s Spring Statement.

Read Matt's full story here.

My colleague Amber Allott has a report on the Office for Budget Responsibility's analysis of the Spring Statement.

OBR chair Richard Hughes said the near-term economic outlook has brightened somewhat, with energy prices and inflation lower than they forecasted back in November. “Both are expected to fall further,” he said.

“This alleviates some of the historic financial squeeze on households and businesses, meaning a shorter and shallower economic downturn over the first half of this year - with GDP falling by just [0.5%], rather than the 2% we expected in November.”

However, the OBR report also found living standards are still expected to fall by the largest amount since records began, although the decline is not as bad as it forecast in November. The OBR said real household disposable income (RHDI) per person was expected to fall by a cumulative 5.7% over the two financial years.

“While this is 1.4 percentage points less than forecast in November, it would still be the largest two-year fall since records began in 1956-57,” the OBR said. “The fall in RHDI per person mainly reflects the rise in the price of energy and other tradable goods of which the UK is a net importer, resulting in inflation being above nominal wage growth.”

This meant that real living standards would still be 0.4% lower than their pre-pandemic levels in 2027- 2028. But they were 0.6% higher than the OBR forecast in November, “thanks to lower market expectations for medium-term gas prices and the upward revision to potential output”.