By Matt Falloon
LONDON, March 19 (Reuters) - Britain's budget next week will exempt more workers from income tax and use bank levy money to help young people train for jobs, ministers said on Saturday.
The budget, billed as pro-growth and pro-reform, will stick broadly to deficit reduction plans set out last year under which a record budget deficit running close to 10 percent of national output will fall sharply by the next election in 2015.
However, the independent Office for Budget Responsbility is likely to downgrade its 2.1 percent 2011 growth forecast, which could affect borrowing slightly in coming years and will encourage critics of the government's planned spending cuts.
Chief Secretary to the Treasury Danny Alexander, in an article for The Observer newspaper, said the Conservative-Liberal Democrat coalition would 'set out further real terms progress towards our goal of taking anyone earning less than 10,000 pounds out of tax altogether'.
The coalition has already raised the personal allowance threshold for income tax, up to which no tax is paid, to 7,475 pounds ($12,070) from 6,475 pounds. The budget on Wednesday is expected to lift it to around 8,000 pounds.
Writing in the News Of The World newspaper, finance minister George Osborne said it would be a 'disaster' if he abandoned his austerity plan, but said the budget would still help to create the conditions for recovery and support those in need.
'I'll be using some of the money our new government has raised from taxing the banks to create the most apprenticeships this country has ever seen, and a big expansion of work experience places,' Osborne said.
The youth package is expected to total 300 million pounds, divided between 50,000 new apprenticeships and 100,000 work experience places. The bank tax will yield 2.5 billion pounds per year.
Osborne indicated there could also be help for motorists struggling with rising petrol prices.
'I can't promise things the country can't afford, but I've listened to families and I will do what I can to help,' he said.
The government will also unveil the results of its cross-departmental growth review alongside the budget, with an overhaul of planning rules, red tape and regulation and tax simplification expected to form the bulk of measures.
Critics have expressed concern that such changes will do little to boost growth given the harsh fiscal tightening in train and the prospect of tighter monetary policy this year.
(Editing by Louise Ireland) ($1=.6192 Pound) Keywords: BRITAIN BUDGET/ (uk.economics@reuters.com; +44 207 542 7947) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
LONDON, March 19 (Reuters) - Britain's budget next week will exempt more workers from income tax and use bank levy money to help young people train for jobs, ministers said on Saturday.
The budget, billed as pro-growth and pro-reform, will stick broadly to deficit reduction plans set out last year under which a record budget deficit running close to 10 percent of national output will fall sharply by the next election in 2015.
However, the independent Office for Budget Responsbility is likely to downgrade its 2.1 percent 2011 growth forecast, which could affect borrowing slightly in coming years and will encourage critics of the government's planned spending cuts.
Chief Secretary to the Treasury Danny Alexander, in an article for The Observer newspaper, said the Conservative-Liberal Democrat coalition would 'set out further real terms progress towards our goal of taking anyone earning less than 10,000 pounds out of tax altogether'.
The coalition has already raised the personal allowance threshold for income tax, up to which no tax is paid, to 7,475 pounds ($12,070) from 6,475 pounds. The budget on Wednesday is expected to lift it to around 8,000 pounds.
Writing in the News Of The World newspaper, finance minister George Osborne said it would be a 'disaster' if he abandoned his austerity plan, but said the budget would still help to create the conditions for recovery and support those in need.
'I'll be using some of the money our new government has raised from taxing the banks to create the most apprenticeships this country has ever seen, and a big expansion of work experience places,' Osborne said.
The youth package is expected to total 300 million pounds, divided between 50,000 new apprenticeships and 100,000 work experience places. The bank tax will yield 2.5 billion pounds per year.
Osborne indicated there could also be help for motorists struggling with rising petrol prices.
'I can't promise things the country can't afford, but I've listened to families and I will do what I can to help,' he said.
The government will also unveil the results of its cross-departmental growth review alongside the budget, with an overhaul of planning rules, red tape and regulation and tax simplification expected to form the bulk of measures.
Critics have expressed concern that such changes will do little to boost growth given the harsh fiscal tightening in train and the prospect of tighter monetary policy this year.
(Editing by Louise Ireland) ($1=.6192 Pound) Keywords: BRITAIN BUDGET/ (uk.economics@reuters.com; +44 207 542 7947) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.