photos in the early hours of the morning. that was near downing street. also energised and with me throughout the day is our political correspondent. and in our bbc new newsroom i am joined by economics correspondent andy verity. we will be looking at what this budget will mean for you and will be looking at the challenges of the government and what will happen in the years ahead and whoever takes power after general election. he shouted there as a general election and we know there will be one before next january is so there is politics that comes with this. this is the last budget before that general election. the chancellor has promised that his plans will simulate —— stimulate the flagging economy. labour will argue that any reductions will still leave people worse off because of the freezing of tax thresholds. so what could be expected in today's budget — ben king takes a look. the background to the budget has been gloomy but it looks like the chancellor will find room to cut taxes. the conservatives are trailing labour in the polls and looking forjeremy hunt to give them some cheer in places like this, winchester, i see the lib dems hope to win. what do people here think about tax cuts? i to win. what do people here think about tax cuts?— about tax cuts? i think will be a aood about tax cuts? i think will be a good idea _ about tax cuts? i think will be a good idea because _ about tax cuts? i think will be a good idea because it _ about tax cuts? i think will be a good idea because it gives - about tax cuts? i think will be a l good idea because it gives people more money to spend what they want to buy. more money to spend what they want tobu. . , , ., more money to spend what they want tobu. , , my , m, m, to buy. realistically, people are to sa that to buy. realistically, people are to say that much _ to buy. realistically, people are to say that much money _ to buy. realistically, people are to say that much money from - to buy. realistically, people are to say that much money from a - to buy. realistically, people are to say that much money from a tax i to buy. realistically, people are to i say that much money from a tax were my money— say that much money from a tax were my money on— say that much money from a tax were my money on public service means better_ my money on public service means better health care and services and is much _ better health care and services and is much more important. i better health care and services and is much more important.— is much more important. i would refer is much more important. i would prefer not _ is much more important. i would prefer not to _ is much more important. i would prefer not to have _ is much more important. i would prefer not to have a _ is much more important. i would prefer not to have a tax - is much more important. i would prefer not to have a tax could . prefer not to have a tax could pursue — prefer not to have a tax could pursue more _ prefer not to have a tax could pursue more money- prefer not to have a tax could pursue more money investedj prefer not to have a tax could . pursue more money invested in prefer not to have a tax could - pursue more money invested in the communitv — pursue more money invested in the communitv if— pursue more money invested in the community-— community. if the public services were preperly — community. if the public services were properly organised, - community. if the public services were properly organised, there l community. if the public services| were properly organised, there is more than enough money to do it. this parliament has seen a record—breaking increase in taxation. that's partly because wages have been going up, but the thresholds were used to paying different rates have not. the chancellor has said he wants to cut taxes but the government also has a pledge to make sure the national debt is on callers like my course to fall. and as the budget responsibility office to decide whether that is being met and that works out as a big constraint to what the chancellor can do today. the traditional audience before budget day, some years the chancellor can say that an improved economy is given them more flexibility, but probably not by much this time. the chancellor will almost certainly freeze the fuel duty and is expected to cut national insurance by 2p in the pound, worth around £450 per year to somebody on around £450 per year to somebody on a full—time wage of 35,000, although pensioners and not affected as they do not pay it. he will probably have to pay for or raise revenue to balance it out, perhaps scrapping tax breaks for non—dom is, what the people who live overseas. he could raise duty a business class airfares and extend a windfall tax on oil and gas producers and even put a tax on vibes. , , , vibes. this is the first time there has ever been _ vibes. this is the first time there has ever been a _ vibes. this is the first time there has ever been a cabinet - vibes. this is the first time there has ever been a cabinet in - has ever been a cabinet in east yorkshire. has ever been a cabinet in east yorkshire-— yorkshire. the government self-imposed _ yorkshire. the government self-imposed rule - yorkshire. the government self-imposed rule is - yorkshire. the government i self-imposed rule is designed yorkshire. the government - self-imposed rule is designed to self—imposed rule is designed to show it will not let the national debt rise out of control but it's based on plans for future debt rise out of control but it's based on plans forfuture public spending that some feel are on wrearhs and it depends on highly uncertain projections of what might happen in five years' time. in recent years we have seen chancellors increase spending and cutting tax in the short—term tempered and promising to raise taxes and cut spending the longer term but that never happens and as a result we have just seen debt ratchet up in practice rather than starting to come down. the chancellor _ starting to come down. the chancellor says _ starting to come down. the chancellor says this - starting to come down. the chancellor says this will be a budget for long—term economic growth, sketching out a path to more jobs, better public services and lower taxes. 0r jobs, better public services and lower taxes. or will he also be able to provide a short—term boost some in his party are hoping for? ben king, bbc news, winchester. joining me now is our political correspondent, leila nathoo. we saw in the report there about some of what we know that might be outlined today.— outlined today. what more are you hearin: ? outlined today. what more are you hearing? it's _ outlined today. what more are you hearing? it's interesting _ outlined today. what more are you hearing? it's interesting to - outlined today. what more are you hearing? it's interesting to have i hearing? it's interesting to have a budget where we think the main headline is known in advance, this idea of cutting 2p a national insurance, the chancellor did this already last autumn and try a second bite at the cherry. tax cutting is and has been the message of this but should and everything back a few months ago, they were ramping up expectations and to the big tax cuts and of the economy should have turned a corner by now but here we are in march and the economy is nowhere near where the chancellor wanted it to be and we are officially in recession and interest rates are still high and we know the chancellor doesn't have much room to play with so he still wants to do tax cuts. why? because we know taxes are a record high levels and conservative backbenchers are clamouring for that and he thinks that by cutting purple taxes is going to be a growth stimulator and of course, we are months away from the general election so giving people a tax cut, a bit more money in their pockets. that said, how he does those tax cuts is going to be really interesting to see how he pays for it because we have seen what's happened in previous incarnations of budgets when there are unfunded tax cuts in the chancellor is going to be very careful to try and pay or say how he's going to pay and raise the revenue to pay for these tax cuts. yes, we know there is going to be a big headline figure of a cut to national insurance, the tax paid by workers and he's going to cut the employee side of that. but there will be other tax cuts in the way and we had an extended freeze of fuel duty. but this will all come with trade—offs... what price? and there will also be left little left to spin on public services. if the chancellor is trying to give people tax cuts he hopes that will stimulate growth and ultimately that will be paid by raising revenue elsewhere so we talked about his plans for introducing a tax on vaping and air passengers using an increasing tax on second homes in these things and is trying to raise money and also set traps for labour by nicking a few of their revenue raising ideas. an interesting political and economic backdrop to this budget i think tax cuts will be the message the chancellor wants to put forward. you the message the chancellor wants to ut forward. ., ., the message the chancellor wants to put forward-— put forward. you mentioned the tax cuts. one put forward. you mentioned the tax cuts- one thing _ put forward. you mentioned the tax cuts. one thing we _ put forward. you mentioned the tax cuts. one thing we were _ put forward. you mentioned the tax cuts. one thing we were talking - cuts. one thing we were talking about yesterday in brown's report was raising concerns about that and that's public spending. there are people who want to make sure there are schools and other public services and even prisons continue to get the money that they need. how much will not have to give? we heard about schemes being cut from local councils and diversity and equality schemes both kind of things. what councils and diversity and equality schemes both kind of things. what we about that? i — schemes both kind of things. what we about that? l think— schemes both kind of things. what we about that? l think that's _ schemes both kind of things. what we about that? i think that's a _ about that? i think that's a starting point when you think about a budget that you have to remember if you're taking, giving with one hand you are taking from another so there are always trade—offs and choices and the chancellor is prioritising tax cuts that has been the message. but as you said, there is not going to be any money for public services in this budget. schools got a bit of money back in the autumn but we don't expect to hear much about any other public services being given an extra pot of money and remember that all of these tax cuts that the chancellor announced today, they will necessitate tighter spending plans going forward so there has been a lot of discussion about the projections for public spending going forward beyond the next election and they are incredibly tight so whoever wins the next election they will have to see where they tighten them further in order to release the money now to fund those tax cuts. yes, definitely difficult decisions when it comes to public services and an interesting prodigal dimension to that is the question of whether that is what voters want because clearly that's on the mind of the prime minister and the chancellor as they came up with this together going and what will be an election year. do people want to have more money in their pockets in terms of tax cuts or do they want to see more money in the public services? it looks like the chancellor promised are gambling that people want to have tax cuts and is going to appeal to both broadly the electorate and tory voters. but yes, public services is going to be a huge question for whoever wins the next election and labour is talking about if they win it will be the worst inheritance since the second world war. leila, thank ou since the second world war. leila, thank you very _ since the second world war. leila, thank you very much. _ joining me now is our economics correspondent, andy verity andyjoins us from our newsroom. leila was touching on there that there isn't much wiggle room for the chancellor. the economy isn't growing. he doesn't really have that many tools to play with. what's your assessment of this cut that has been trialled and has been confirmed to national insurance?— national insurance? when we talk about wiggle _ national insurance? when we talk about wiggle room _ national insurance? when we talk about wiggle room we _ national insurance? when we talk about wiggle room we should - national insurance? when we talk about wiggle room we should be. about wiggle room we should be clean _ about wiggle room we should be clean we — about wiggle room we should be clear. we are talking about wiggle room _ clear. we are talking about wiggle room against the chancellor is fiscal— room against the chancellor is fiscal targets. room against the chancellor is fiscaltargets. he room against the chancellor is fiscal targets. he chooses those fiscal— fiscal targets. he chooses those fiscal targets. he chooses those fiscal targets under a political choice. — fiscal targets under a political choice, not an economic necessity. for example — choice, not an economic necessity. for example to have debt falling as a percentage of gdp five years from now _ a percentage of gdp five years from now there — a percentage of gdp five years from now. there is an element of arbitrariness in those targets and we talk— arbitrariness in those targets and we talk about headroom, if the chancellor who is deciding where the seniors, _ chancellor who is deciding where the seniors, could be higher or lower according — seniors, could be higher or lower according to his choice but not everything is absolutely necessary in order— everything is absolutely necessary in order for the government to say we have _ in order for the government to say we have the — in order for the government to say we have the public finances in sound shape _ we have the public finances in sound shape. these targets are very and chancellors — shape. these targets are very and chancellors very rarely hit them. take _ chancellors very rarely hit them. take the — chancellors very rarely hit them. take the business of head room with a pinch _ take the business of head room with a pinch of— take the business of head room with a pinch of salt. you asked for the economy— a pinch of salt. you asked for the economy and thus the interesting bit because _ economy and thus the interesting bit because although we are supposed or supposedly getting back to growth after flat activity in the second half of — after flat activity in the second half of last year, we are predicted to have _ half of last year, we are predicted to have by— half of last year, we are predicted to have by the bank of england may be about _ to have by the bank of england may be about half a percent of growth in the first— be about half a percent of growth in the first half of the year and perhaps— the first half of the year and perhaps three quarters in the second half and _ perhaps three quarters in the second half and that's way below the growth that we _ half and that's way below the growth that we have had in the past, way below— that we have had in the past, way below historic norms of two or 3% growth _ below historic norms of two or 3% growth per— below historic norms of two or 3% growth per year. what is growth anyway? — growth per year. what is growth anyway? it's worth asking this question? _ anyway? it's worth asking this question? what is the economy? the economy— question? what is the economy? the economy is— question? what is the economy? the economy is simply the people and economic— economy is simply the people and economic activity. if you are people. _ economic activity. if you are people, you grow the economy, but that doesn't mean each of us is getting — that doesn't mean each of us is getting worse off, we may be just the same — getting worse off, we may be just the same and may be no better off than last— the same and may be no better off than last year, isjust the same and may be no better off than last year, is just the economy has grown — than last year, is just the economy has grown because there are more people _ has grown because there are more people and that's what's happening at the _ people and that's what's happening at the moment. growth is predicted partly— at the moment. growth is predicted partly because we are having higher population because of immigration, partly— population because of immigration, partly because of people living tonger~ — partly because of people living longer. that matters. if you want a measure _ longer. that matters. if you want a measure of — longer. that matters. if you want a measure of how the economy is doing well for— measure of how the economy is doing well for you. — measure of how the economy is doing well for you, you want to look at gross _ well for you, you want to look at gross domestic product, the measure of all the _ gross domestic product, the measure of all the goods and services we provide, — of all the goods and services we provide, per capita, per individual. it's the _ provide, per capita, per individual. it's the whole economy divided by the number of people. that looks really _ the number of people. that looks really bad — the number of people. that looks really bad at the moment and that is the best— really bad at the moment and that is the best indicator you will get what would _ the best indicator you will get what would happen to living standards and i'm afraid _ would happen to living standards and i'm afraid all the predictions are saying _ i'm afraid all the predictions are saying it's — i'm afraid all the predictions are saying it's going to go down. with tax cuts, — saying it's going to go down. with tax cuts, the interesting questions are that _ tax cuts, the interesting questions are that the chancellor is giving with one — are that the chancellor is giving with one hand in an way but at the same _ with one hand in an way but at the same time — with one hand in an way but at the same time he is taking away from us workers and — same time he is taking away from us workers and families in a much less obvious— workers and families in a much less obvious way— workers and families in a much less obvious way and is by was describing his report _ obvious way and is by was describing his report the tax threshold above which _ his report the tax threshold above which you — his report the tax threshold above which you start paying tax have been frozen _ which you start paying tax have been frozen. they use to rise with inflation _ frozen. they use to rise with inflation because they didn't rise with inflation. as wages have risen, a larger— with inflation. as wages have risen, a larger chunk of your income is subject— a larger chunk of your income is subject to — a larger chunk of your income is subject to tax and that's worth by some _ subject to tax and that's worth by some calculations the same as adding four or— some calculations the same as adding four or five _ some calculations the same as adding four or five or even 6p in the pound to the _ four or five or even 6p in the pound to the income tax rate. 0ne to the income tax rate. one is giving — to the income tax rate. one is giving back to our 3p in the pound this time — giving back to our 3p in the pound this time or— giving back to our 3p in the pound this time or 2p and the time t'pau last time, — this time or 2p and the time t'pau last time, a — this time or 2p and the time t'pau last time, a lot of people combined with the _ last time, a lot of people combined with the tax threshold been frozen or still— with the tax threshold been frozen or still worse.— or still worse. andy verity, you will be with _ or still worse. andy verity, you will be with us _ or still worse. andy verity, you will be with us all— or still worse. andy verity, you will be with us all day - or still worse. andy verity, you will be with us all day taking i or still worse. andy verity, you j will be with us all day taking us through the developments as the budget and falls. for the moment, thank you very much. joining me now is conservative mp harriett baldwin, chair of the treasury select committe, the cross party group of mps who examine the work of the treasury and other financial bodies welcome to bbc news. your committee because myjob is to scrutinise the budget once we know what it is. what things you will be looking at for today. i things you will be looking at for toda . ., . things you will be looking at for toda . ~ ., ., ., ., , things you will be looking at for toda . ~ ., ., ., m , today. i think a lot of it has been trialled already _ today. i think a lot of it has been trialled already but _ today. i think a lot of it has been trialled already but there - today. i think a lot of it has been trialled already but there is - today. i think a lot of it has been| trialled already but there is some speculation _ trialled already but there is some speculation i_ trialled already but there is some speculation. i think— trialled already but there is some speculation. i think as _ trialled already but there is some speculation. i think as you - trialled already but there is some | speculation. i think as you hurting your package, _ speculation. i think as you hurting your package, what _ speculation. i think as you hurting your package, what you _ speculation. i think as you hurting your package, what you will- speculation. i think as you hurting your package, what you will wantl speculation. i think as you hurting i your package, what you will want to be seeing _ your package, what you will want to be seeing are— your package, what you will want to be seeing are things _ your package, what you will want to be seeing are things continue - your package, what you will want to be seeing are things continue with. be seeing are things continue with the progress — be seeing are things continue with the progress that _ be seeing are things continue with the progress that we _ be seeing are things continue with the progress that we have - be seeing are things continue with the progress that we have seen i be seeing are things continue with. the progress that we have seen and getting _ the progress that we have seen and getting inflation— the progress that we have seen and getting inflation back— the progress that we have seen and getting inflation back down. - the progress that we have seen and getting inflation back down. if- the progress that we have seen and getting inflation back down. if you i getting inflation back down. if you remember— getting inflation back down. if you remember it— getting inflation back down. if you remember it was _ getting inflation back down. if you remember it was above _ getting inflation back down. if you remember it was above 11% - getting inflation back down. if you remember it was above 11% at - getting inflation back down. if youj remember it was above 11% at one time _ remember it was above 11% at one time and — remember it was above 11% at one time and now— remember it was above 11% at one time and now it's _ remember it was above 11% at one time and now it's back— remember it was above 11% at one time and now it's back at- remember it was above 11% at one time and now it's back at 4% - remember it was above 11% at one time and now it's back at 4% and i remember it was above 11% at one i time and now it's back at 4% and you will want _ time and now it's back at 4% and you will want to— time and now it's back at 4% and you will want to see _ time and now it's back at 4% and you will want to see things _ time and now it's back at 4% and you will want to see things in the - will want to see things in the budget— will want to see things in the budget today _ will want to see things in the budget today that _ will want to see things in the budget today that help - will want to see things in the budget today that help it - will want to see things in the budget today that help it to i will want to see things in the . budget today that help it to get to the predicted _ budget today that help it to get to the predicted rate _ budget today that help it to get to the predicted rate of— budget today that help it to get to the predicted rate of 2%, - budget today that help it to get to the predicted rate of 2%, its - budget today that help it to get toi the predicted rate of 2%, its target by the _ the predicted rate of 2%, its target by the middle _ the predicted rate of 2%, its target by the middle of _ the predicted rate of 2%, its target by the middle of this _ the predicted rate of 2%, its target by the middle of this year. - the predicted rate of 2%, its target by the middle of this year. i - the predicted rate of 2%, its target by the middle of this year. i think. by the middle of this year. i think that's— by the middle of this year. i think that's really— by the middle of this year. i think that's really important. _ by the middle of this year. i think that's really important. that- by the middle of this year. i think that's really important. that is. by the middle of this year. i think. that's really important. that is why ithink— that's really important. that is why i think we — that's really important. that is why i think we feel _ that's really important. that is why i think we feel confident _ that's really important. that is why i think we feel confident the - i think we feel confident the chancellor— i think we feel confident the chancellor will _ i think we feel confident the chancellor will announce - i think we feel confident the chancellor will announce £5| i think we feel confident the i chancellor will announce £5 off i think we feel confident the - chancellor will announce £5 off the price of— chancellor will announce £5 off the price of fuel— chancellor will announce £5 off the price of fuel to— chancellor will announce £5 off the price of fuel to continue _ chancellor will announce £5 off the price of fuel to continue for- price of fuel to continue for another— price of fuel to continue for another year— price of fuel to continue for anotheryear —— _ price of fuel to continue for anotheryear —— my- price of fuel to continue for another year —— my 5p... . price of fuel to continue for. another year —— my 5p... that price of fuel to continue for- another year —— my 5p... that will help— another year —— my 5p... that will help with — another year —— my 5p... that will help with the _ another year —— my 5p... that will help with the inflation _ another year —— my 5p... that will help with the inflation rate - another year —— my 5p... that will help with the inflation rate and . another year —— my 5p... that will help with the inflation rate and i. help with the inflation rate and i think— help with the inflation rate and i think he — help with the inflation rate and i think he will— help with the inflation rate and i think he will announce - help with the inflation rate and i think he will announce things i help with the inflation rate and i. think he will announce things that will continue _ think he will announce things that will continue with— think he will announce things that will continue with the _ think he will announce things that will continue with the progress i think he will announce things that| will continue with the progress we have seen— will continue with the progress we have seen in— will continue with the progress we have seen in real— will continue with the progress we have seen in real disposable - will continue with the progress we . have seen in real disposable income for households. _ have seen in real disposable income for households. for— have seen in real disposable income for households. for the _ have seen in real disposable income for households. for the first - have seen in real disposable income for households. for the first time, l for households. for the first time, at the _ for households. for the first time, at the end — for households. for the first time, at the end of— for households. for the first time, at the end of last _ for households. for the first time, at the end of last year, _ for households. for the first time, at the end of last year, you - for households. for the first time, at the end of last year, you saw. at the end of last year, you saw people's— at the end of last year, you saw people's wages _ at the end of last year, you saw people's wages have _ at the end of last year, you saw people's wages have started . at the end of last year, you saw people's wages have started to| at the end of last year, you saw- people's wages have started to rise faster— people's wages have started to rise faster than— people's wages have started to rise faster than the _ people's wages have started to rise faster than the rate _ people's wages have started to rise faster than the rate of _ people's wages have started to rise faster than the rate of inflation - faster than the rate of inflation and that— faster than the rate of inflation and that means _ faster than the rate of inflation and that means that _ faster than the rate of inflation and that means that people . faster than the rate of inflation| and that means that people are seeing — and that means that people are seeing real— and that means that people are seeing real increases _ and that means that people are seeing real increases in- and that means that people are seeing real increases in their. seeing real increases in their income _ seeing real increases in their income there _ seeing real increases in their income. there was _ seeing real increases in their income. there was also - seeing real increases in their income. there was also 2p . seeing real increases in their. income. there was also 2p cut seeing real increases in their- income. there was also 2p cut of national— income. there was also 2p cut of national insurance _ income. there was also 2p cut of national insurance that _ income. there was also 2p cut of national insurance that came - income. there was also 2p cut of| national insurance that came into force _ national insurance that came into force on— national insurance that came into force on the _ national insurance that came into force on the sixth _ national insurance that came into force on the sixthjanuary- national insurance that came into force on the sixth january and - national insurance that came intol force on the sixth january and that is worth— force on the sixth january and that is worth about _ force on the sixth january and that is worth about £450 _ force on the sixth january and that is worth about £450 for— force on the sixth january and that is worth about £450 for a mediumj is worth about £450 for a medium salary— is worth about £450 for a medium salary and — is worth about £450 for a medium salary and what _ is worth about £450 for a medium salary and what you _ is worth about £450 for a medium salary and what you are going - is worth about £450 for a medium salary and what you are going to i is worth about £450 for a medium . salary and what you are going to see today— salary and what you are going to see today is— salary and what you are going to see today is perhaps _ salary and what you are going to see today is perhaps more progress - salary and what you are going to see today is perhaps more progress on l today is perhaps more progress on that and _ today is perhaps more progress on that and it's — today is perhaps more progress on that and it's done _ today is perhaps more progress on that and it's done in _ today is perhaps more progress on that and it's done in a _ today is perhaps more progress on that and it's done in a way - today is perhaps more progress on that and it's done in a way that - today is perhaps more progress on that and it's done in a way that the office _ that and it's done in a way that the office for— that and it's done in a way that the office for budget _ that and it's done in a way that the office for budget responsibility i office for budget responsibility regards — office for budget responsibility regards as— office for budget responsibility regards as being _ office for budget responsibility. regards as being noninflationary. thats— regards as being noninflationary. that's going _ regards as being noninflationary. that's going to _ regards as being noninflationary. that's going to be _ regards as being noninflationary. that's going to be a _ regards as being noninflationary. that's going to be a really- that's going to be a really important _ that's going to be a really important focus _ that's going to be a really important focus for- that's going to be a really important focus for us - that's going to be a really. important focus for us when that's going to be a really- important focus for us when we see the office _ important focus for us when we see the office for— important focus for us when we see the office for budget _ important focus for us when we see the office for budget responsibility next week— the office for budget responsibility next week in— the office for budget responsibility next week in front _ the office for budget responsibility next week in front of _ the office for budget responsibility next week in front of our _ the office for budget responsibilityl next week in front of our committee and that— next week in front of our committee and that the — next week in front of our committee and that the chancellor— next week in front of our committee and that the chancellor next - and that the chancellor next wednesday _ and that the chancellor next wednesday in _ and that the chancellor next wednesday in front - and that the chancellor next wednesday in front of- and that the chancellor next wednesday in front of our. and that the chancellor next - wednesday in front of our committee. and there _ wednesday in front of our committee. and there are — wednesday in front of our committee. and there are so— wednesday in front of our committee. and there are so many— wednesday in front of our committee. and there are so many families - and there are so many families across the country who are still feeling this cost of living crisis, even though, as you say, inflation has stabilised but it is still double by the government was a target rate of 2% is and people still feel higher prices when they go and get their weekly shop. you finall see go and get their weekly shop. you finally see now _ go and get their weekly shop. you finally see now the rate of inflation _ finally see now the rate of inflation fall— finally see now the rate of inflation fall for— finally see now the rate of inflation fall for groceriesl finally see now the rate of. inflation fall for groceries and finally see now the rate of- inflation fall for groceries and it aets inflation fall for groceries and it gets back— inflation fall for groceries and it gets back to— inflation fall for groceries and it gets back to less _ inflation fall for groceries and it gets back to less than - inflation fall for groceries and it gets back to less than the - gets back to less than the government— gets back to less than the government target, - gets back to less than the government target, so . gets back to less than the i government target, so that gets back to less than the - government target, so that is good new5, _ government target, so that is good news, we _ government target, so that is good news, we heard _ government target, so that is good news, we heard from _ government target, so that is good news, we heard from the governor| government target, so that is good . news, we heard from the governor of the bank— news, we heard from the governor of the bank of— news, we heard from the governor of the bank of england _ news, we heard from the governor of the bank of england recently- news, we heard from the governor of the bank of england recently that - the bank of england recently that they are — the bank of england recently that they are expecting _ the bank of england recently that they are expecting to _ the bank of england recently that they are expecting to see - the bank of england recently thati they are expecting to see inflation back to _ they are expecting to see inflation back to target _ they are expecting to see inflation back to target by _ they are expecting to see inflation back to target by the _ they are expecting to see inflation back to target by the middle - they are expecting to see inflation back to target by the middle of. they are expecting to see inflation| back to target by the middle of this year~ _ back to target by the middle of this year~ but— back to target by the middle of this year. but you — back to target by the middle of this year. but you are _ back to target by the middle of this year. but you are right, _ back to target by the middle of this year. but you are right, the - year. but you are right, the chancellor— year. but you are right, the chancellor has _ year. but you are right, the chancellor has to _ year. but you are right, the chancellor has to have - year. but you are right, the chancellor has to have that| year. but you are right, the . chancellor has to have that at year. but you are right, the - chancellor has to have that at the front _ chancellor has to have that at the front of— chancellor has to have that at the front of his — chancellor has to have that at the front of his mind _ chancellor has to have that at the front of his mind today _ chancellor has to have that at the front of his mind today to - chancellor has to have that at the front of his mind today to make l front of his mind today to make sure that none _ front of his mind today to make sure that none of— front of his mind today to make sure that none of the _ front of his mind today to make sure that none of the measures _ front of his mind today to make sure that none of the measures that - that none of the measures that are implemented — that none of the measures that are implemented today— that none of the measures that are implemented today make - that none of the measures that are implemented today make inflation| implemented today make inflation worse _ implemented today make inflation worse because _ implemented today make inflation worse because we _ implemented today make inflation worse because we have _ implemented today make inflation worse because we have seen - implemented today make inflation worse because we have seen this. implemented today make inflation i worse because we have seen this real progress. _ worse because we have seen this real progress. this— worse because we have seen this real progress. this real— worse because we have seen this real progress, this real turning _ worse because we have seen this real progress, this real turning point- progress, this real turning point where _ progress, this real turning point where wages _ progress, this real turning point where wages are _ progress, this real turning point where wages are now _ progress, this real turning point where wages are now rising - progress, this real turning point. where wages are now rising faster than inflation _ where wages are now rising faster than inflation and _ where wages are now rising faster than inflation and of _ where wages are now rising faster than inflation and of course, - where wages are now rising fasterl than inflation and of course, wages for the _ than inflation and of course, wages for the lowest _ than inflation and of course, wages for the lowest paid _ than inflation and of course, wages for the lowest paid in— than inflation and of course, wages for the lowest paid in the _ than inflation and of course, wages for the lowest paid in the economy| for the lowest paid in the economy going _ for the lowest paid in the economy going up— for the lowest paid in the economy going up particularly— for the lowest paid in the economy going up particularly fast _ for the lowest paid in the economy going up particularly fast with - for the lowest paid in the economy going up particularly fast with the i going up particularly fast with the anticipated — going up particularly fast with the anticipated increase _ going up particularly fast with the anticipated increase in— going up particularly fast with the anticipated increase in national. anticipated increase in national living _ anticipated increase in national living wage _ anticipated increase in national living wage it— anticipated increase in national living wage. it means - anticipated increase in national living wage. it means that - anticipated increase in national. living wage. it means that people anticipated increase in national- living wage. it means that people on those _ living wage. it means that people on those lower— living wage. it means that people on those lower incomes _ living wage. it means that people on those lower incomes and _ living wage. it means that people on those lower incomes and lower- living wage. it means that people onl those lower incomes and lower wages are a much, _ those lower incomes and lower wages are a much, much— those lower incomes and lower wages are a much, much smaller— those lower incomes and lower wages are a much, much smaller part - those lower incomes and lower wages are a much, much smaller part of- those lower incomes and lower wages are a much, much smaller part of the | are a much, much smaller part of the overall— are a much, much smaller part of the overall economy _ are a much, much smaller part of the overall economy and _ are a much, much smaller part of the overall economy and we _ are a much, much smaller part of the overall economy and we have seen i overall economy and we have seen real progress — overall economy and we have seen real progress in _ overall economy and we have seen real progress in terms _ overall economy and we have seen real progress in terms of— overall economy and we have seen real progress in terms of that - overall economy and we have seen real progress in terms of that so . real progress in terms of that so that's— real progress in terms of that so that's an — real progress in terms of that so that's an important _ real progress in terms of that so that's an important lens - real progress in terms of that so that's an important lens to - real progress in terms of that so that's an important lens to lookl real progress in terms of that so i that's an important lens to look at the announcements— that's an important lens to look at the announcements today - that's an important lens to look atl the announcements today through. that's an important lens to look at - the announcements today through. let me ask the announcements today through. me ask you about this because it's something we have been discussing with leila and my colleague's report there as well. there is some concern over public funding for hospitals, schools, because something has to give and there are concerns that we could be moving into another area of austerity when it comes to public spending. i’d austerity when it comes to public sendina. �* ., austerity when it comes to public sendina. �* . ., spending. i'd say far from it, actually- _ spending. i'd say far from it, actually. that's _ spending. i'd say far from it, actually. that's an _ spending. i'd say far from it, actually. that's an important spending. i'd say far from it, - actually. that's an important point so today— actually. that's an important point so today is — actually. that's an important point so today is a — actually. that's an important point so today is a budget, _ actually. that's an important point so today is a budget, it's - actually. that's an important point so today is a budget, it's not - so today is a budget, it's not spending _ so today is a budget, it's not spending review. _ so today is a budget, it's not spending review. we - so today is a budget, it's not spending review. we are - so today is a budget, it's not spending review. we are in. so today is a budget, it's not . spending review. we are in the middle — spending review. we are in the middle of— spending review. we are in the middle of the _ spending review. we are in the middle of the spending - spending review. we are in the middle of the spending reviewl spending review. we are in the - middle of the spending review that was set _ middle of the spending review that was set a _ middle of the spending review that was set a couple _ middle of the spending review that was set a couple of _ middle of the spending review that was set a couple of years - middle of the spending review that was set a couple of years ago - middle of the spending review that was set a couple of years ago that| was set a couple of years ago that runs until— was set a couple of years ago that runs until 2025— was set a couple of years ago that runs until 2025 and _ was set a couple of years ago that runs until 2025 and that _ was set a couple of years ago that runs until 2025 and that was - was set a couple of years ago that runs until 2025 and that was at. runs until 2025 and that was at record — runs until 2025 and that was at record levels— runs until 2025 and that was at record levels of— runs until 2025 and that was at record levels of public- runs until 2025 and that was at| record levels of public spending runs until 2025 and that was at - record levels of public spending on those _ record levels of public spending on those important _ record levels of public spending on those important things _ record levels of public spending on those important things like - record levels of public spending on| those important things like schools and hospitals _ those important things like schools and hospitals. absolutely- those important things like schools and hospitals. absolutely the - those important things like schools and hospitals. absolutely the case. what _ and hospitals. absolutely the case. what we _ and hospitals. absolutely the case. what we have — and hospitals. absolutely the case. what we have seen _ and hospitals. absolutely the case. what we have seen in— and hospitals. absolutely the case. what we have seen in terms - and hospitals. absolutely the case. what we have seen in terms of- and hospitals. absolutely the case. what we have seen in terms of the| what we have seen in terms of the office _ what we have seen in terms of the office for— what we have seen in terms of the office for budget _ what we have seen in terms of the office for budget responsibility's i office for budget responsibility's projections — office for budget responsibility's projections and _ office for budget responsibility's projections and the _ office for budget responsibility's projections and the chancellor. projections and the chancellor public— projections and the chancellor public projections _ projections and the chancellor public projections for- projections and the chancellor public projections for public i public projections for public spending _ public projections for public spending is _ public projections for public spending is that _ public projections for public spending is that increase i public projections for public i spending is that increase and public projections for public - spending is that increase and level public— spending is that increase and level public spending _ spending is that increase and level public spending is _ spending is that increase and level public spending is to _ spending is that increase and level public spending is to continue - spending is that increase and level public spending is to continue by. public spending is to continue by inflation — public spending is to continue by inflation plus— public spending is to continue by inflation plus 1%_ public spending is to continue by inflation plus 1% in— inflation plus 1% in the projected beauty— inflation plus 1% in the projected beauty during _ inflation plus 1% in the projected beauty during the _ inflation plus 1% in the projected beauty during the period - inflation plus 1% in the projected beauty during the period ad - inflation plus 1% in the projected beauty during the period ad for. inflation plus 1% in the projected i beauty during the period ad for five years— beauty during the period ad for five years and _ beauty during the period ad for five years and that _ beauty during the period ad for five years and that is _ beauty during the period ad for five years and that is really _ beauty during the period ad for five years and that is really important l years and that is really important and we _ years and that is really important and we do — years and that is really important and we do need _ years and that is really important and we do need to— years and that is really important and we do need to keep - years and that is really important. and we do need to keep increasing our public— and we do need to keep increasing our public spending, _ and we do need to keep increasing our public spending, but _ and we do need to keep increasing our public spending, but in - and we do need to keep increasingl our public spending, but in addition to that, _ our public spending, but in addition to that, i_ our public spending, but in addition to that, ithink— our public spending, but in addition to that, i think what— our public spending, but in addition to that, i think what the _ our public spending, but in addition to that, i think what the public- to that, i think what the public would — to that, i think what the public would like _ to that, i think what the public would like to _ to that, i think what the public would like to see _ to that, i think what the public would like to see is _ to that, i think what the public would like to see is making. to that, i think what the public. would like to see is making sure that their— would like to see is making sure that their money _ would like to see is making sure that their money has _ would like to see is making sure that their money has been - would like to see is making sure| that their money has been spent wisely— that their money has been spent wisely so— that their money has been spent wisely so there _ that their money has been spent wisely so there will _ that their money has been spent wisely so there will be _ that their money has been spent wisely so there will be more - wisely so there will be more announcements— wisely so there will be more announcements in— wisely so there will be more announcements in terms - wisely so there will be more announcements in terms ofi wisely so there will be more i announcements in terms of the productivity _ announcements in terms of the productivity of _ announcements in terms of the productivity of that _ announcements in terms of the productivity of that spending. l announcements in terms of the l productivity of that spending. for example. — productivity of that spending. for example. the _ productivity of that spending. for example, the output— productivity of that spending. for example, the output from - productivity of that spending. for example, the output from our. example, the output from our hospitals _ example, the output from our hospitals and _ example, the output from our hospitals and the _ example, the output from our hospitals and the nhs - example, the output from our hospitals and the nhs is - example, the output from our hospitals and the nhs is not i example, the output from our- hospitals and the nhs is not quite back hospitals and the nhs is not quite hack to _ hospitals and the nhs is not quite hack to where _ hospitals and the nhs is not quite back to where it _ hospitals and the nhs is not quite back to where it was _ hospitals and the nhs is not quite back to where it was before - hospitals and the nhs is not quite back to where it was before the i back to where it was before the pandemic— back to where it was before the pandenric so— back to where it was before the pandenric so i— back to where it was before the pandemic so i think— back to where it was before the pandemic so i think there - back to where it was before the pandemic so i think there is - back to where it was before the . pandemic so i think there is room for improvement— pandemic so i think there is room for improvement on— pandemic so i think there is room for improvement on that - pandemic so i think there is room for improvement on that front - pandemic so i think there is room| for improvement on that front and pandemic so i think there is room l for improvement on that front and i think— for improvement on that front and i think he _ for improvement on that front and i think he will— for improvement on that front and i think he will talk— for improvement on that front and i think he will talk about _ for improvement on that front and i think he will talk about that - for improvement on that front and i think he will talk about that today l think he will talk about that today but it's— think he will talk about that today but it's really— think he will talk about that today but it's really important— think he will talk about that today but it's really important to - think he will talk about that today but it's really important to the - but it's really important to the public— but it's really important to the public that— but it's really important to the public that public— but it's really important to the public that public spending - but it's really important to the public that public spending is. public that public spending is continuing _ public that public spending is continuing to— public that public spending is continuing to increase - public that public spending is continuing to increase and i public that public spending is continuing to increase and is| continuing to increase and is continuing _ continuing to increase and is continuing to _ continuing to increase and is continuing to increase - continuing to increase and is continuing to increase afteri continuing to increase after inflation _ continuing to increase after inflation as— continuing to increase after inflation as well. _ continuing to increase after inflation as well.— continuing to increase after inflation as well. harriet, thank ou ve inflation as well. harriet, thank you very much _ inflation as well. harriet, thank you very much for _ inflation as well. harriet, thank you very much forjoining - inflation as well. harriet, thank you very much forjoining us. i you very much forjoining us. joining me now is a member of a charges would the rights of mother. welcome to bbc news. what are you looking for today? fit" welcome to bbc news. what are you looking for today?— looking for today? our top priority for today is _ looking for today? our top priority for today is an _ looking for today? our top priority for today is an increase _ looking for today? our top priority for today is an increase in - looking for today? our top priority for today is an increase in funding | for today is an increase in funding to child providers. the current funding provided by the government does not cover the cost to deliver the free places that have been guaranteed to parents. we know that for the 3—4 —year—old entitlement, the shortfall is about £1.85 billion and of course, that's adding enormous pressure on to providers under sustainability in terms of the recruitment and retention of staff and it means that ultimately we will see more providers close for knock—on economy and families. the second thing we want to see is an increase in funding with special educational needs and disabilities. we know that only 18% of local authorities say that they have enough provision for children with disabilities and again it has enormous pressure of the parents who have children with special educational needs. the recent there is such a low provision is there is a complex process to apply for that funding in the funding is very low and we know that 92% are providers so they fund the provision out of their own pockets or other of core budgets and finally, one of the key things we need to see is funding rights for the indexed to inflation and increases in national living wage. what has happened historically is wages have increased and the funding has not kept pace with those funding has not kept pace with those funding increases. nurseries are then expected to absorb those additional gusts. if we could guarantee that when there's cost increases, it will mean they are more sustainable, they can plan for the future and that will then benefit families and the economy. there's a lot of things on that list that you want but this is a difficult time in the economy is in a recession, albeit a mild one. not everything can be delivered. if you had to prioritise one of those things, what would it be? the easiest thing _ things, what would it be? the easiest thing the _ things, what would it be? tie: easiest thing the government things, what would it be? tte: easiest thing the government can things, what would it be? t"t9 easiest thing the government can do todayis easiest thing the government can do today is to index funding rights to national living wage increases and to inflation. that will guarantee sustainability for those providers that are delivering those funded places over the next few years. and places over the next few years. and let me ask — places over the next few years. and let me ask about _ places over the next few years. and let me ask about this because there has been debate about this and that over the thresholds with which you can get additional funding to help a child care. at the moment is 50,000, isn't it? it’s child care. at the moment is 50,000, isn't it? �* , ' :: :: :: :: :: child care. at the moment is 50,000, isn't it?_ laut— child care. at the moment is 50,000, isn't it?_ lout to - child care. at the moment is 50,000, isn't it?_ but to think- isn't it? it's 100,000. but to think 50,000 isn't it? it's100,000. but to think 50.000 single — isn't it? it's100,000. but to think 50,000 single earners. _ isn't it? it's100,000. but to think 50,000 single earners. yes, - isn't it? it's100,000. but to thinkl 50,000 single earners. yes, based isn't it? it's100,000. but to think- 50,000 single earners. yes, based on the sinale 50,000 single earners. yes, based on the single earner _ 50,000 single earners. yes, based on the single earner not _ 50,000 single earners. yes, based on the single earner not a _ 50,000 single earners. yes, based on the single earner not a double - the single earner not a double earner. if one person earns over £100,000 you can access childcare funding at all. what you think? i think that should increase it impact single parents when you base eligibility and single earner households. there are not many single earners or warning over hundreds as musk is difficult to earn a living and blaming herfor a child but there are some and i need help in the current climate, some people with sight hundred thousand pounds isn't an enormous amount of money, particularly if you're living in london where gusts are higher so i would like to see that increase but we would also like to see that increase for child benefit today because £50,000 and that has not increased for a number of years despite increases in inflation. thank you very much and may be will talk to you after we know what is announced in the budget but for the moment, thank you very much. we are expecting the chancellor is cut and his feet at 12:30pm and that's when he will set out his budget to members of parliament. at the moment. the cabinet is gathered there are gathering at downing street where mr hunt will outline his budget and get their sign—ups before he then gets that famous photo opportunity that we see every budget where he holds up the red box with the important budget inside it to the cameras before he makes his way over to the houses of parliament behind me and we can see, there is james cleverley, home secretary, leaving the cabinet meeting and others as well departing the black door. they have been briefed now and they know what is in that budget and we will find out in a few hours from now as well. of course, this is a budget which affects millions of people across the country, it affects people who are living through this cost of living crisis but there is also a political dimension to this as well because this is the last budget before the next uk general election. there are a lot of elements and angles that we will be looking up throughout the day. we will be digesting and dissecting what this means for families across the uk and for businesses and also looking at what this means ahead of a general election and to discuss all of that and a bit more detail in place to say i am joined by pauljohnson, the director of the iss, —— iss... it... welcome to bbc news, paul. you have heard what has been floated around about what we might be expecting in the budget later today. what do you make of what you have heard so far, particularly the 2p cut in national insurance?— particularly the 2p cut in national insurance? :, , ., :, ., insurance? that 2p count in national insurance? that 2p count in national insurance sounds _ insurance? that 2p count in national insurance sounds like _ insurance? that 2p count in national insurance sounds like it _ insurance? that 2p count in national insurance sounds like it will- insurance sounds like it will be, unless there's big surprises, the biggest thing in the budget. it's a substantial tax code, particularly coming on top of the 2p cut in national insurance was announced backin national insurance was announced back in november and introduced in january and between them, they make 20 billion or so tax cut. they will make most people who work several hundred pounds better off than they otherwise would have done. i have to say, relative to cutting income tax, which is the other thing that has been discussed, it strikes me that was the right choice, it helps people of working age in work, which is the group that needs most help at the moment. it's worth putting it in context. certainly for higher earners, the freezing of the tax threshold is a bigger tax rise than this will be a tax cut and also for the lowest earners they will still be worse off net but, overall, a pretty chunky tax cut. in be worse off net but, overall, a pretty chunky tax cut.— be worse off net but, overall, a pretty chunky tax cut. in terms of how this can _ pretty chunky tax cut. in terms of how this can get _ pretty chunky tax cut. in terms of how this can get the _ pretty chunky tax cut. in terms of. how this can get the uk's economy back on track, we are in a recession, and be it a mild one. the economy is not growing, there are people who still want to see interest rates come down but that's the bank of england plasma call on that one. inflation is still double the government's target rate. once your analysis of what these moves can do to move the dial in terms of getting his back on track in terms of growth? t getting his back on track in terms of urowth? ~' :, getting his back on track in terms of urowth? ~ :, , :, getting his back on track in terms of growth?— of growth? i think one should not overstate the _ of growth? i think one should not overstate the impact. _ of growth? i think one should not overstate the impact. this - of growth? i think one should not overstate the impact. this is - of growth? i think one should not overstate the impact. this is a i of growth? i think one should notl overstate the impact. this is a £10 billion tax cut in two and a half trillion pound economy. the saudi economy, these are not huge changes. —— size of the economy. in national income is essentially flat and has been for quite a while. when you look at national income per person, that has actually been falling for two years which is extraordinary and the reason for the difference is the population has risen quite fast over that period. broadly speaking, the economy is stagnant but overall in terms of the size of the economy per person, it has been going down now for quite a period of time. latte person, it has been going down now for quite a period of time.— for quite a period of time. we had harriett baldwin _ for quite a period of time. we had harriett baldwin on _ for quite a period of time. we had harriett baldwin on just _ for quite a period of time. we had harriett baldwin on just now- for quite a period of time. we had harriett baldwin on just now from| harriett baldwin on just now from the treasury select committee. she was reassuring people that spending on public services would not be impacted. what's your take on that in the short to long term? t impacted. what's your take on that in the short to long term?- in the short to long term? i think there's a difference _ in the short to long term? i think there's a difference between - in the short to long term? i think there's a difference between the| there's a difference between the short run in the long run here. i don't know whether we'll get announcements of what's going to happen in the year ahead, although i wouldn't be surprised if we get an increase in health spending, not least because there was a big top of this year and if they don't allocate any more to the nhs, that will be a year on year cut. i would hope there are some additional money there in the short run. in the longer run, the short run. in the longer run, the problem is the chancellor is predicated on all of this on the assumption or the expectation of cuts after 2025. he may not be chancellor after 2025 but he certainly leaving his successors, or potential successors in quite big problems. potential successors in quite big roblems. :, :, , problems. some of the other things that have been _ problems. some of the other things that have been touted, _ problems. some of the other things that have been touted, to _ problems. some of the other things that have been touted, to give - problems. some of the other things| that have been touted, to give some of the money back as it were from this tax cut, things like a tax on business class flights in terms of carbon tax potentially and also non—dom changes as well. what do you think does changes that have been touted could be effective in terms of getting money back? it’s touted could be effective in terms of getting money back?— of getting money back? it's worth sa in: of getting money back? it's worth saying that _ of getting money back? it's worth saying that in _ of getting money back? it's worth saying that in terms _ of getting money back? it's worth saying that in terms of _ of getting money back? it's worth saying that in terms of carbon - saying that in terms of carbon emission, the way we tax flying and business because flying is very light at the moment comparable other carbon taxes on a carbon tax there is a case for increasing the tax. as luck would raise much money but in terms of getting a sensible tax system to deal with climate change there is something to be said for that. in terms of non—dom is, what i hope is whatever is proposed is well thought through and not something that appears to be dreamt up at the last minute to fill a small hole and the reason for that is the incredibly complex area. there is scope for reform and scope for tightening it up butjust to give you an illustration of how it might be risky if you get it wrong, the 30 odd thousand people who currently register as non—dom is and get the special tax treatment of their foreign income, they already pay something like hundred and £70,000 per person in tax in the uk. what you don't want to see —— £170,000... let'sjust hope you don't want to see —— £170,000... let's just hope it's carefully throw through. t let's just hope it's carefully throw throu~h. :. let's just hope it's carefully throw throu~h. :, :, :, ., through. i wanted to mention that because that _ through. i wanted to mention that because that was _ through. i wanted to mention that because that was a _ through. i wanted to mention that because that was a policy - through. i wanted to mention that because that was a policy about i because that was a policy about non—domicile people who the labour party has also proposed in the past. we are going into a general election year of course. we don't know who's going to be the next government whoever is, how much space is there to change whatever is announced today economically? a new government has all sorts of options. the constraint for them as if they want to spend more than is being proposed today and as i say, almost certainly, what we will hear will imply some public service spending cuts after the next election. if the next government wants to avoid those cuts then they are probably going to have to find some way to raise taxes. that may be undoing the kind of tax cuts we may hear about today are raising taxes elsewhere or it may be they accept these very tight spending plans. the truth is, whoever wins the next election is going to have some really tough choices to make. pauli really tough choices to make. paul johnson from _ really tough choices to make. paul johnson from the _ really tough choices to make. paul johnson from the institute for fiscal studies. thank you very much for the moment. now, plenty more budget coverage to come through the day here on bbc news. we are running a live page on the bbc news website which has regular updates on all the ins and outs this morning before the chancellor speaks at 1230 in the house of commons behind me. but first lets check in with some of the day's other news: joe biden and donald trump are looking increasingly likely to go head—to—head again in the us elections this november. it's after the biggest day of voting so far — known as super tuesday — as millions of people choose