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Chancellor set to announce £2.5bn cuts in a Budget ‘to tackle the economy’

Chancellor George Osborne will announce an additional £2.5bn of Whitehall cuts when he presents the 2013 Budget at 12.30pm today.

The Chancellor will outline the details of the additional 2% departmental spending cuts, to be spread over the next two years, with the money set to be spent on infrastructure projects.

George Osborne has been under increasing pressure to cut taxes and increase spending in a bid to boost the economy, and the latest economic forecasts from the Office for Budget Responsibility are likely to be negative.

However, despite the growing pressure, and the recent loss of the UK’s AAA credit rating, the Chancellor has insisted that the Government will stick to its reduction plan.

Posting his first ever message on Twitter, George Osborne commented, ‘Today I’ll present a Budget that tackles the economy’s problems head on helping those who want to work hard and get on’.

Business groups have urged the Chancellor to take action on business taxes, including an acceleration in the planned reduction in the main rate of corporation tax, and many economists are predicting that the Government will announce a further increase in the personal tax allowance, to reach the Coalition’s target of £10,000.

In the run-up to the Budget, the Government announced plans to allow some working parents to claim back up to £1,200 a year in childcare costs, with effect from 2015.