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UK growth 'better than expected' UK growth 'better than expected'
(20 minutes later)
The British economy is expanding faster than expected, Chancellor Gordon Brown has told MPs.The British economy is expanding faster than expected, Chancellor Gordon Brown has told MPs.
Mr Brown has revised his 2006 forecast upwards to 2.75%, from last year's Budget predictions of 2-2.5%.Mr Brown has revised his 2006 forecast upwards to 2.75%, from last year's Budget predictions of 2-2.5%.
Mr Brown, who is expected to become prime minister next year, is delivering his 10th and possibly final pre-Budget report in the House of Commons.Mr Brown, who is expected to become prime minister next year, is delivering his 10th and possibly final pre-Budget report in the House of Commons.
He is expected to focus on education spending and "green" taxes such as fuel and air passenger duty. He announced a boost for skills training and committed to making every home "zero carbon".
He told MPs the UK was performing better than its major competitors. Mr Brown told MPs the UK was performing better than its major competitors, apart from the US, and the country was enjoying the "longest period of sustained growth in our history".
But he also stressed the importance of investment in education and training if Britain is to compete with countries such as China and India.But he also stressed the importance of investment in education and training if Britain is to compete with countries such as China and India.
PRE-BUDGET PREDICTIONS Economic growth to meet or exceed targetFuel duty to be re-linked to inflationAir passenger duty tax increaseFuture education spending plans to be unveiledCrackdown on music and film piracyPRE-BUDGET PREDICTIONS Economic growth to meet or exceed targetFuel duty to be re-linked to inflationAir passenger duty tax increaseFuture education spending plans to be unveiledCrackdown on music and film piracy
Universities will receive £60m a year for applied research with commercial potential to help British science to transform knowledge into new jobs.
Former director general of the CBI, Sir Digby Jones, has been made the government's skills envoy, said Mr Brown.
EducationEducation
Trend growth will be maintained at 2.75%, while the public finances will be based on a rate of 2.5% Mr Brown said trend growth will be maintained at 2.75%, while the public finances will be based on a rate of 2.5%
Mr Brown has said public spending growth will slow over the next few years. And he forecast economic growth next year of 2.75% to 3.25%.
But with all eyes on next summer's comprehensive spending review, he is unlikely to announce any major tax or policy decisions.
He will, however, unveil details of the government's spending plans for education for England, which will build on measures already announced to increase spending on buildings and infrastructure.
HAVE YOUR SAY I want to see an increased winter fuel allowances for our pensioners Paul, London Send us your commentsHAVE YOUR SAY I want to see an increased winter fuel allowances for our pensioners Paul, London Send us your comments
He is also expected to unveil green measures in an attempt to steal back the initiative on the environment from Tory leader David Cameron.He is also expected to unveil green measures in an attempt to steal back the initiative on the environment from Tory leader David Cameron.
Speculation has focused on the possible taxes on the most polluting cars and for air travel, after the Stern review in October on climate change warned that action was necessary to combat global warming.Speculation has focused on the possible taxes on the most polluting cars and for air travel, after the Stern review in October on climate change warned that action was necessary to combat global warming.
The chancellor will also respond to some of the major Treasury-commissioned reviews which have reported over the past week. The chancellor is also responding to some of the major Treasury-commissioned reviews which have reported over the past week.
'Wizard of Oz''Wizard of Oz'
Ahead of the speech the chancellor was denounced by his Conservative shadow George Osborne as a "Wizard of Oz" chancellor, whose loud boasts of economic success masked actual failure.Ahead of the speech the chancellor was denounced by his Conservative shadow George Osborne as a "Wizard of Oz" chancellor, whose loud boasts of economic success masked actual failure.
"It looks impressive but when you pull back the curtain there he is pulling levers that are not actually connected to the real world," he told BBC News 24."It looks impressive but when you pull back the curtain there he is pulling levers that are not actually connected to the real world," he told BBC News 24.
Liberal Democrat treasury spokesman Vince Cable said his party's research suggested wasteful government spending was now exceeding £30,000 a minute.Liberal Democrat treasury spokesman Vince Cable said his party's research suggested wasteful government spending was now exceeding £30,000 a minute.
"Gordon Brown's legacy may be to leave his successor with two enormous problems - personal debt and government waste," said Mr Cable."Gordon Brown's legacy may be to leave his successor with two enormous problems - personal debt and government waste," said Mr Cable.