Philip Hammond has told the Cabinet his Budget will make “significant investments” in infrastructure as he promised to build “a Britain fit for the future”.
The Chancellor briefed senior colleagues, including Prime Minister Theresa May, at Downing Street ahead of the second Budget of the year.
The PM’s official spokesman said the package set out a “balanced” approach to the economy, continuing the work of restoring the public finances while also finding cash for the NHS, public services and house-building.
Mr Hammond’s presentation was “well received” by the Cabinet, with senior ministers including Boris Johnson and Michael Gove speaking in support of his approach, and there was a traditional banging of the table to demonstrate their approval, said the spokesman.
The spokesman added: “The Budget will adopt a balanced approach, continuing to restore the public finances to health while investing in the NHS and public services and tackling the chronic shortage of housing in this country.”
Mr Hammond told colleagues the Budget would set out “a vision for post-Brexit Britain”, showing how the UK can “grasp the opportunities which leaving the European Union provides”, said the PM’s spokesman.
“The Budget will make significant investments for the future in skills, infrastructure and research and development.”
Mrs May told Cabinet that the investments in Mr Hammond’s Budget were made possible by “the hard work and sacrifices made by the British people” since the financial crash of 2007-08.
Mr Hammond’s comments send a strong signal that he hopes the Budget will be seen as starting the process of bringing down the curtain on the age of austerity which has reigned since Conservative-led governments came into power in 2010.
The PM’s spokesman said that, coupled with the Government’s industrial strategy – due for publication on Monday – the Budget would “help to build an economy fit for the future and make the most of the opportunities provided by the technological revolution”.
He added: “The Chancellor also set out the Government’s commitment to build an extra 300,000 homes a year, making prices more affordable and giving more people the opportunity of fulfilling the dream of owning their own home.”
The 75-minute Cabinet meeting came ahead of Mr Hammond’s second Budget statement, which will the first of what are now expected to be regular autumn Budgets.
Mr Hammond’s room for manoeuvre has been limited by surprise figures showing that state borrowing jumped to £8 billion last month, adding to pressure from the Office for Budget Responsibility’s expected downgrade of productivity projections.
As part of the effort to boost the country’s skills to improve long-term productivity, the Chancellor will set out a £177 million plan to give schools and sixth forms in England £600 for every additional student taking A-level maths or core maths qualifications.
A £42 million fund will also support £1,000 of training for every teacher in selected schools in areas that have “fallen behind”.
The director of the Institute for Fiscal Studies, Paul Johnson, said Mr Hammond was caught “between a rock and a hard place” and may be forced to abandon his target of balancing the nation’s books by the middle of the next decade.
Meanwhile, Labour was demanding large-scale investment in infrastructure to boost “sluggish” manufacturing industry, along with new cash for the public services, a major house-building programme and a pause in the Government’s flagship Universal Credit welfare reform.