Chancellor George Osborne delivered his budget for the 2012/2013 fiscal year to parliament on Wednesday.

Following are highlights from his statement.


We are also introducing new allowances including a 3 billion pounds new field allowance for large and deep fields to open up West of Shetland, the last area of the basin left to be developed. A huge boost for investment in the North Sea.


We are also taking the opportunity to rebuild Britain's reserves, which had fallen to historically low levels. I can confirm our gold holdings have risen in value to 11 billion pounds.


The Debt Management Office will consult on the case for issuing gilts with maturities longer than 50 years, and the case for a perpetual gilt with no fixed redemption date - something Britain last felt able to issue six decades ago.


One area where future government spending is expected to be lower than planned is Afghanistan... The cost of operations - which are funded by the Government's Special Reserve and entirely separate from the defence budget - are expected to be a total of 2.4 billion pounds lower than planned over the remainder of the Parliament.


I've also said that we would consider proposals to manage future increases in the state pension age, beyond the increases already announced.


In my first Budget, I set the Government the fiscal mandate of achieving a cyclically-adjusted current balance by the end of the five year horizon.

The OBR confirm today that we are on course to achieve that mandate, and have eliminated the structural current deficit by 2016-17.

They also confirm that we are also on course to reach our target for debt to be falling as a percentage of national income by the end of the Parliament in 2015-16.

Public Sector Net Debt is now set to peak at 76.3% in 2014-15, almost 2% lower than previously forecast - before falling the following year.


The deficit is falling and is forecast to reach 7.6% next year.

Borrowing this year is set to come in at 126 billion pounds, 1 billion pounds lower than I forecast in the autumn. And over 30 billion pounds a year lower than its peak the year before we came to office.

Borrowing will then fall to 120 billion pounds next year, if you exclude the transfer of Royal Mail pension assets. It will then fall to 98 billion pounds in 2013-14; then 75 billion; then 52 billion; reaching 21 billion by 2016-17.

So in total, borrowing is 11 billion pounds less than I last forecast in the Autumn.


The OBR's overall assessment of the outlook and risks for the British economy is broadly unchanged since last November's report.

The OBR expect the British economy to avoid a technical recession with positive growth in the first quarter of this year.

They say that the British economy has carried a little more momentum into the new year than previously anticipated.

Indeed, the Office for Budget Responsibility is slightly revising up in their growth forecast for the UK this year to 0.8%. They then forecast 2% next year; 2.7% in 2014; And 3% in both 2015 and 2016.

(Reporting by UK bureau)