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Britain’s poorest households are set to lose £715 a year, while the richest gain £185 as a result of Philip Hammond’s Budget, a leading think-tank reported today.

Analysis from the Resolution Foundation found that changes to tax and benefits will hit the poorest hardest and drive up inequality.

The study, published this morning, found Britain faces the longest period of falling living standards since records began in the 1950s.

And according to the Foundation’s calculations, the Chancellor’s headline-grabbing cuts to stamp duty for first-time buyers could have supported the building of 40,000 social rented properties.

(Image: PA)

They estimate the stamp duty cut will cost £160,000 for every new home owner it will create, meaning the Chancellor could have bought each of them a typically priced house outright in a quarter of local authorities and it would have cost the country less money.

It comes after the Office for Budget Responsibility (OBR) delivered a gloomy forecast for Britain’s growth alongside Hammond’s no-hope Budget.

The economy is set to be £42 billion smaller in 2022 than economists believed it would be just eight months ago, with productivity growth slower than at any time since 1812.

Torsten Bell, the Resolution Foundation’s Director said the OBR had “handed down the mother of all economic downgrades pushing up borrowing for the Treasury.”

(Image: PA)

He added: “Faced with a grim economic backdrop the Chancellor will see this Budget as a political success. But that would be cold comfort for Britain’s families given the bleak outlook it paints for their living standards.

“Hopefully the OBR’s forecasts will prove to be wrong because, while the first sentence of the Budget document reads ‘the United Kingdom has a bright future’, the brutal truth is: not on these forecasts it doesn’t.”

Last night, Labour’s John Healey said: “There is no extra Government investment in new affordable homes, no action to help private renters with soaring costs, and just three small-scale pilots to help the homeless.

“Cutting stamp duty, without the significant increase in house-building that Labour promised, will only drive up prices, rather than help the millions of young people who want to buy a home of their own.

“After seven years of failure on housing, which has seen homelessness double, home-ownership fall to a 30-year low and the lowest number of new social rented homes since records began, the country needed much better than this Budget offered.”