Philip Hammond has delivered his first spring statement. Here are the key points, with political analysis • Spring statement 2018 - live blog

This article is more than 2 years old

This article is more than 2 years old

Growth

•Forecast of 1.5% growth for 2018, revised up from 1.4%.

•In 2019 growth is forecast to be 1.3%, then 1.3% in 2020, 1.4% in 2021, and 1.5% in 2022.

•In November, growth was forecast at 1.3% for 2019, 1.3% for 2020, 1.5% in 2021, and 1.6% in 2022.

Peter Walker, political correspondent: The start of the statement has seen Hammond at his most political – and defiantly upbeat. He accuses Labour of ‘talking Britain down’ and, making fun of his Eeyore image, saying he is ‘positively Tigger-ish’ in his outlook. All very well – but will it resonate with those people still experiencing stagnant wages?

Borrowing

•Forecast for borrowing of £45.2bn in 2017-18, revised down from £49.9bn. That is equivalent to 2.2% of GDP.

•Borrowing is forecast to be 1.8% of GDP in 2018-19, 1.6% in 2019-20, 1.3% in 2020-21, 1.1% in 2021-22, and 0.9% in 2022-23.

•A small current surplus is forecast for 2018-19, meaning the government would only have to borrow to fund capital investment, and not day-to-day spending

PW: As expected, Hammond has some cautiously positive news on borrowing, calling it ‘a turning point in this nation’s recovery’. Again, he is overtly party political, blaming the deficit on the last Labour government and saying a Corbyn government would increase the debt again. We even get two mentions of Hammond’s favourite current phrase of ‘light at the end of the tunnel’.

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Debt

•Debt is forecast to fall as a share of GDP in 2019-2020, a year later than forecast in November.

•As a share of GDP debt is forecast to be 85.6 in 2017-18, 86.5% in 2018-19, 85.1% in 2019-20, 82.1% in 2020-21, 78.3% in 2021-22, and 77.9% in 2021-22

Spending

•Chancellor says he will increase public spending and investment in years ahead if public finances continue on this improved path. Confirms detailed spending review in 2019.

PW: Hammond returns to another of his favourite phrases, saying he takes a ‘balanced approach’ on extra spending versus reducing the deficit. This is still sensible Phil, even though he hints at possible extra spending after 2020. He quotes several large numbers on investment in schools, the NHS and social care. But again, he faces the problem: does this coincide with what voters are actually experiencing?

Skills

•£500m for T-levels and £50m to help employers roll out placements for T-level students.

•£80m to support small businesses engaging apprenticeships.

PW: In announcing new measures to seek to boost productivity, Hammond remains very party political, with attacks on John McDonnell, the shadow chancellor. He calls the Conservatives the voice of business. This might generally be seen as the case, but it’s worth remembering that most big business groups, such as the CBI, are currently pretty worried about the government’s Brexit plans.

Small businesses

•Chancellor brings forward the next business rates revaluation from 2022 to 2021.

•Review into how to help the least productive businesses catch up with the most, and how to eliminate late payments to small businesses.

Housing

•Government has reached a deal with the West Midlands for 215,000 new homes by 2030-31, with the help of a £100m grant from the land remediation fund.

•Housing growth partnership - which provides financial support for small housebuilders - will be more than doubled to £220m

PW: Amid some general talk about infrastructure spending Hammond singles out spending on housing – seen as a major political problem for the government – for detailed attention. This follows Theresa May’s big speech on housing last week. The one announcement – of a deal for 215,000 new homes by 2030 – is with the West Midlands, which happens to have a Conservative mayor, Andy Street.

Plastic waste

•Chancellor announces call for evidence to tackle need to reduce plastic waste, including a look at alternative materials; how the tax system can drive technological and behavioural change.

•£20m of funds available now to businesses and universities to stimulate new thinking on the subject.

Air quality

•Consultation on reduced vehicle excise duty for the greenest vans on the road

Digital connectivity

•First wave of funding allocated to help roll out high-speed broadband to local areas, as part of the £190m challenge fund. About £95m allocated to 13 areas across the UK.

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Role of cash

•As more people choose digital payments over cash, the government is seeking views on how to make sure people who need to pay with cash are able to pay with cash, and how to prevent the use of cash for tax evasion and money laundering.

VAT

• The government will consult on a new VAT collection mechanism for online sales, to ensure the VAT paid by consumers reaches the Treasury.

Northern Ireland tourism

• The government is seeking evidence on the impact of VAT and air passenger duty on tourism in Northern Ireland.

Summary