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Minute-by-minute coverage of Alistair Darling's statement and the Commons debate
12.49pm:
There will also be extra funding for six-form places, and Scotland, Wales and Northern Ireland will get funding to pay for equivalent measures.
12.49pm:
As part of this, Darling will spend more than £260m on training and subsidies to help them get work in sectors with strong future demand (ie IT, I guess).
12.48pm:
There will be extra support for people out of work for 12 months through the flexible New Deal.
Darling will also target helping young people, and offers a guarantee: from January, everyone under 25 who has been out of work for 12 months will get a job or training.
That will include delivering local services.
12.47pm:
In March, unemployment increased by 74,000.
It is not in any government's power to prevent job losses, Darling says - but the government can help people to find a new job quickly and retrain.
Today, he's announcing steps to ensure "short-term job loss does not turn into a lifetime on benefits".
An extra £1.7bn funding for job centres and job programmes will be provided.
12.45pm:
Due to the measures announced today, the deficit will halve within four years. But he'll say more about that (ie tax rises) later in the speech.
12.44pm:
From 2011, he is forecasting that the ecnomy will continue to recover, with growth at 3.5%.
That seems very high - there was some surprise in the chamber.
12.43pm:
The sources of growth will be diverse. Other industries are as important as financial services.
12.43pm:
However, he expects growth to resume towards the end of the year. The British economy is resilient, he says, which is why he is confident.
He is forceasting growth of 1.25% for 2010.
12.42pm:
As an open economy, "we are affected by the collapse in demand" around the world.
As a result, Darling says he has reduced his growth estimates.
For the first quarter of this year, he expects the economy to contract by about 1.25%.
For the year as a whole, he expects it to contract by around 3.5%, in line with other forecasts.
12.41pm:
The UK went into the recession with employment at "an all-time high". But no country can insulate itself from a world downturn, the chancellor says.
12.40pm:
At the G20, world leaders agreed over £1 trillion support for the world economy.
There is no quick fix, Darling warns. But, he says, "we can begin to restore confidence" and bring the world out of recession.
Darling wants the next meeting of EU finance ministers to focus on carrying forward the G20 agenda.
12.39pm:
Darling says he understands the anxiety behind calls to support those whose wages are falling (he seems to be referring to the TUC calls for in-work subsidies).
But the govenrment is already taking steps to help famlies in situations like this through tax credits and other measures, he says.
Since October, homeowners with tracker mortgages have saved more than £400 a month because of falling interest rates.
The support the government has already given to the economy is expected to save half a million jobs, he tells the House.
12.39pm:
But Darling says he has taken action to rescue the banks and get credit flowing.
The £20bn fiscal stimulus announced in the pre-budget report is "coming through now". Thousands of jobs are being protected.
12.36pm:
Since last autumn, an international financial crisis has fed into the wider economy, causing a "steep and widespread recession".
UK exports are down 14%, Darling says - but they are down more in other countries.
The global economy is expected to contract this year - the first time this will have happened since the second world war
12.34pm:
The action already taken in the UK, and internationally, means he expects the economy to start growing again "towards the end of this year".
That's his first big announcement of the day. Does he mean the fourth quarter?
12.34pm:
In the 1930s, a failure to act turned a serious downturn into a prolonged recession, Darling says. He will not make the same mistake again.
12.33pm:
The chancellor says that, in all his decisions, he has been guided by his core values: fairness and opportunity.
12.32pm:
Darling gets under way. The budget will help people through the global recession and prepare the country for the future, he says.
He will protect investment in schools and hospitals and other key public services, he tells the House.
12.31pm:
Cameron has been using PMQs as a warm-up for his reply to Darling.
He tried, for the umpteenth time, to get Brown to admit he had not abolished boom and bust - and, for the umpteenth time, he failed.
You can read the exchanges on our PMQs blog.
11.43am: The volume of budget commentary in the blogosphere this morning is getting overwhelming. If you want to read just two pieces that put it in some kind of context, I'd recommend these: Stephanie Flanders on the economics; and Matthew Taylor on the politics.
11.32am: The Institute for Fiscal Studies has just released its comment on today's public finance figures. Gemma Tetlow, a senior research economist at the IFS, said: "In his budget statement later today, the chancellor will confirm that borrowing in the 2008/09 financial year is estimated to have been £90bn, which is £12.4bn higher than his November 2008 pre-budget report forecast. This higher-than- expected borrowing mainly reflects weak tax receipts, in particular VAT and corporation tax. In the budget later today, we will learn how much of this extra borrowing the chancellor thinks is purely temporary and how much he thinks is permanent and whether he has decided to implement fresh tax rises or further cuts to spending plans to deal with it."
11.27am: I've just had a look at the "live coverage" on the Downing Street website. Downing Street can't even get the time right, which does not inspire much confidence. They're using Greenwich Mean Time, not British Summer Time.
Darling has just come out of Downing Street for the traditional Number 11 doorstep photograph with his red box. Gordon Brown got himself a brand new one, but Darling has reverted to the tattered old one (which dates from the time of Gladstone, or someone like that). Supposedly the speech is inside, but when Brown was chancellor one of his aides once told me that the box was empty, and that someone else carries the speech to the Commons. I'm sure there's a metaphor in that somewhere.
11.01am: One of the big policy issues to be resolved today is what Darling will do about top-rate tax relief for pension contributions. The BBC is being briefed that Darling will abolish this relief, but not for everyone on the top-rate tax band, just the very rich. Does that mean £100,000 a year? Or £150,00 a year, the rate at which the new 45p income tax rate will kick in in 2011. This sounds technical, but the sums of money involved are huge; the Lib Dems were saying on Monday that they could raise £6.5bn by abolishing all top-rate tax relief on pension contributions. Another advantage is that, as far as I understand it, it's a tax rise that people would not notice immediately. Unless top-rate tax payers altered their contributions, they would go on paying the same amount into their pension, but the amount going into their pension pot would be lower (because of the missing tax relief). Robert Peston has got a good discussion of the issue on his blog.
10.02am: I'm all in favour of talking up the importance of big parliamentary occasions but even I can't compete with the Sun, which has decided that Alistair Darling is about to deliver "the most important budget of our lifetimes". In its editorial this morning, it declares that the budget will be not just a defining moment for Labour, but also "a defining moment for the United Kingdom as a major world economy".
At the risk of spoiling the fun, I'd advise anyone looking for a more sober analysis to read David Smith's column in the Sunday Times at the weekend. He pointed out that, although last year's pre-budget report involved massive, multi-billion tax changes, most budgets are "modest affairs" and that "unless the signals are wrong, we are back to a 'normal', tinkering budget, even though times are far from normal". On the Today programme this morning, in the 6.20 business slot (when it's sometimes too early to register who's who) some business guru was saying that Darling should simply stand up and announce that he's not changing anything.
Luckily, Darling won't be taking that advice and so we should have plenty to report. I'll be updating this blog from time to time this morning and then going hell-for-leather once Darling starts his statment at 12.30pm. After Darling sits down, David Cameron will reply for the Tories (replying to a budget statement is the most daunting of all parliamentary challenges, because the opposition does not get any advance warning of what's in it) and then Nick Clegg, other party leaders and backbenchers get to have their say. I'll be reporting on those exchanges too.
There's been plenty of reporting, analysis and comment about the budget on this site already and there's no point repeating it here. Let's just say I think there are three issues that really matter:
1. Can Darling convince us that he's right about the recession being over in 2010? I was sitting in the Guardian office when Darling delivered his PBR last year and I don't think any of us believed his forecast about the recession ending in July 2009. It turned out the Guardian political staff were right, and the finest brains in the Treasury were wrong. We know that this afternoon Darling is going to predict modest growth in 2010. Will he persuade people that he's being realistic, or will we be left thinking he's still in denial about the state of the economy?
2. Can Darling convince us that he's got a credible plan to deal with the deficit? We know that the figures for borrowing for this year and for next year are going to be astronomical and Darling has already announced some measures (such as the 45p tax rate) to balance the books over the medium term. He's going to have to say more about this today. Will his figures add up?
3. Finally, can Cameron persuade us that he could do any better?
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