Budget 2016: Osborne "to miss fiscal target"

Weaker growth and delayed sales of government assets expected to contribute to missed target

George Osborne is set to announce he has missed his goal to cut debt as a proportion of GDP this year, according to the Financial Times, as he prepares to unveil further cuts to departmental spending.

The chancellor will outline the Office for Budget Responsibility's updates to growth and borrowing projections when he delivers his Budget statement at 12:30pm.

In November, debt as a percentage of GDP for 2015/16 was expected to be 82.5%, down from 83.1% last year.

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But the FT says that weaker growth and delayed sales of some government assets means the figure is likely to come in above that 83.1% figure.

Cutting debt-to-GDP was one of three fiscal rules set by Osborne after the Conservative election victory.

He has already breached another of those rules, a limit on welfare spending, after a U-turn on tax credits cuts in the Autumn Statement.

The final rule is that the public finances should be in surplus by 2020.

Osborne confirmed at the weekend that he was preparing to unveil a further £4bn of public spending cuts,after growth was revised down from earlier OBR estimates and against the backdrop of a slowing world economy.

Academies push

Elsewhere in today's Budget, Osborne is expected to confirm plans to turn every state school in the country into a semi-independent academy, free from local authority control, by 2020.

He will also pledge to allow secondary schools in England to bid for new funding so they can provide at least an extra five additional hours of lessons or extra-curricular activities like sport or art every week.

The chancellor said: "It is simply unacceptable that Britain continues to sit too low down the global league tables for education. So I’m going to get on with finishing the job we started five years ago, to drive up standards and set schools free from the shackles of local bureaucracy.

"I also want to support secondary schools that want to offer their pupils longer school days with more extra-curricular activities like sport and art. So we’ll fund longer school days for at least 25 per cent of all secondary schools."

But Kevin Courtney, deputy general secretary of the National Union of Teachers, said the plans to bring secondaries under Department for Education control would "undo over 50 years of comprehensive public education at a stroke".

CSW will be providing live coverage of the Budget statement from 12:30pm – sign up for our free e-mails and receive a round-up of the key announcements and reaction this afternoon

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