Brown announces Budget date

What are his plans for taxes and spending?

Gordon Brown has announced that this year's Budget will be on 17 March.

The annual event provides the chancellor with the opportunity to assess the economy and flag up the government's achievements.

During the closely-watched speech, he also will outline government spending and any adjustments in taxation.

It will be Mr Brown's eighth Budget since Labour won power in 1997 and will be seen by many as central to Labour's bid for re-election.

Concerns

A number of economists, however, have argued that the government may have to raise taxes to meet its ambitious spending plans.

Labour has pledged to pour billions of pounds into ailing public services, particularly schools and hospitals.

According to the Institute for Fiscal Studies, a leading think-tank, the chancellor will have to raise taxes by £10bn by 2006 to meet his fiscal targets.

Mr Brown was recently forced to increase his public sector deficit forecast for this fiscal year to £37bn, up from the £27bn figure predicted in his Budget speech in April.

Under the government's "golden rule", borrowing and current spending must balance out over the economic cycle.

Under control

Mr Brown, however, is confident that accelerating economic growth will boost state revenues and help keep the country's budget deficit under control.

According to recent figures from the Office for National Statistics (ONS), Britain's economy expanded at its fastest rate in almost three years during the final three months of 2003.

Overall, the UK economy grew by 2.1% during 2003, the ONS said.