This report by the National Audit Office, made under sections 156 and 157 of the Finance Act 1998, examines the conventions and assumptions underlying the Treasury's fiscal projections within the Pre-Budget Report 2005 (Cm 6701 ISBN 0101670125).

This report by the National Audit Office, made under sections 156 and 157 of the Finance Act 1998, examines the conventions and assumptions underlying the Treasury's fiscal projections within the 2006 Budget (HCP 968, session 2005-06; ISBN 0102937311).

This report by the National Audit Office, made under sections 156 and 157 of the Finance Act 1998, examines the conventions and assumptions underlying the Treasury's fiscal projections within the 2007 Budget (HCP 342, session 2006-07; ISBN 9780102944556).

Audit of assumptions for the 2003 pre-budget Report

The Budget presents an updated assessment of the economy and public finances and reports on Government policies. It: shows that the economy is growing strongly and the Government is meeting its fiscal rules; announces a long-term investment programme for schools and sets out further measures to help young people develop skills; sets out reform to reduce the regulatory burden on business; announces free local travel for people over 60 and provide £200 towards the council tax bill for those over 65; makes a commitment to increase Child Tax Credit in line with earnings; doubles the threshold for stamp duty; increases the special reserve for military operations; announces a better targeted Local Enterprise Growth Initiative; introduces measures to modernise the tax system; defers any increase in fuel duty until September 2005.

The Budget sets out the Government's plans for taxation, public spending and economic growth for the coming year. Details announced include: an annual growth rate of 2.5 per cent for 2006-07 with a forecast of 2.75 to 3.25 per cent for 2007-08; an inflation rate of two per cent this year; and public sector borrowing on course for a £16bn surplus over the economic cycle ending in 2010-11, with net borrowing set at £37 billion for this year and £36 billion next year, falling to £23 billion in the year to 2010-11. Measures announced in the 2006 Budget include: i) the climate change levy to be indexed in line with inflation from 2007, a new vehicle excise duty rate of £210 for the least fuel efficient cars (4x4 cars or SUVs) and the establishment of a new £1bn energy and environmental research institute funded by government and private industry; ii) measures to help to single parents into work and tackle child poverty including an increase in child benefit, child tax credit and childcare vouchers and a top-up to child trust fund accounts at the age of seven; iii) an increase in duty of nine pence on cigarettes and one pence on beer, with a freeze in duty on whisky and other spirits; iv) the exemption on stamp duty raised to £125,000 and a rise in the level of inheritance tax from £275,000 to £325,000; v) the level of investment in schools to rise from £5.6 billion to £8 billion a year; vi) free off peak national bus travel for pensioners in every part of the country; and vii) funding, in partnership with commercial sponsorship, to support top athletes to prepare for the 2012 Olympics.

The 2006 Pre-Budget Report presents updated assessments and forecasts of the economy and public finances; the effects of policies on long-term governmental goals; and reforms being considered ahead of the Budget. It is organised under 6 main headings: maintaining macroeconomic stability; meeting the productivity challenge; increasing employment opportunity for all; building a fairer society; delivering high quality public services; protecting the environment. Amongst the measures discussed are: making Child Benefit available from week 29 of pregnancy; increasing enforcement measures for the National Minimum Wage; a target of 3% savings in central and local government; increasing capital investment in education from £8.3 billion in 2007-8 to £10.2 billion in 2010-11; taking forward recommendations of the Leitch Review on skills (ISBN 0118404865); and an increase in air passenger duty.