Budget: George Osborne Leaves Downing Street

By Jon Craig, Chief Political Correspondent

George Osborne has left Downing Street with his Budget, which he vows will help people "work hard and get on".

The Chancellor showed off his red box on the steps of Number 11 before heading across to Parliament.

Earlier he joined Twitter and posted a picture of himself apparently putting the finishing touches to his speech.

A Twitpic shows George Osborne at work

He wrote: "Today I'll present a Budget that tackles the economy's problems head on helping those who want to work hard & get on."

The financial statement comes as Mr Osborne is under intense pressure over the lack of growth and his own dwindling popularity.

He was dealt a fresh blow this morning as new figures showed unemployment rose 7,000 between November and January - the first rise in the jobless rate for a year.

Meanwhile, public sector workers have mounted a 24-hour strike to coincide with Budget day as they continue a bitter row over pay, pensions and working conditions.

Mr Osborne's statement at lunchtime will have the twin aims of trying to rescue the British economy and the political fortunes of the Conservative Party.

He will announce a raft of measures he hopes will not only kick-start economic growth but also reverse a Tory slump that began with his Budget a year ago.

Many Tories blame 2012's "omnishambles" statement containing a series of blunders that required embarrassing U-turns for the collapse in the party's support.

Further questions have been raised about the Chancellor since Britain lost its AAA credit rating and slipped into a double dip recession, with the risk of a triple drip still alive.

Labour leader Ed Miliband warned on Wednesday that Britain did not want "more of the same". "What we don't need is him saying I'm going to stick to my failed plan," he said.

But despite lower growth forecasts and a rise in borrowing set to be confirmed in the statement, Mr Osborne is expected to insist there can be no shift from austerity.

He has already promised help for pensioners, working couples and homebuyers but will also need to tackle fuel duty and encourage businesses to invest to avoid another onslaught from critics.

On tax, the Chancellor is tipped to help the low paid by accelerating raising the income tax threshold to £10,000, a move championed by the Tories' Lib Dem Coalition partners.

And after the furore in the Conservative Party over gay marriage, the Chancellor may boost the married couples' allowance to cheer up disgruntled Tory backbenchers.

A cut in corporation tax from 21p to 20p would also delight business leaders.

Mr Osborne is also expected to agree to unlock £4.8bn in child trust funds and allow parents to transfer their investments into more generous Junior ISAs. This move could leave some children up to £34,000 richer.

And he will announce that thousands of elderly people who lost up to half of their life savings when Equitable Life came close to collapse a decade ago will receive compensation.

But in a bleak message to MPs and voters on the state of the economy, there will be no U-turn on spending cuts or unfunded tax cuts and some grim economic forecasts.

Mr Osborne has defied calls from Lib Dem Cabinet colleague Vince Cable and former Tory defence secretary Liam Fox to change course and abandon his so-called "Plan A".

Warning that economic recovery would be a slow process, he said: "There is no easy answer to Britain's problems. There is no miracle cure, because of course if there was a miracle cure it would have been deployed."

Most government departments have in fact been ordered to cut another 2% from their budgets over the next two years so that the money can be spent on capital projects.

Health, schools, overseas aid and HM Revenue and Customs will be shielded from the latest round of savings, which will give a £2.5bn capital boost.

The Budget comes as a new poll confirmed Mr Osborne's unpopularity.

The survey suggested that more than four out of 10 voters (44%) think he should be sacked as Chancellor.

Fewer than one in five (18%) of those questioned said Mr Osborne should keep his job, while 38% did not know.

Favourite to replace him is Mr Cable, favoured by 12%, followed by Foreign Secretary William Hague (5%) and Home Secretary Theresa May (3%).

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