Britain has raised its forecasts for economic growth this year but is more downbeat about the following three years, finance minister Philip Hammond said in the first full budget since the referendum decision to leave the European Union. David Pollard reports.
BROADCAST AND DIGITAL RESTRICTIONS~** Broadcasters: NONE Digital: NONE ** Red budget briefcase ... but no red alert - or not yet. For now at least, Britain continues to 'confound the commentators'. Says its finance minister - as he gave his first budget speech - and probably his last before the UK triggers its Brexit divorce. (SOUNDBITE) (English) UK FINANCE MINISTER, PHILIP HAMMOND, SAYING: "Reflecting the recent strength in the economy, the OBR has upgraded its forecast for growth this year from 1.4 percent to 2 percent. But there are hints of darkness about a future he called 'brighter'. Growth over the next three years: downgraded from previous forecasts. Though Hammond - or Spreadsheet Phil as he's nicknamed - ruled out extra spending - in favour of building up reserves. (SOUNDBITE) (English) UK FINANCE MINISTER, PHILIP HAMMOND, SAYING: "We cannot rest on our past achievements. We must focus relentlessly on keeping Britain at the cutting edge of the global economy. The deficit is down, but debt is still far too high." The challenge he faces, say economists, is there's no spreadsheet yet for just how much Brexit might hurt the British economy. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "I think it's probably prudent for a rather dull accountant to actually make sure he's actually got some reserves available and make some suitable amounts kept up the sleeve just in case." Nor can Hammond do the books yet for a possible downturn in consumer sentiment. Or investment. (SOUNDBITE) (English) CHIEF ECONOMIC ADVISER, CEBR, VICKY PRYCE, SAYING: "In the last quarter of 2016, when in fact the economy grew by about 0.8 per cent, which is really quite significant, we actually saw business investment fall. And that reflects to a considerable extent worries about Brexit." A stronger economy, Hammond said, does mean not so much borrowing. The nearly 24 billion pounds less he predicts over the coming five years more padding for Britain's Brexit safety mat.