George Osborne claimed Britain was “walking tall again” as he set out his final Budget before the general election.
In a nod to the May 7 poll, he said Britain was facing a “critical choice” as he highlighted economic successes.
Mr Osborne said the Office for Budget Responsibility had ticked up its growth forecast for this year – to 2.5% compared to the 2.4% it was predicting at the time of the Autumn Statement in December.
Winners and losers from this year’s budget
Growth will also be slightly higher next year at 2.3% as against a previous forecast of 2.2%, he said.
He told MPs: “Today, I report on a Britain that is growing, creating jobs and paying its way. We took difficult decisions in the teeth of opposition and it worked – Britain is walking tall again.”
He said that after a collapse greater than almost any country five years ago, in the last year the UK has grown faster than any other major advanced economy.
He went on: “Five years ago, millions of people could not find work. Today, I can report: more people have jobs in Britain than ever before.
“Five years ago, living standards were set back years by the Great Recession. Today, the latest projections show that living standards will be higher than when we came to office.
“Five years ago, the deficit was out of control. Today, as a share of national income it is down by more than a half.”
And he added: “The critical choice facing the country now is this: do we return to the chaos of the past? Or do we say to the British people, let’s go on working through the plan that is delivering for you?”
Claiming austerity would be ending a year earlier thanks to the Government’s policies, Mr Osborne declared: “The hard work and sacrifice of the British people has paid off. The original debt target I set out in my first Budget has been met.
“We will end this Parliament with Britain’s national debt share falling. The sun is starting to shine – and we are fixing the roof.”
And in a dig at Labour he said: “The bank sales, lower debt interest and lower welfare bills presents us with a choice. We could treat it as a windfall, even though we know the public finances need further repair.
And with an election looming, some of my immediate predecessors may have been tempted to do this.
“But that would be deeply irresponsible. We’d be spending money we didn’t really have.”
He said the OBR was predicting that debt as a share of GDP will fall from 80.4% in 2014-15 to 71.6% in 2019-20.
He told MPs: “Because the national debt share is falling a year earlier than forecast at the Autumn Statement – the squeeze on public spending ends a year earlier too.
“In the final year of this decade, 2019-20, public spending will grow in line with the growth of the economy. We can do that while still running a healthy surplus to bear down on our debt.”
The four-year-long fuel-duty freeze has been extended into the autumn by the chancellor.
George Osborne said the fuel duty rise scheduled for September had been cancelled – a move welcomed by motoring groups.
The chancellor further pledged to reduce the taxpayers’ stake in Lloyds Banking Group.
Declaring “this is the Budget for Britain, the comeback country” the Chancellor concluded his Budget statement at 1.31pm.
Labour leader Ed Miliband started his response with: “This is a Budget people won’t believe from a Government that’s not on their side.”
The Labour leader said there had never been such a large gap between the Chancellor’s rhetoric and the reality of people’s lives.
He condemned George Osborne for failing to mention investment in the NHS or public services.