BUDGET 2013: Offers 'never-ending austerity'

The Chancellor praised a rise in private-sector employment, even while he devastates the ranks of public-sector workers.

Among his handouts were a 1 per cent cut in corporation tax, lowering it to 20 per cent from 2015, and several tax breaks on share-sellers and investors.

But Socialist Economic Bulletin's Michael Burke told the Star that these measures will do nothing to tackle Britain's deficit.

"What the government is offering is never-ending austerity," he said.

"For this coalition recovery is always something that is on the horizon when all the while we are faced with a recession twice as long as the Great Depression.

"Offering carrots to businesses by cutting corporation tax will not encourage them to invest because they won't be certain of making profits.

"Cutting their taxes on non-existent profits is not going to change that. The state needs to take the lead to provide real economic growth."

British Chambers of Commerce director general John Longworth said that most of Mr Osborne's measures benefited big companies, while smaller firms would have to wait until 2015 for help, "which is too late."

But the flip-side to the Chancellor's business-friendly Budget was more belt-tightening for the public-sector, with the 1 per cent cap on workers' pay extended until 2015.

And he said most government departments will see their budgets cut by 1 per cent in each of the next two years.

Meanwhile economists remained unimpressed by plans to give the Bank of England room to loosen monetary policy by focusing more on economic growth and the freedom to explore "unconventional" measures.