Spending Review 2015: The Key Points

George Osborne has been laying out his plans for the British economy in the Spending Review. Here are the key points from his speech.

ECONOMY

:: Debt over coming years expected to be lower than forecast in July. That is thanks to stronger tax receipts and lower debt interest payments.
:: It means a £27bn improvement in public finances over the forecast period, borrowing £8bn less than had been forecast. There will be £12bn more spent on infrastructure investment.
:: OBR predicts GDP growth of 2.4% this year, unchanged on July forecast. For 2016 it has been revised up to 2.4% (from 2.3%).
:: Borrowing is expected to be £73.5bn in the current fiscal year, increasing from previously expected £69.5bn. By 2019/20 there is expected to be a surplus of £10.1bn (up from £10bn).

TAX CREDITS

:: Controversial plans to cut tax credits have been scrapped.
:: Mr Osborne said: "Because I’ve been able to announce an improvement in the public finances, the simplest thing to do is not to phase these changes in, but to avoid them altogether."
:: Tax credits are being phased out anyway in favour of universal credit, the Chancellor said. So there will be no change to taper rates at which tax credits start to be reduced, or to income thresholds at which they stop applying.
:: It means the Government will not be within its self-imposed cap on welfare spending in first few years but should be later in the Parliament.

WORK AND PENSIONS

:: Department budget to be cut by 14% including by reducing size of real estate and "co-locating" job centres with local authority buildings.
:: Chancellor confirms state pension to rise by £3.35 to £119.30 a week.
:: Apprenticeship levy set at 0.5% of employers' pay bill, raising £3bn a year.

POLICE

:: No cuts for the police budget. "The police protect us, and we’re going to protect the police," Mr Osborne said.
:: New fund to help police deliver savings as different forces "merge their back offices and share expertise".
:: Counter-terrorism budget to increase by 30%.

TAX ABUSE

:: New penalties for abuse plus action on "disguised remuneration schemes" and stamp duty avoidance.
:: £800m invested in fight against tax evasion – to see a return of almost ten times in terms of tax collected.
:: Every individual and small business to have their own digital tax account to manage tax online. Once these are up and running, from 2019, capital gains tax will require to be paid within 30 days of completion of any residential property disposal.

NHS

:: Budget to rise from £101bn today to £120bn by 2020/21. This is "the largest investment in the health service since its creation".
:: It means £5bn more research, 800,000 more elective hospital admissions, 5 million more outpatient appointments, 2 million more diagnostic tests.
:: New hospitals in Cambridge, Sandwell and Brighton and Brighton, and cancer testing in four weeks - plus a "brilliant NHS available seven days a week".
:: Grants for student medics, including nurses, to be scrapped and replaced by loans. The cap on nurse training places will also go, with the aim of increasing numbers by 10,000.

SOCIAL CARE

:: Local authorities given power to add 2% to council tax to pay for adult social care - bringing £2bn more into the care system.

HOUSING
::Aim to build 400,000 affordable homes through doubling of Housing budget with support from stamp duty surcharge for buyers of second homes and buy-to-let investors.
:: New London Help-To-Buy scheme – Londoners with a 5% deposit will be able to get an interest-free loan worth up to 40% of a new-build home.
:: Restrictions on shared ownership to be removed and tenants of housing associations starting to be given right to buy own homes.

EDUCATION

:: 500 new free schools and university technical colleges, £23bn invested in school buildings and 600,000 new school places.
:: From 2017, 30 hours of free childcare for working families with three and four year olds. But extra support is only for parents working more than 16 hours a week and with incomes less than £100,000.

JUSTICE

:: Under-used courts to close and old Victorian city jails to be sold off to create more space for housing. London’s Holloway, the biggest women’s jail in western Europe, to close.

OVERSEAS AID

:: Britain will meet commitment to spend 0.7% of GDP on development. Overseas aid budget to rise to £16.3bn by 2020.

CULTURE

:: Department of Culture, Media and Sport to see budget cut by 5% but more cash for Arts Council, museums and galleries.

BUSINESS

:: Department for Business to see budget cut by 17% but science budget to rise to £4.7bn.
:: Help for 600,000 businesses by extending small business rate relief scheme.
:: Reforms to compensation culture around minor motor injuries to remove £1bn from the cost of providing motor insurance. Motorists should see £40-50 a year off bills.

DEFENCE

:: Budget to rise from £34bn today to £40bn by 2020/21. Britain committed to spending 2% of income on defence.

FLOODS

:: More than £2bn to protect 300,000 homes from flooding.

TRANSPORT

:: Rail electrification for Trans-Pennine, Midland and Great Western lines go ahead. Transport for North to be set up. London to get £11bn investment in transport infrastructure.
:: Department for Transport's operational budget to fall by 37%. But transport capital spending up 50% to £61bn "the biggest increase in a generation". It will fund "the largest road investment programme since the 1970s".

LOCAL GOVERNMENT

:: Local government sitting on property worth quarter of a trillion pounds - and will be allowed to spend 100% of receipts from any of those assets if they are sold. Councils will also be encouraged to draw on growing reserves to pay for reforms.
:: Local government to keep all revenue from business rates by end of Parliament - and central government grant to councils scrapped.

CENTRAL GOVERNMENT

:: Government spending, now 40% of national income, to fall to 36.5% by end of five year period.
:: The cost of all Whitehall administration cut by £1.9bn, part of £12bn savings from Government departments.
:: Day-to-day spending of Government departments to fall by an average of 0.8% a year in real terms.