FIRST AIRED: March 8, 2017

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00:00:00
>> A red box of upbeat but cautious information. The UK finance minister delivering his first budget on Wednesday. Philip Hammond announcing the economy is on course to grow this year. But despite this initial resilience, the Chancellor also warning Britain's likely to feel the financial impact of the Brexit vote in the coming years.
00:00:20
As Reuters Bill Schomburg in London.>> Phillip Hammond was quite careful to make sure the message got out there, that he wouldn't be spending a lot of the windfall that was coming his way from the solid response to the economy, last year to the Brexit votes. He's probably quite happy to see that the growth forecast for 2017 has been revised up pretty sharply to 2% this year.
00:00:41
But thereafter, for the following three years, growth is actually gonna be a little bit lower than the Office for Budget Responsibility was thinking. So it's certainly a mixed message for the Chancellor, and he's said he doesn't want to change his priorities, his strategies about bringing down a deficit based on short term fluctuations and what's going on with the economy.
00:00:58
>> The Chancellor announced high rates of national insurance contributions for freelance workers and made it harder for directors, and owners of small firms to take money out tax free as dividends.>> He's not completely impervious to political pressures. 2 billion pounds more was announced for funding for social care.
00:01:17
So that clearly shows that he is concerned about the impact of spending restraint on Britain. It's been going on for a quite a long time now, we've got a few more years of it yet. But he was also quite clear to point out that any increase in spending was gonna be sort of offset by other measures in the budget.
00:01:31
So it's a neutral budget, he's not giving much away here.>> Hammond says Britain's budget deficit is likely to fall much faster than previously thought. Most of that though, due to the sharp improvements in the 12 months to the end of March this year. The British economy may have continued to confound the commentators by withstanding June's referendum shock.
00:01:52
But there are many more challenges just around the corner.