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The Treasury also estimates that it will be able to recoup up to 5 billion pounds in lost tax by 2015-16 thanks to a new agreement with Swiss banking authorities.

Osborne also announced several capital investment projects including tax incentives to promote the production of shale gas. At the same time, the Department of Energy and Climate Change announced plans to build more gas-fired generating plants to replace aging coal, nuclear and gas plants. A 1 billion pound loan was also announced to extend the London tube network.

“While the U.K.’s safe-haven status still looks secure, today’s statement does nothing to alter the poor fiscal and economic outlook,” said Vicky Redwood, chief U.K. economist at Capital Economics.

Osborne said the government was considering allowing stocks and shares ISA (tax-deferred individual savings accounts) in smaller stock markets such as AIM, which lists smaller companies with less traded shares.

Flora Maudsley-Barton, director of Parsonage Financial Planning, called the idea “borderline crazy.”

“The vast majority of investors don’t understand ‘illiquid,’ but they will do so very quickly if they go down this route,” she said.

Coming days will tell whether any parts of the budget plans backfire against the government, as happened with the budget announced in May.

Osborne then presented a series of unpopular measures that not only gave a tax cut to the wealthiest taxpayers, but eventually led to embarrassing reversals on his plans to raise taxes on hot meat pies, reduce tax relief for charitable donations, and to go ahead with a hike in the tax on auto fuels.