Battle for the North in pre-election Budget

The Chancellor set out a package of devolution and job creation measures aimed at securing a Tory win in key marginal seats across the North, boasting that under his economic stewardship “the great county of Yorkshire” alone had created more jobs than the whole of France and adding that “over the last year, the North grew faster than the South”.

It was part of a deeply political budget in which Mr Osborne offered financial goodies to taxpayers, savers and home-buyers savers as he declared that Britain could “walk tall again” after years of austerity.

The Northern focus included confirmation of a devolution package for West Yorkshire and a promise to set out this week how the Government will pay for a High Speed 3 rail network linking Leeds to Manchester in a transport for the north strategy.

But the Chancellor is facing increasing accusations of a Lancashire -bias as he once again announced extra funding for the multi-billion pound Greater Manchester metro mayor project.

Mr Osborne said he “will build on London’s success by building the Northern Powerhouse” with more than £15m worth of regional projects as well as £3.5m for overseas regional trade missions.

Conservative now MPs believe they will go into the General Election as the only party armed with a set of Northern specific manifesto commitments, a move which angered Ed Miliband as he rose to respond to the Chancellor.

The Labour leader said: “Let us talk about what the Chancellor has done to the north of England. Let us test whether he is a friend of the north—75 per cent bigger cuts to local government budgets in the north than in the rest of the country.

“The Chancellor was praising northern councils in his statement. Let us see what they have to say.

“The leader of Leeds council says that the Chancellor ‘fails to deliver the devolution we need. This Government is no friend of the north.’”

The Chancellor outlined a series of measures aimed at challenging Labour’s claims of a cost of living crisis head on as he delivered an effective tax cut to 27 million voters - and took 3.7 million out of income tax altogether - by announcing rises to £11,000 in the personal allowance and £43,300 in the threshold for the 40p higher rate.

He also abolished tax on the majority of savings accounts with a new £1,000 tax-free allowance, and offered Government help worth up to £3,000 for first-time home-buyers saving for a deposit, through the creation of a new Help to Buy Isa.

Mr Osborne attempted to kill off claims that the Tories would take spending back to 1930s by declaring that by 2020 public spending would be at the same level as 2000 - when Tony Blair was in 10 Downing Street.