Welcome to our live coverage of Alistair Darling's first pre-budget report.
We're expecting a clampdown on the private equity industry, more green taxes, and an admission that economic growth will slow down in 2008.
He will also present the comprehensive spending review, laying out the government's spending plans for the next three years.
The chancellor should be on his feet from 3.30pm.
3.15pm
With just a few minutes to go until the PBR begins, the Commons is filling up (currently it's Foreign Office questions) and some advance details have already emerged.
The cabinet heard this morning that the UK won't be derailed by the "global economic uncertainty". Economists still expect a down-grading of growth forecasts next year, though.
3.30pm
And we're off. Alistair Darling is on his feet and starting to deliver his first pre-budget report. Will we get Daring Darling, or will he live up to his reputation in Westminster as the government's fire blanket?
3.35pm
The theme of this speech, he says, is that the UK can survive the current global economic uncertainty. Mr Darling has promised to take no risk with stability.
Economic figures first: as expected, Mr Darling said that the UK will be the fastest growing major economy this year, with growth at 3%.
And he's also revised down the growth forecast for next year, to 2-2.5% (from 2.5-3% before). This is still higher than many economists have forecast.
Plenty of hecking from the opposition, for this downward revision. But, by 2009/10, growth will be back to a healthy 2.5-3%, the chancellor promised.
The chancellor has promised that the government is keeping to its fiscal rules. Public debt of £38bn this year will fall to £23bn in 2012.
He's also claimed that the government will be spending just a third as much on debt repayments and social security as under the Conservatives - proof of his fiscal responsibility, he says.
3.40pm
Moving onto departmental spending, the armed services get another £400m this year.
Mr Darling has announced more funding for security intelligence, which he says has already doubled since 2001. "The terrorist attacks of 2005 remind us all of the constant threat of security in the UK," he said.
Not much detail on what this will be spent on, except that there is £400m to strengthen border security.
Transport gets £14.5bn. This will include paying for the widening of the M1 and M6. There's also more cash for local transport, and a doubling of finance for improving the rail network. This £14.5bn figure also includes financing for London's Crossrail.
3.50pm
And onto tax. It's important that everyone pays their fair share, says the chancellor, to opposition barracking.
Mr Darling is tightening up on the private equity industry, after months of protests over the tax breaks enjoyed by this sector. Taper relief (which lets private equity firms pay just 10% tax on assets owned for at least two years) is being axed.
That should please the unions. Instead there will be a new flat rate of 18%. That's still less than the 40% some critics have called for.
The chancellor now moves to non-domiciled residents who avoid paying tax in the UK.
The Conservatives proposed a flat rate of £25,000 to get non-doms to pay tax. Mr Darling tells the Commons that George Osborne's numbers were wrong.
"Instead of raising £3.5bn, it would raise just £650m," he claims, adding that it would deter vital workers like doctors and nurses from moving to the UK.
Instead, he says he will consult on legislation to fix this problem, and may introduce a charge for non-doms who've lived here for seven years, with a higher rate coming in after they've been here 10 years.
3.55pm
The controversial air passenger duty is being axed by 2009. Instead of being levied on individual customers, it will be charged on flights.
The Tories enjoyed that - they proposed it last week.
Now onto overseas aid, an area where the UK's performance was shameful in the past, says Mr Darling.
He promises to raise overseas aid to £9bn by 2010. "We are on course to meet our commitment of 0.5% of GDP by 2010, and then the UN goal of 0.7%," he vows.
4pm
Mr Darling has just announced changes to the inheritance tax system (where the Tories scored a major win last week with their plan to raise the threshold to £1m).
He's not going that far. Instead, the threshold is going up to £600,000 now, and £700,000 by 2010.
It will be backdated indefinitely for every widow and widower. In future years both house prices and inflation will be taken into account when setting IHT thresholds.
Labour MPs like the sound of that. They like the next bit too...
4.05pm
Mr Darling claims that matching the Tory's plans would cost an extra £2bn. Instead, he's going to put that money into schools and hospitals. Proof that Labour will invest in public services rather than give tax relief to a few, he claims.
"Now let's have a debate on what's affordable. I welcome that debate," he says.
This means education spending will go up by more than the 2.2% announced in March. NHS spending will rise by 4%, underpinning a new guarantee of "maximum of an 18-week wait from referral to hospital".
That 4% rise in health spending is more than analysts expected - but less than the 7% it has enjoyed in recent years, and less than the 4.4% recommended by the Wanless review in 2004.
And with something of a flourish, Mr Darling recommends his budget to the house. Now George Osborne will respond...
4.10pm
The shadow chancellor launches straight into attacks on both the chancellor and Gordon Brown - the latter for not calling a snap election.
"This is a pre-election budget without the election," he protests. "The prime minister took the starting pistol and fired it into his foot."
Mr Osborne, whose policies on inheritance tax helped David Cameron pull off the kind of turnaround familiar to the England rugby team, also attacks the increased investment on health.
This 4% pay rise is less than the NHS needs, he claims. "On top of staggered pay awards and A&E wards closing, the NHS will have to cope with a slowdown in growth."
He adds that Sir Derek Wanless's health review warned that the large increase in NHS spending hadn't delivered the productivity benefits needed. "These are overspun claims," Mr Osborne said.
4.15pm
Alistair Darling is back on his feet waving a piece of paper. He's not declaring peace in our time - instead he claims a Conservative researcher has left a copy of Mr Osborne's crib sheet on a Commons photocopier.
Nothing too dynamite, although it apparently shows that the Conservatives expected a rise in health spending of only 3.5% (as did most forecasters).
4.20pm
Vincent Cable now responds for the Liberal Democrats, prompting a rush for the doors. Mr Speaker admonishes the rudeness of fleeing MPs, and those who take the opportunity for a quick natter.
Like Mr Osborne, Mr Cable also attacks the 4% rise in health spending.
"The Wanless report said that 4.4% was the absolute minimum needed for real change in the health service," he tells a now half-empty chamber.
He also welcomes the review of non-doms, claiming that the Tories' proposal of a flat-rate £25,000 charge wasn't enough.
4.30pm
And that's the end. Thanks for joining me. Stay on the site for more pre-budget report news, analysis, comment and reaction. If you're really keen, you can read the whole pre-budget report on the Treasury website.
