Borrowing is expected to be £108 billion this year – £12 billion less than forecast a year ago, the Chancellor has revealed.

OBR predicts borrowing will fall to £95 billion in 2014/15, then £75 billion £44 billion and £17 billion in subsequent years with a surplus of almost £5 billion in 2018/19.

Borrowing forecasts mean the UK will borrow £24 billion less than previously predicted over the period.

OBR has revised down national debt to 74.5% of GDP this year, then 77.3% next year reaching a peak of 78.7% in 2015/16 and falling to 78.3%, 76.5% and 74.2% in following years.

Chancellor George Osborne told MPs: “Faster growth alone will not balance the books... there will have to be more hard decisions, more cuts.”

Mr Osborne said this financial package would ensure that “hardworking people keep more of what they earn – and more of what they save”.

“Yesterday we set out our support for parents with tax-free childcare,” he said.

“Today support for savers is at the centre of this Budget, as we take another step towards our central mission: economic security for the people of Britain.”

He said the OBR was forecasting that the economy would surpass its pre-crisis peak later this year.

The OBR was forecasting the deficit would be lower than expected this year at 6.6% - and the Government will post a surplus of 0.2% in 2018/19.

“There were those who said repeatedly that the deficit was going to go up.

“Instead I can tell the House that the Office for Budget Responsibility have revised down the underlying deficit in every year of their forecast,” Mr Osborne said.