Gordon Brown has insisted that the economy is strong despite announcing that he will borrow a further £10 billion this year.

In a wide-ranging statement, the chancellor insisted the fundamentals of the economy remained prudent and balanced.

"It is sustained economic growth, built on the foundation of long term stability and low debt, that has underpinned our investment plans and makes them affordable for now and the future." he told MPs.

Forum Response: Association of Teachers and Lecturers (ATL)

Dr Mary Bousted, general secretary for the Association of Teachers and Lecturers (ATL) told ePolitix.com: " We are glad to see the government acknowledging the vital importance of early year education. The funding for childcare and nursery places is welcome. The chancellor however concentrates on the quantity of provision but ATL believes that the quality of support is equally critical. In our response last month to the Treasury review of childcare, ATL called for greater investment in the childcare workforce, particularly for training and workload.

"The school parent links which we wholeheartedly support also throw up training and workload issues for education staff required to work with adults."

Forum Response: GMB

Kevin Curran, GMB general secretary reacted to the pre-budget report saying: "The chancellor has focussed on issues at the heart of working communities in particular skills and childcare. Investment in these areas will make the UK stronger and healthier for the long term.

"The move forward on procurement is crucial to the future of British manufacturing because for far too long British workers have lost out as British contacts have gone elsewhere in Europe. We need to move to a situation where British companies are at the forefront of winning British and European contracts.

"I hope that the New Deal for Skills is as successful as the New Deal has been for young people. Having a highly skilled British workforce through time off and training will be key for the long term health of the economy. The chancellor is right to invest in education from the cradle and throughout worker's lives. The GMB will encourage every workplace to take up the tax free opportunities in child care being offered."

Forum Response: Council of Mortgage Lenders

Peter Williams, CML deputy director general, said: "For the first time in a number of years, we now have an authoritative analysis quantifying the deficit in UK housing supply and the reasons for it. Looking ahead to the policy solutions, there will need to be a clear focus on tenure issues. Increasing the supply of rental property will only partially address the problems if the majority of frustrations are among those who wish to own.

"This raises the question about what the government sees as housing policy priorities. Is it more important to increase the supply of rental housing, or to meet the aspirations of those who wish to be home-owners? While the CML sees a need for more rental property, we also believe the government needs to keep firmly in mind that home-ownership is the preference for 80 per cent of the population. Both supply and affordability issues for home-ownership need to take a high priority."

Forum Response: Institute of Directors

George Cox, IoD director general, said: "We welcome the moves to stimulate enterprise and the growth of small businesses. We appreciate that at last there is a growing reaction that over-regulation is stifling business and we are pleased to see that the Government is beginning to respond to our members' strong concerns about the red tape burden.

"However, the big issue is the chancellor's economic forecasts. If his growth projections are not met he could be forced into imposing higher taxes which would be unwelcome and would have a serious negative effect on the economy."

Forum response: Federation of Small Businesses

Financial affairs chairman, Neil Hamper said, "A number of these measures are already known to us and we would urge the chancellor to introduce symmetry into the debate by coupling economic stability with regulatory stability as small firms are hardest hit by the cumulative impact of regulations".

Forum Response: Local Government Association

Sir Jeremy Beecham, LGA chair said: "Local government is getting its message heard. Today's money is more than just a welcome sticking-plaster measure. It points the way to a more fundamental change in local government finance to a fairer, more transparent and accountable system which will allow people to understand better the relationship between council spending decisions and the local tax they have to pay.

"I am optimistic that we are winning a consensus around this point - the challenge has to be to maintain this momentum.

Forum Response: Age Concern England

Age Concern's director-general, Gordon Lishman, said: "It is good news that the chancellor has delivered Christmas presents for children but older people have again been left empty-handed.

"Many pensioners on a low fixed income have felt the strain of inflation-busting council tax increases. We are pleased the chancellor has recognised the problem but increased funding to local authorities may not be the solution.

"What really matters to older people is how this cash will affect the services they receive and the bills they have to pay. The government should consider introducing a fairer system of taxation which takes income rather than property value into account."

"Increases to the basic state pension and pension credit will help some older people but more radical action is needed to solve pensioner poverty.

"The government must turn its back on means-testing and increase the basic state pension to at least £100 per week. Pensioners shouldn't miss the opportunity to share in the prosperity of the nation."

"We are disappointed that the chancellor has failed to bring more women and lower-paid workers into the national insurance system. We want the government to reduce the lower earnings limit and introduce a better system of credits for carers to recognise their valuable unpaid work by enabling them to build-up pension provision."

"Although the New Deal for Skills is welcome; it is vital employers make opportunities available to older workers. It should also look at making opportunities benefit older people who do not receive Jobseekers' Allowance, for example, those on incapacity benefit.

"If the government is serious about increasing the number of older workers we need to see initiatives targeted at this group."

"This new money may not be enough to prevent above-inflation council tax rises in many areas, but it will certainly help. Councils will do their level best next year to keep council tax rises as low as possible."

Forum Response: Help The Aged

Mervyn Kohler, head of public affairs at Help the Aged, said: "The picture painted by the chancellor of a stable and growing economy is not one most pensioners would recognise. They see a world of proliferating means-tested benefits alongside a decline in the real value of the state pension, they face worries about the availability and cost of long-term care, they watch post offices closing and energy prices rising and they read daily of the weaknesses and instability in the pensions and savings sectors. These concerns were blithely ignored in the pre-budget report.

"Help for local authorities to moderate council tax rises is welcome, but the fundamental design of council tax will always hit pensioners on fixed incomes. The chancellor expressly rejected linking pensions to earnings, describing this as a 'prudent and sustainable' course, but this locks in pensioner poverty. The three per cent real rise in annual incomes since 1997 reported by the chancellor has not been matched by state pension increases.

"Child poverty was, rightly, a main focus of the pre-budget report. Pensioner poverty was not even a footnote."

Forum Response: Energy Saving Trust

Philip Sellwood, chief executive of the Energy Saving Trust said: "We are pleased the government is continuing to support cleaner low carbon fuels. The majority of our recommendations have been adopted, particularly in relation to duty on natural gas and the time frames for review. The implementation of a framework will build confidence in the alternative fuels market.

"We welcome the structure and stability the three-year framework offers the marketplace. However we believe the ten-year framework proposed in our response to the consultation would have offered greater industry investment and confidence.

"We eagerly await the final announcement in March on levels of duty for LPG. We will work with the government to ensure that the new rates reflect the environmental benefits that LPG could deliver in the longterm and to support it's role alongside conventional fuels.

"The government has called for a 60 per cent reduction in CO2 emissions by 2050, but the Treasury's statement does nothing to encourage householders to contribute to that commitment. Fiscal incentives, such as a package of inefficiency charges, reduced VAT, stamp duty and tax rebates for installing energy efficiency, would encourage consumers and landlords to take action. Without them we are in danger of causing significant damage to our environment.

"The Energy Saving Trust is encouraged by the government's commitment to further consider fiscal measures for energy efficiency and to include new policies in the Spring Budget."

Forum response: British Property Federation

Reacting to the Chancellor's announcement today that the government would be consulting on the possible introduction of Real Estate Investment Trusts into the UK, Liz Peace, chief executive of the British Property Federation said: "...similar vehicles in the USA and Australia have grown by 918 per cent and 628 per cent over the past decade. Their introduction into the UK would make it easier for institutions and the man in the street to invest in property, providing business occupiers with better property, potentially boosting rented housing supply, and delivering exciting new products for investors.

"The industry, however, has had a few false starts on this issue in the past so we are keeping our feet firmly on the ground. Government seems prepared to consult and listen and at this stage we cannot ask anymore than that.

"A lot of attention has been devoted to what REITS could do for housing, but it would be a mistake to introduce REITS solely focused on only one sector. It would be rather like having a stock market where you could only invest in one sector's shares.

"The PBR statement also refers to draft legislation showing how a model for the taxation of property derivatives might operate seeming, at first reading, to offer a practical and workable solution to issues on which the industry has been making representations for some time."

Reacting to the Barker Review, she said: "Housing has been off policymakers' radars for far too long, and we are therefore pleased to see such a thoughtful analysis of the sector's opportunities and problems."

On the government's pensions simplification paper, she said: "Freeing up SIPPs (Self Invested Personal Pensions) to invest in residential property could attract £5 billion into the housing sector over the next seven years. It will put SIPP investors on a level playing field with other forms of investment and address certain anomalies, which, for example, encourage investors to leave the residential part of mixed-use properties empty so that they do not fall foul of current pension tax rules. Ultimately, it should attract institutions to develop new investment schemes aimed at SIPP investors, bringing more money into housing."

Forum Response: Union Of Shop Distributive and Allied Workers

Sir Bill Connor, General Secretary of Usdaw, said: "The Chancellor has listened to organisations like Usdaw and acted to help parents at work. We very much welcome the increases in tax credits, which are a real lifeline to all low-paid parents. We hope that many employers will take up the opportunity of tax free employer contributions towards childcare costs so that they can make a real difference to many parents struggling with their work/life balance. The government has again shown that they are serious about tackling child poverty and making work pay."

Forum Response: Association of Chartered Certified Accountants

Chas Roy-Chowdhury, ACCA head of taxation, said: "There was very little to cheer in this pre-budget statement. The measures outlined above would have done so much more to improve the business environment and promote enterprise and wealth creation.

"Instead of increasing business confidence, the Chancellor has raised fears that his revived 'spend to save' policy will, in reality, increase the regulatory burden for small businesses."

Forum Response: National Consumer Council

National Consumer Council senior researcher, James King, said: "The chancellor's pride in how little of the public purse Britain plans to spend on pensions compared with other EU countries could be misplaced. Prudent management of the public finances is one thing - but taking pride in the dwindling buying power of the state pension is quite another.

"If the government is to address the current pensions crisis, it needs to restore public confidence in pensions. And that means spending more, not less, to rebuild the whole pensions system with a simpler, more generous state pension at its heart.

"NCC is also concerned that undue attention is being given to the numbers of people likely to be affected by plans for a £1.4m lifetime cap on an individual's pension pot. This is of interest only to the relatively wealthy, who already get more than their fair share of public subsidy to encourage them to save for retirement. Savers on low incomes currently stand to benefit least from the tax incentives on offer. The government's priority should be to introduce simple and fair saving incentives for all."

Forum Response: Constuction Products Association

Allan Wilén, economics director of the CPA said: "Without a clear understanding of how and where the additional funds committed by the government are being spent, it will be hard to ensure or even know whether the extra resources are delivering real improvements to public services and the built environment.

"We welcome Gordon Brown's announcements on the extension of climate change negotiated agreements and the development of the EU Emissions Trading Scheme. However, the Association is disappointed that the Chancellor has failed to develop a number of the other specific measures proposed in its Pre Budget submission to support investment in the built environment, and to improve industry competitiveness."

Forum Response: Association of British Insurers

Peter Vipond, head of financial regulation and taxation at the ABI said: "Today's announcement marks a significant step in providing a level playing field for ISA providers as well as offering ISA savers a greater choice of how to spread investments within their ISAs.

"We have been calling for a simplification of the government's limits on how much can be invested in an insurance-linked ISA, and today's proposal to treat all the Sandler medium-term stakeholder products as 'qualifying investments' for the ISA 'stocks and shares' component is a welcomed move.

"We are encouraged by the government's decision not to implement its plans to abolish qualifying policy rules and tax deferral on withdrawals of up to 5 per cent a year, and this marks a significant win for the customer".

Mary Francis director general at ABI said: "Simplifying the pensions tax regime is essential to encourage more people to save for retirement. We hope the government will keep an open mind about the level of the lifetime cap until it has seen the results of the NAO study. But it is essential that decisions are then taken very quickly if April 2005 is to remain a realistic start date.

"We are pleased that the government has listened to the industry's recommendations by introducing retrospective protection for the people who have already built up large funds; a reduction in the recovery rate where people exceed the lifetime allowance; and the facility to take any funds that exceed the lifetime allowance as a lump sum (once recovery charge has been applied)."

Forum Response: CARE

A spokesman from CARE told epolitix.com: "CARE, along with many low-income families, welcomes the £180 per year increase in the child element of the Child Tax Credit. However, we are concerned that the way the tax credit system operates may mean that many two-parent families will find that they fail to benefit from this extra funding.

"Although the incomes of couples are aggregated for the purpose of determining whether they recieve the credit, they are otherwise treated no differently to single parent families. No regard is paid to the presence and the needs of a second adult.

"In short, the tax credit system can function with a bias against two parent families: children living in these families will be in poverty in circumstances where a corresponding lone parent family would be brought above the poverty level. At last count there were 3.8 million children in poverty on an 'after housing cost' basis - the single largest category (2.42 million) were children living in two parent households.

"The Chancellor must deal with this anomaly if he intends to meet his Public Service Agreement target of reducing by a quarter the number of children living in poverty on a 'before housing cost basis' by the end of 2004."

Forum Response: Local Government Information Unit

Dennis Reed, chief executive of the LGIU, said: "Despite the continuation of the rhetoric about capping, it seems that ministers may be acknowledging that it is no longer tenable to blame local authorities as mainly responsible for excessive council tax increases. This follows recent research by the Audit Commission, and that commissioned by the LGIU, into the causes of council tax rises. These studies demonstrated that the increases were predominantly caused by trends in central government policy.

"The extra money will help many councils around the country avoid council tax increases too far above inflation and cuts in services. Even more importantly, by buying time with this measure ministers must ensure that their Balance of Funding Review comes up with the radical changes that will stop the council tax crisis re-emerging.

"The recent problems will only be overcome once and for all by giving local government a broader tax base, whereby councils raise more than half of their revenue locally. This would take pressure off the council tax and reduce the notorious 'gearing effect'. Meanwhile, the council tax itself needs to be made less regressive by introducing a stronger linkage to income."

Forum Response: Construction Products Association

Michael Ankers chief executive of the CPA said: "This Report makes clear that we are building far too few new homes in this country, and even the lowest estimates in the Report suggest we need to increase supply by, at the very least, 39,000 new dwellings per annum. As Kate Barker stresses, this lack of housing provision is damaging the UK economy.

"The major shortfall lies in the annual provision of affordable housing which has fallen from over 120,000 units 30 years ago, to barely 20,000 units today. We are continuing to press the government to set appropriate targets for the provision of new affordable housing and I hope this Report will now persuade them to do so.

"Inefficiencies in the planning system are clearly a major factor in holding back housing supply. It is far from clear whether the provisions in the Planning and Compulsory Purchase Bill will adequately address the difficulties involved in bringing forward more land for housing. We hope that Kate Barker in her final report identifies additional measures to achieve this.

"The Report identifies the differential VAT rates between new build and repair and maintenance as a key issue to be considered further in the next stage of the Review. We have already submitted an independent report on this issue to the Chancellor and look forward to discussing these important issues further with the Review Team. We believe that cutting VAT to 5% on repair and maintenance would encourage better use of the existing stock and therefore help improve housing supply.

"Finally, the Report identifies the need for the industry to increase its use of technology and adopt alternative manufacturing techniques. Product manufacturers and suppliers have a key role to play in this, and although there have been some encouraging developments as the Report acknowledges, we fully recognise there is scope to do much more."