Gordon Brown's budget has been welcomed by both company bosses and unions - though other interest groups have been less than favourable.

CBI director-general Digby Jones gave his backing to Gordon Brown's announcements. "I am pleased that despite electoral temptation, the chancellor has opted for a balanced budget which will not upset the UK's macroeconomic stability or reduce the chance of much-needed cuts in interest rates."

He said: "Measures for business rightly aim to stimulate investment in research and development and encourage continued growth of smaller firms. The abolition of the Minimum Funding Requirement for pension funds is good news. Substantial investment in regional development is also good to see. Tax credits for employers fulfilling training programmes is a project we welcome and will gladly participate in. The changes in VAT for smaller firms are exactly what we've been asking for."

Jones sounded a note of caution. "The fly in the ointment was that the chancellor did nothing to soften the blow of the Climate Change Levy, which is seriously damaging UK competitiveness. And he still refuses to address the level of stamp duty on share transfers, which damages the City of London's standing as the world's financial capital."

TUC general secretary John Monks gave his full support. "This was a good prudent budget for the long term , with children and families very much in mind. The chancellor has cleared the way for the Bank to cut interest rates again tomorrow."

Doug McAvoy, NUT general secretary, said Brown's efforts would do little for his members. "The Chancellor's announcement is acknowledgement at last at the highest levels in the government of the depth of the crisis hitting teacher supply. This is a schizophrenic government denying the existence of the crisis whilst seeking acclaim and votes by offering solutions."The move will not solve the size of the problem which has grown because of Government complacency. Only a limited number of left-profession teachers are likely to return - but in a desperate situation, every little helps. The half million teachers in schools today will ask why so little has been done to encourage them to stay," he said.

Clive Bates, director of ASH accused the government of cynicism. "The freeze in taxes is basically quite shameless but predictable electioneering. They are sacrificing long-term public health policy to short term-electoral calculation. It seems like a give-away budget for smokers, but the real price will be paid in diseased hearts and cancerous lungs."

"When cigarette prices go up, people try to quit or, best of all, never start. Tobacco tax is one of the best health measures and as an alternative to taxing jobs and investment, it is good for the economy. Let's hope the Chancellor goes back to the policy once the election is out of the way," Bates added.

Mervyn Kohler, of Help the Aged, said: "The chancellor's famous prudence has overtaken his concept of fairness. He seems satisfied to peddle his existing special offers to pensioners, rather than to address the structural issues of income and independence in old age. The government's strategy for pensioners is still founded on one-off gifts and means-testing. This will bring some cheer, but is patronising and demeaning at the same time."