The chancellor said he wanted to "lock in" stability to the British economy to ensure recent successes were maintained.

He said Britain would remain "vigilant" to global instabilities which could undermine the recovery.

Brown said net borrowing this year would be 3.4 per cent - falling to 2.6 per cent next year and 2.4 per cent in 2005.

Pledging "more balanced economic growth" he said the British economy was set to grow by 2.1 per cent this year - in line with the government's forecast.

And he was bullish about future economic returns - forecasting three to 3.5 per cent per cent growth across the economy for 2004 and 2005.

Brown reminded MPs that this growth had been achieved alongside "low inflation, low interest rates and high employment".

He said inflation had averaged 2.4 per cent, with some 1.7 million jobs created.

Joblessness in the UK was running at just five per cent - significantly lower than competitors such as Japan and the US.

The chancellor predicted that business investment would rise to between 3.3 and 3.5 per cent in 2004.

And he was upbeat about the prospects for manufacturing - predicting a 0.25 per cent increase this year leading into a two per cent growth rate for 2004 and 2005.

The growth in domestic demand, he said, would also remain on an upward trend - set to remain at 2.5 per cent for the next two years.

Debt interest payments were just two per cent of national income over the recent downturn.

He went on to say that "debt levels must be low and sustainable".