This is my tenth and latest Pre-Budget Report and under this Government the tenth consecutive year of growth.

I can report not only the longest period of sustained growth in our history, but of all the major economies — America, France, Germany, Japan — Britain has enjoyed the longest postwar period of continuous growth.

And the Treasury forecast is that growth — sustained under this Government for a record 38 quarters — will continue into its 39th and 40th quarters and beyond.

And this Pre-Budget Report drives forward the great economic mission of our time — to meet the global challenge, to unleash the potential of all British people, so that the British economy outperforms our competitors — and deliver security, prosperity and fairness for all.

Business investment is up 5¾ per cent, exports are up 6 per cent and investment overall is up 6 per cent. Uniquely, Britain continues to combine recession-free growth with the longest period — a decade — of simultaneous employment and productivity growth. In line with independent forecasters, we have decided to maintain trend growth at 2.75 per cent while basing our public finances, audited by the NAO [National Audit Office] as cautious and reasonable, on a rate of 2.5 per cent.

We in Britain now have a long-term choice to make: whether to commit to the essential investments these reports recommend. First, science and innovation. Having consulted on the way forward for university research, we are today detailing a new system for assessment and funding. And, as a first step, universities will have access to £60 million a year directed to applied research with commercial potential.

British science can also do more to eradicate poverty and disease around the world, so the International Development Secretary is establishing a new partnership with the research councils and charities, including the Wellcome Trust and the Gates Foundation, so that we can maximise the contribution of British inventors, scientists and researchers to this urgent global task.

Since 1997 the number of films made in Britain has increased by 50 per cent. To encourage an even more vibrant British film industry, I am today confirming January 1 as the date to introduce new tax reliefs.

To ensure every child and young person has the best start in life, we must also address the causes of child poverty. In April child benefits paid to the poorest child — only £28 in 1997 — will rise to £64 a week. These tax credits are the main vehicle that has ensured that, since 1997, two million children have been taken out of absolute poverty and almost one million out of relative poverty.

I have received powerful representations that in the last months of pregnancy, when nutrition is most important, and in the first weeks after birth, the extra costs borne by parents could be better recognised if we did more to help through our universal benefit, child benefit paid to all.

Help should be available to all mothers expecting a child. So child benefit will be paid on that basis for every mother — additional child benefit that recognises the important role at this critical moment that child benefit can play.

I have said that we should use market mechanisms and incentives to work towards global carbon trading. And we are bringing together the major financial institutions. Our aim: to make London the world’s leading centre for carbon trading. It is time also to set a long-term framework for curbing the carbon emissions from homes — 30 per cent of all emissions. Next week the Secretary for Communities and the Housing Minister will set out plans to ensure that within ten years every new home will be a zero-carbon home, and we will be the first country ever to make this commitment. And to accelerate the building of zero-carbon homes, for a time-limited period the vast majority of new zero-carbon homes will be exempted from stamp duty.

I turn to the framework for transport, responsible for 30 per cent of all carbon emissions, the aviation sector accounting for a fifth of these.

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