THE Chancellor will today unveil a Budget designed to cut dole queues and create “green” industries, but it will be dominated by the deepening recession and public finances in disarray.

Alistair Darling will announce a £2bn package to guarantee a job or a training place to any young person unemployed for 12 months and pour extra staff into hard-pressed Jobcentre Plus offices.

The Chancellor will also pledge a £500m “green stimulus” for huge wind farms off Britain’s coastline and to create jobs installing fuel-efficient boilers and better home insulation.

And housing developments that have ground to a halt because of the credit crunch will be rescued by a £1bn injection to help the construction industry.

The suspension of stamp duty on properties costing £175,000 or less will also be extended. But Mr Darling’s attempts to present a “Budget for recovery” will be overshadowed by figures confirming Britain is in the deepest recession since the Second World War and that public debt is ballooning.

He is expected to say that the economy will shrink by more than three per cent this year and that Government borrowing will pass £160bn, taking a decade to repay. Debt will peak at more than £1 trillion.

Shadow Chancellor George Osborne has already dubbed the Budget “a day of reckoning” for the Government.

The Budget will coincide with the latest gloomy unemployment statistics, which will reveal the jobless count continuing to soar towards a predicted three million by the year’s end.

And it comes days after metal fabrication company Evenwood Industries, which until recently employed more than 100 people at Evenwood, near West Auckland, County Durham, went into administration.

The growing black hole in the public finances has heaped pressure on Mr Darling to explain how he will raise taxes once the economic recovery begins, hopefully early next year.

However, the Chancellor – who has already pledged £15bn in Whitehall efficiency cuts – is expected to resist Labour backbench pressure to bring forward a 45 per cent tax rate on those earning more than £150,000, due in 2011.

He will also plough ahead with unpopular tax increases on alcohol, which will rise by two per cent above the rate of inflation for the next four years – putting 3p on a pint of beer.

Talks on a £2,000 “scrappage scheme” – to encourage motorists to trade in older cars for newer, greener models – have gone down to the wire, but the measure is expected to be included today.

Mr Darling will also announce extra cash to try to rescue the Government’s flagship pledge to halve child poverty by next year and funds for further education, hit hard by spending cuts and the axing of rebuilding schemes.

Two or three ‘city-regions’ will be handed extra spending power – over transport, job-creation and housebuilding – with the Tees Valley and Tyne and Wear in the running.

Further huge rise in jobless total expected

THE Government was braced for a bout of pre-Budget bad news today, with unemployment figures expected to show another huge increase in the number of people out of work.

Latest jobless figures will be published by the Office for National Statistics, hours before Chancellor Alistair Darling stands up in the House of Commons to outline his financial package.

Analysts have predicted that the number of people claiming jobseeker’s allowance jumped by more than 120,000 last month, following a huge increase of 138,000 in the socalled claimant count in February.

Total unemployment, including those not eligible for benefits, passed two million last month for the first time in 12 years and is expected to continue rising for the rest of the year.

Business groups and unions now expect the wider measure of unemployment to reach at least three million next year because of the effects of the recession.