LONDON (AFP) Finance minister George Osborne unveiled plans to kick-start Britains faltering economy in his annual budget Wednesday but admitted that growth would be far lower than expected this year. Chancellor of the Exchequer Osborne, a member of the Conservative-led coalition, said his 2011-12 tax and spend plans were aimed at promoting growth and jobs for Britain after he last year unveiled huge spending cuts. Ignoring widespread calls to reduce the size of the cutsthe deepest for decadesOsborne told parliament: Britain has a plan and were sticking to it. In a boost for Britons, he announced surprise cuts to business and fuel levies, while lifting the threshold at which workers start to pay tax and announcing financial assistance for people struggling to buy their first home. Yet alongside the help, there will be 21 billion (24 billion euros, $34 billion) of government spending cuts in 2011-12, around a quarter of the savings lined up by the Conservative-Liberal Democrat coalition through to 2015. Following Britains 2010 general election, Osborne gave a painful emergency budget and spending review in which he announced plans to save 81 billion over five years in order to slash a record public deficit. Last years emergency budget was about rescuing the nations finances, and paying for the mistakes of the past, Osborne said Wednesday. Todays budget is about reforming the nations economy, so that we have enduring growth and jobs in the future. And its about doing what we can to help families with the cost of living and the high oil price. The path to recovery is expected to be far from smooth, however, after Osborne lowered the governments official forecast for 2011 gross domestic product (GDP) growth to 1.7 percent from an earlier prediction of 2.1 percent. He said the major downgrade, which was in line with market expectations, came after the economy surprisingly shrank in the final quarter of 2010 and was also due to rising commodity prices and inflation. The 2012 growth estimate was also trimmed, to 2.5 percent from 2.6 percent previously. Further ahead, the economy is predicted to pick up speed, expanding by 2.9 percent in 2013. The leader of the opposition Labour party, Ed Miliband, seized on the growth downgrades, telling the House of Commons: Growth down, last year, this year and next year. Every time he comes to this House, growth is downgraded. Osborne also cut public sector net borrowing for the current fiscal year, which runs to the end of March, to 146 billion from 148.5 billion previously. In a boost to the private sector, he cut corporation tax paid by businesses by two percentage points to 23 percent after earlier announcing that he planned a reduction of only one point. However in a blow to Britons ahead of the budget, Osborne in January hiked the rate of Britains sales tax, or VAT, to 20 percent from 17.5 percent. Last month, he also announced that a special levy on banksimposed following the 2008 global financial crisiswould be raised to yield 2.5 billion this year. The chancellor is meanwhile on course to undershoot his official borrowing target for the current 2010-11 financial year despite figures Tuesday showing that public sector net borrowing surprisingly hit a much larger-than-expected 11.8 billion in Februarythe highest level on record for the month. The coalition is seeking to slash a record public deficit run up under the previous Labour government due to bank bailouts and weak tax revenues in the recession. In a further blow ahead of the budget, separate data Tuesday showed annual inflation jumped to 4.4 percent in February, the highest level since October 2008.