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The reduction in public spending will go towards paying for the Defence Investment Plan.
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The chancellor has had to grapple with a mix of public finances and household finances being a mess.
The BBC's Joe Pike explains key things outlined by the Chancellor.
The prime minister said it was his "responsibility" to improve the Brexit deal at a summit in Brussels next month.
The chancellor begins his speech by calling it a Budget for the "working people of Britain, for British businesses big and small."
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