Chancellor Gordon Brown today announced a £400 million boost for the Armed Forces engaged in operations in Iraq and Afghanistan.

Delivering his 11th - and almost certainly final Budget - he also promised an extra £86 million for the intelligence and security services in the fight against terrorism.

The measures were coupled with a £36 billion asset sell-off - including the student loan book - and a £26 billion-a-year Whitehall efficiency drive to release money for frontline public services.

Mr Brown also confirmed a boost for British business with a cut in mainstream corporation tax from April 2008 from 30p down to 28p.

The Chancellor said the new rate would be "the lowest of all the major economies".

Mr Brown said that inflation was on track to meet the Government's 2% target over the coming period.

He said that he had met his "golden rule" for the public finances of only borrowing to invest during the economic cycle with a margin of £11 billion to spare.

Mr Brown also laughed off the accusation "Stalinist ruthlessness" by former Cabinet Secretary Lord Turnbull, joking that he welcomed the "forthright advice" he received from civil servants - "or should I say comrades".