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For once, PMQs is not the main Commons event.

The atmosphere was a little odd. There were several attempts to get a good old-fashioned partisan row going, but somehow they all seemed a bit ritualistic and fell rather flat, at least until Nick Clegg rose. (The only thing that produces enthusiastic Labour and Conservative unity, is their dislike of the Lib Dems).

A bit of expenses, a bit of energy policy. Some statesmanlike stuff about Afghanistan. Perhaps MPs are a bit apprehensive about the bloodcurdling assessments of the state of the national finances... Mr Speaker Bercow thought MPs were too excitable, but it didn't seem that intense, by recent standards.

The two protagonists for the Pre-Budget Report, Messrs Darling and Osborne both looked suitably grim, and both had chosen suitably sombre attire.

The Chancellor's expected to speak for about 50 minutes. But he can take interventions if he wants - not the usual drill with statements to the House - so the timing is a little uncertain.

12:34 A slightly listless sounding Chancellor declares his task is to ensure recovery. The policy choice is between going for growth or.... not. Flanked by the PM and Harriet Harman, he talks up the prospects for recovery - detecting signs that "global confidence is returning".

12:36 Cutting support for the economy could wreck the economy, the Chancellor warns. This is one of the key dividing lines.... and he confirms VAT will go back up to 17.5% in January, as planned. And he ruled out any further increase.

12:45 More "Hear Hears" from the Labour benches as other tax breaks are extended "as long as needed".

He's postponing a corporation tax increase next year, and extending mortgage support to prop up the housing market. Brief approving murmurs.

Predictions: unemployment will keep rising for some time, but is still lower than France and others. It can never be a price worth paying, he added, rejecting Norman Lamont's famous 1990s comment. He claimed a lower than predicted rate of unemployment as a success for the government's intervention - and he said a short spell of unemployment would not turn into a lifetime on benefits, as in the 1980s, thanks to government interventions to move people off the dole. Another political claim - the government believes in keeping people afloat.

The House is not yet noisy or restive. A few murmurs but no real sound and fury yet.

More State pension will rise by 2.5% - he says a big increase in a time of negative inflation. Also a cut in bingo duty, which brought the loudest reaction yet. Still not very loud. But I think the Opposition can discern an emerging political narrative and maybe electoral strategy.

The recession was sharper than expected, but he still expects a return to growth along the lines of earlier Treasury forecasts. A mention of the underlying strength of the economy brings guffaws.

Future growth will not be driven as much by the financial sector.

Now the public finances...

Revenues from the financial sector, stamp duty and income tax are all down. The banks are requiring £40bn less in support - which helps the figures. But they will have to repay the support they've received. (Emphatic hear hears).

12:55 Now the meat. Public sector borrowing £178bn, not £175bn. It will fall to £82bn in 2014. He's reeling off the figures and percentages to jeers. But no stagey gasps of horror.

British debt will be in line with the average of G7 economies.

Gordon Brown sits impassively as the figures are read.

Mr Darling cites the flexibility of the labour market and low corporation tax rates as reasons the economy will bounce back.

12:56 A growth fund for small business. Extra money for "green jobs". Investments in clean technologies and energy efficiency. Smart meters and a scrappage scheme for old, inefficient boilers.

There's still very little noise. MPs are listening intently. Political antennae are quivering.

13:00 Public sector investment this year reached a 30-year high - Crossrail, rail electrification, motorway improvements will all continue, the Chancellor promises.

What we're not getting is a preview of how the big cut in public debt he's set out will be achieved. Lots of worthy small-scale measures like subsidies for internships - but the big picture on spending cuts and future tax increases is not there.

13:03 Aha! Now we come to the banks.

13:04 He's giving the banks a choice - if they put money into bonuses rather than rebuilding their balance sheets he'll penalise them. Anti-avoidance measures will come in immediately.

Now, pensions tax relief for the highest earners...

And he's freezing inheritance tax thresholds. A bit of politics methinks. A dividing line with the Conservatives.

Crowing from Labour as he moves onto a clampdown on tax avoidance and offshore accounts.

13:13 The majority of reduction in borrowing will come from slower growth in public spending - but it would be dangerous to slam on the brakes, too soon.

Now we come to it. Once recovery is secured we must reduce the growth of spending. The Tories erupt as he claims to be in a position of strength for making economies. The public services are in a better state than for decades, he adds, to incredulous Tory laughter.

But there'll be no full-dress spending review. Instead public spending will grow at 0.8%. There will be an efficiency review and a sell-off of surplus assets. And here's £5bn of savings...

Public sector pension contributions by the state will be capped and the workers involved will pay more to their schemes...

The Speaker intervenes to stop a "running commentary" from the Conservative Henry Bellingham.

13:17 Funds for operations in Afghanistan and for overseas aid are announced. The NHS, the police and schools will have their budgets protected...partly paid for by a half-penny increase in National Insurance, configured so that no-one earning under £20,000 will lose out.

You can almost hear brains whirring as the political ramifications are calculated.

Now the big finish - an extension of free school meals.

His peroration: he's been supporting families, other countries have copied his policies, but not the Tories. And the choice is between securing the recovery or wrecking it. Between Ambition or Austerity

13:19 Now Osborne.

The bill of indictment. A new tax on jobs. A long-term burden for families. "Never trust a Labour government with your money."

The government front bench talk amongst themselves with studied nonchalence. Alistair Darling shuffles his papers.

13:21 The Chancellor failed on all fronts, says his shadow. His forecasts were wrong.

A nice point. Mr Osborne said the Chancellor gave the annual figure for the shrinkage of the economy in Britain and compared that to the figures for total contraction in other countries.

Some scorn about the newly-published Fiscal Responsibility Bill. "Instruments of the fiscally irresponsible."

The test of the windfall tax on bankers' bonuses will be whether it curbs bonuses or bank lending, he says, with shadow chief secretary to the Treasury Phillip Hammond nodding sagely.

Lots of good one-lines he'd made earlier, including: "The previously impossible trick of ring-fencing a black hole." Tee hee.

13:28 A key sound bite: the message of the PBR to aspirational families is that the Labour party is no longer for them.

Labour jeers as he says the Chancellor should have borrowed his catchphrase, that "we're all in this together".

Britain is on the brink of bankruptcy, he says.

And a good payoff - most bailouts start with the people at the top.

Alistair Darling rises. His response is to accuse Mr Osborne of avoiding the issue of returning Britain to growth.

The Speaker ticks off Tory backbencher Crispin Blunt. Vehemently!

The Chancellor quotes David Cameron appearing to take both sides of the "cut now or later" argument - which Gordon Brown beside him seems to rather enjoy... a brief instant of animation before lapsing back into impassivity.

Now it's Vincent Cable's turn.... An acid start, complaining that 43 paragraphs of the statement were missing from the version given to opposition parties.

13:36 Vince says what was needed was a plan for recovery, what was delivered was an election manifesto. "A good budget for bingo and boilers."

And the one-liners keep on coming. "The economy is being re-built on sand." A swipe at the "extraordinarily arrogant and stupid behaviour of the RBS board" who'd threatened to resign over curbs on bankers' bonuses.

The other parties normally make for the doors when it's the Lib Dems' turn. But Vince is box office. A sage, even. So a fair few stay to listen to his latest jeremiad. Beside him, Nick Clegg contributes the odd segmented "absol-utely". He says the government's growth projections seem optimistic - what if the economy slumps into a "double-dip" recession. And the spending cuts hit low paid workers...

Gordon Brown hasn't stayed. From the Labour front bench, Chief Whip Nick Brown has fixed Vince Cable with a baleful glare.

13:43 Pleased Lib Dem cheers as Vince sits down, having described the bankers' bonus proposals as a "gift wrapped invitation to tax avoidance". And he complains that the lower-paid will be hit by the package.

13:44 The Chancellor retorts that a failure to say what they would do is one of the advantages of sitting on the Lib Dem benches. He's very unruffled and sticks to the line, with the ghost of a smile occasionally playing on his face. Dr Cable questioned what would happen in bankers bonuses were paid as income, rather than bonuses. They would attract Income Tax, the Chancellor said. (Titters).

13:47 The Speaker notes 22 MPs want to comment.

Edward Leigh, chairman of the Public Accounts Committee, says previous efficiency savings were identified by independent audit and challenging the Chancellor to let the National Audit Office, the public spending watchdog, audit his PBR assumptions. Batted away.

13:50 Labour left-winger Michael Meacher wants a tougher line on the banks. A one-off windfall tax was not enough. The Chancellor disagrees.

13:53 Sheffield's Richard Caborn talks about market short-termism and calls for long term investment. There's been much harking back to folk memory of the 1980s recession, and the Chancellor nods appreciatively.

Frank Field likes the Budget! And the Chancellor. Well a bit, anyway. The Labour maverick - so often a critic of the PM - is worried about the impact on long term interest rates of his announcements on public spending: will the markets demand a higher interest rate to lend to Britain, if they don't think his plans are credible?

13:57 Devolution time. The DUP's Sammy Wilson asks for reassurances that funding for Northern Ireland will not be cut.

A little later the SNP's Stewart Hosie warns of cuts in funding to Scotland, particularly in capital funding. It would weaken the recovery in Scotland.

Mr Darling accuses the SNP of damaging Scotland by dropping Labour's PFI approach - result, he says, no new schools, other than those started before Labour lost office in Edinburgh.

A reminder that the government is fighting political battles on more than one front.

Jeremy Corbyn, lurid in a purple shirt, complained about the effects of housing benefit withdrawal rates on unemployed people who find a job. Mr Darling promises a statement.

More will follow but I'm signing off at this point. Comments gratefully received.

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