Budget 2012: Government borrowing surplus of £7bn should be spent supporting businesses, says PricewaterhouseCoopers Borrowing is likely to come in at £120bn in 2011/12, according to economists at the accountancy firm, lower than the independent Office for Budget Responsibility's (OBR) £127bn projection, which is used by the Treasury as the backdrop for policy decisions. PwC argued that Mr Osborne should use the shortfall to provide support for British businesses, in turn boosting growth. So-called "supply-side" reforms could include lighter regulation, a more competitive tax regime, jobs market intervention and a focus for Government spending on areas such as infrastructure, education and research. Andrew Sentance, a senior economic adviser to PwC and former member of the Bank of England's Monetary Policy Committee, said: "Supply-side policies supported growth in the UK in the 1980s and the 1990s, and we need a stronger focus on them now. That means simplifying and streamlining regulation so we have a good business climate here in the UK - for small companies and new start-ups as well as large multinationals. In the run-up to the Budget on March 21, the Chancellor has been under pressure from businesses to drop the 50pc tax rate on the country's wealthiest individuals, which they say sends the wrong message to entrepreneurs who are looking for a place to do business. Although the Chancellor is not expected to remove the tax rate at a time when excessive pay and bonuses are high on the political agenda, business groups would like him to say when it might be removed. "Businesses and individuals need more reassurance that the tax regime will reward wealth creation over the longer term," said Mr Sentance. Though the Chancellor has limited room for manoeuvre, he can set out more clearly his medium-term plans for getting personal tax rates down. PwC is forecasting UK growth of 0.6pc in 2012 and 1.8pc in 2013, lower than the OBR's November forecasts for 0.7pc this year and 2.1pc next year. The Chancellor has repeatedly emphasised the importance of the Bank of England's role in stimulating demand during the crisis through ultra-loose monetary policy. The MPC is expected to leave interest rates on hold at 0.5pc and the scale of its quantitative easing programme unchanged at £325bn when it announces its monthly decision at noon on Thursday - the third anniversary of the launch of QE in March 2009, the same month that the MPC voted to cut rates to 0.5pc.