London, Jul 9 (IANS): The British government cut its economic growth forecast from 2.5 percent to 2.4 percent this year, as the country's Chancellor of the Exchequer, George Osborne, unveiled the first budget of the new Conservative government on Wednesday.

According to the budget, the Office for Budget Responsibility (OBR) maintained its forecast for Britain's growth in 2016 at 2.3 percent, but enhanced its forecast for the following two years from 2.3 percent to 2.4 percent.

Osborne said the British economy was "fundamentally stronger than it was five years ago", with living standards rising strongly, Xinhua news agency reported.

"A budget that sets out a plan for Britain for the next 5 years to keep moving us from a low wage, high tax, high welfare economy; to the higher wage, lower tax, lower welfare country we intend to create," said Osborne.

According to the budget, the minimum wage will rise to 7.20 pounds (about $11) per hour from next April and rise to 9 pounds an hour by 2020, replacing the 6.50 pounds minimum wage.

Besides, workers aged over 25 would be entitled to a "national living wage" from next April, instead of 21 years old.

John Cridland, the director general of the Confederation of British Industry, said: "Small shops, hospitality firms and care providers are the businesses that will face real challenges in affording the National Living Wage."

"Delivering higher wages can only be done sustainably by boosting productivity. Bringing politics into the Low Pay Commission is a bad idea," Cridland added.