Will a budget delay cause problems for the Tories?

The next budget has something of a curse about it, writes Andrew Grice

A delay may mean Sunak is to bow to pressure to increase spending (Getty)

After Sajid Javid’s resignation, it was striking that Downing Street could not confirm that the Budget would go ahead as planned on 11 March.

The prime minister’s official spokesperson would say only: “Extensive preparations have already been carried out for the Budget and they will continue at pace.”

The statement raised eyebrows at Westminster and in the City. Was Number 10’s refusal to guarantee the Budget would happen on time a hint that Boris Johnson wants Rishi Sunak, the new chancellor, to revisit some of the package being drawn up by Mr Javid? As chief Treasury secretary, Mr Sunak would have known about the Budget preparations, unlike a minister switching from another Whitehall department who would have needed extra time to play themselves in before delivering a Budget.

The prospect of a delay has fuelled speculation that Mr Sunak will bow to pressure from Mr Johnson to announce higher spending, higher borrowing and even higher taxes. Asked whether he would stick to Mr Javid’s fiscal rules, the PM’s spokesperson said: “You know the manifesto the prime minister was elected on.” However, he declined to confirm that the Budget would include Mr Javid’s commitment to balance day-to-day spending on public services by 2023. Mr Johnson and his senior adviser Dominic Cummings may want to review that.

The next Budget has something of a curse about it. Despite moving to the Treasury last July, Mr Javid never delivered one. Philip Hammond moved the annual event from the spring to the autumn. A date of 6 November was announced but the Budget was cancelled amid Mr Johnson’s push for a general election.

Downing Street and the Treasury will be keen to keep any delay to a minimum to show it is business as usual. Probably they will not want Mr Sunak’s debut on the big stage to be delayed beyond the end of March. Mel Stride, the former Treasury minister who is now chair-elect of the Treasury select committee, said: “I would strongly advise it should not be delayed by too much. What has happened telegraphs uncertainty.”

Labour would seize on any significant delay. John McDonnell, the shadow chancellor, is expected this weekend to argue that the chaos inside Johnson’s government shows it unable to deliver a Budget to protect living standards and jobs.

Mr Johnson wants to get unpopular decisions such as tax rises out of the way as early as possible, rather than leave them until closer to the next election. Despite that, Mr Sunak might be tempted to play for time, going ahead with a March Budget but putting off some difficult decisions until his second Budget in the autumn, which will also see a government-wide spending review.