Sajid Javid cancels first major speech as chancellor amid election speculation

‘Panic seems to be setting in inside government’, shadow chancellor claims

Sajid Javid has cancelled his first major speech as chancellor the day before he was due to give it.

The Treasury said the speech had been called off because the “themes and priorities” would instead be laid out in the spending round on 4 September, prompting speculation that an election could be on the horizon.

John McDonnell, Labour’s shadow chancellor, claimed his rival’s decision showed that the government was panicking.

“Sajid Javid is getting a record of announcing events and initiatives, and then within hours cancelling or reversing them,” he said. “This doesn’t inspire confidence. Panic seems to be setting in inside government.”

A Treasury spokesperson said the speech, which was due to take place in Birmingham, was being rescheduled.

“The forthcoming spending round will instead be brought forward in early September and will cover the themes and priorities he was due to outline,” they said.

Mr Javid will make his first round of spending pledges next week – with schools, hospitals and the police all set for a pay boost.

He will give a statement about it to the House of Commons on Wednesday 4 September.

Mr Javid, who came fourth in the Conservative Party leadership contest in the summer, said the government could “afford to spend more on people’s priorities” such as schools, hospitals and police after a decade of cutbacks.

He also promised he would come good on the pledge made by former prime minister Theresa May at the last Tory conference and loosen the purse strings for public services.

The decision to fast-track efforts to draw up public spending and investment plans was announced earlier this month – although the target date was given as just September, rather than “early September”.

Mr Javid asked for a 12-month spending round instead of a longer-term exercise in a bid to “clear the ground ahead of Brexit while delivering on people’s priorities”.

The spending round will cover day-to-day department budgets for 2020-21, rather than a three-year period first mooted by the previous government, as the UK prepares to leave the European Union on 31 October.

Mr Javid said the review would “give Whitehall departments certainty over their budgets for next year, and will confirm our plans to fund the nation’s priorities”.

He added: “The next 65 days will see a relentless focus across Whitehall on preparing to leave the EU. As the prime minister has said, the best outcome for us would be to leave with a deal – he spent much of last week speaking to his European counterparts to do just that. But to get that deal, we need to be prepared to leave with no deal. That’s why after just a few days in the Treasury, I doubled Brexit funding for this year by making an extra £2bn available for no deal preparations.

“That means we can recruit up to 1,000 more Border Force staff, create extra capacity to avoid delays with passport applications, and improve transport infrastructure around ports like Tilbury and Dover.”