Cabinet reshuffle: Next month's Budget in doubt after chancellor's shock resignation

No 10 refuses to say Budget will go ahead as planned - after Sajid Javid’s walkout derailed Boris Johnson's reshuffle

The Budget announced for 11 March is in doubt after the dramatic resignation of the chancellor Sajid Javid, it has emerged.

The prime minister’s spokesman refused to say it would go ahead as planned, saying only: “Extensive preparations have already been carried out for the Budget and they will continue at pace.”

The confusion underlined how much Mr Javid’s sensational walkout – after a bust-up with Dominic Cummings over a demand he sack his advisers – has disrupted the government’s planning.

Rishi Sunak was quickly appointed as the new chancellor, but new spending rules that could leave the government with a £10bn black hole in day-to-day spending are now in question.

Asked whether the PM and chancellor would be held to the fiscal rules set out by Mr Javid, Johnson's spokesman would say only: "You can read the manifesto. I don't have anything to add."

The Conservative manifesto for December's election committed the party to capping public sector net investment at an average of 3 per cent of GDP and to ensuring that state debt will be lower at the end of the Parliament in 2024.

By law, the Budget must be held by 5 April – in the current tax year – and pushing it back until even late March will leave little time to introduce tax changes.

Downing Street sources said that the Treasury would be written by the Chancellor of the Exchequer and Treasury officials in the normal way, but said there will be input from the new economic unit of special advisers shared by No 10 and No 11.

One source said that this was not expected to cause tensions becuase there was "not a cigarette paper" between MrJohnson and his new chancellor on the priority of "levelling up" different regions of the country economically.

Mr Johnson's official spokesman said: “The prime minister has announced the formation of a new Downing Street team based at numbers 10 and 11. It will jointly advise the prime minister and chancellor as they work to level up the economy across the UK.

“The chancellor and prime minister will work together to build this team across the coming weeks.”

The spokesman confirmed that the chancellor will not have a separate set of special advisers at the Treasury.