Brexit: ‘Emergency budget’ raises no-deal fears

Kit Malthouse toured television studios. Picture: PA

Kit Malthouse, who has been named policing minister, twice said during media appearances on Thursday that the Chancellor would deliver an emergency budget.

The claim was immediately denied by Whitehall officials and Downing Street, who said no emergency budget was “planned”.

A budget would be needed if the government was to use up £26 billion of ‘fiscal headroom’ and borrow to invest in the economy and stave off a possible recession in the event of a no-deal Brexit.

Mr Malthouse, who served as the Prime Minister’s deputy during Mr Johnson’s time as London Mayor, toured TV studios yesterday to announced plans to recruit 20,000 new police officers in England over the next three years.

Asked how the £1.1bn police pledge would be paid for, Mr Malthouse told Sky News that borrowing would have to increase, adding: “The Prime Minister has also announced there’s going to be an emergency budget in the autumn which will be designed to stimulate the economy.

“What you hope is that a more strongly growing economy will produce greater tax revenue which we can pay for some of the things we want to do.”

A Downing Street source was quoted describing Mr Malthouse’s comments as “speculation”.

And a spokesman for the Treasury responded: “As usual, the Chancellor will announce the timings of any fiscal event.”

Mr Johnson made an estimated £30bn of spending pledges during the Tory leadership campaign.