Sajid Javid has cancelled plans to hold his first Budget as chancellor next month as government sources said ministers would essentially go on strike if parliament did not vote for a general election next week
A Treasury source said the economic set piece would be put off after the prime minister effectively admitted the UK would not be leaving the EU on October 31.
The move comes after prime minister Boris Johnson announced he wants an election on 12 December, and would put forward a motion on the plan on Monday. Government sources said the ministers would essentially go on strike if the election bid was rejected, but Labour Party sources indicated its MPs would not vote for the poll.
It comes after Johnson appeared to accept the Article 50 deadline will be extended from the end of this month to January 2020 after he failed to get his Brexit deal passed through parliament.
The programme motion for his Withdrawal Agreement Bill was defeated in the Commons on Tuesday night, meaning the legislation would not have the time to pass into law in time for an October 31 Brexit.
Javid had previously announced he was set to hold a Budget after the UK exited on Halloween under the terms of the WAB.
Speaking to ITV's Peston programme on Wednesday he insisted it would go ahead, saying: “There will be a Budget. The Budget is on track."
"When I announced the date, November 6, I said the only situation where there won't be a Budget would be if there was a no-deal outcome – now we can't rule that out at this point, but we're on track to have a Budget," Javid insisted.
Less than 24 hours later, Johnson held an emergency cabinet meeting before announcing that the way out of the current political impasse was to give parliament more time to scrutinise the legislation, but to also agree to an election on December 12, and the Budget plan was shelved.
A Treasury source said: "Parliament has voted for a delay. We're calling for an election, so we won't be delivering the Budget on November 6."
A spokesman for Johnson said the government would only bring "the bare minimum" in front of parliament if he is thwarted in his plan to go to the country on December 12.
Johnson said that a snap poll was the only solution to break the Brexit impasse.
He said: "The way to get his done is to be reasonable with parliament and say if they genuinely want more time to study this excellent deal they can have it, but they have to agree to a general election on December 12."
It will be the third time Johnson has tried to call an election, having failed to get the necessary two-thirds – 434 votes – majority required by the Fixed-Term Parliaments Act on two previous occasions in the three months since he became prime minister.
In a letter to Jeremy Corbyn setting out his plans, he said: "It is time, frankly, the opposition summoned up the nerve to face our collective boss, which is the UK."
Corbyn has postponed a final decision on wheher to back Johnson's election call until the EU announces what length of Brexit extension it will offer the UK, a decision that may not come until Monday.
The civil service’s largest union slammed the briefings coming out of Downing Street. A Public and Commercial Services union spokesperson said the government introduced new strike thresholds for public services in 2016, requiring a turnout of at least 50% for ballots to be valid, and an additional hurdle for frontline services of at least 40% support of all those entitled to vote. A PCS ballot for civil service strike action earlier this year found overwhelming support for strike action (78.9%) but was just short of the 50% threshold, at 47.7%
The spokesperson said: "It is the height of hypocrisy for a government who have introduced some of the most draconian laws to prevent workers taking strike action, to now be threatening a 'strike' themselves."
Garry Graham, deputy general secretary of the Prospect union, agreed.
“The government's suggestion that they will go on 'strike' will look petulant to civil servants and reinforce the feeling amongst many that they are the grownups in the room when it comes to the effective functioning of government at the moment,” he said.
“Civil servants will also rightly question the legality of someone “going on strike” with no ballot, no grievance and no loss of pay. Ministers should consider their duties and responsibilities not pantomime politics.”