ALEX BRUMMER: Is Chancellor nearing her final hurrah?

The fates of Chancellors of the Exchequer are usually decided by epoch-making events. There was Denis Healey’s retreat to Downing Street from Heathrow as the pound collapsed in 1976.

Then Norman Lamont’s misfortune in presiding over the exit from the exchange rate mechanism in 1992. And Kwasi Kwarteng’s car crash mini- Budget in 2022.

Fortunately for Rachel Reeves, there has been no such defining event since she took over as Chancellor last July, although the run-up in bond rates to levels not seen since Kwarteng and Liz Truss were at the helm has not inspired confidence.

The promise of bringing stability to the public finances has proved a chimera, with public sector borrowing hitting a whopping £132.2billion in the first 11 months of the current fiscal year, £14.7billion more than at this time in 2023-24. That is £20.4billion above Office of Budget Responsibility levels and explains why Reeves is desperately hunting urgent public spending cuts.

Wednesday’s Spring financial statement can only layer on the agony for spending departments, with the axe poised over public services Labour promised to repair.

We may be spared tax rises, but with £40billion in the pipeline, including the dreaded employers’ National Insurance contribution jump, enough pain has been delivered. Reeves’s misconceived stewardship of the Treasury has seen £9.4billion spent on buying union peace – a short-term fix – and £24billion headed down the black hole of the NHS.

Feeling the strain: Rachel Reeves is safe for the moment because she can hide behind the mask of geopolitics

None of this has eased public dissonance. Latest data from the Office for National Statistics shows that 87 per cent of the public remain worried about the NHS, 86 per cent about the cost of living (higher utility bills are dropping into letter-boxes right now), followed by the economy at 70 per cent.

Inflation is higher, the brakes have been slammed on growth – because of a loss of business confidence – and the vow of only one major financial statement a year has become risible.

Reeves has swung from blaming the Tories to making vacuous announcements about a new runway at Heathrow, which could take decades to deliver.

She has managed to turn a routine fiscal update this spring into a political circus. Blaming it on global events – read Donald Trump – doesn’t cut it. The verdict of the bond markets, where hedge funds are taking enormous bets against the UK, will determine Reeves’s future.

Labour chancellors are notorious for delivering hard times. Healey was ordered by the IMF to deliver savage budget cuts; Roy Jenkins was uniquely sober in his stewardship, and it was the late Alistair Darling who began the march to austerity always blamed on George Osborne after the financial crisis of 2007-08.

Reeves is safe for the moment because she can hide behind the mask of geopolitics with the ratchet in defence spending providing a shield.

Business gave up on her months ago. Financial leaders privately mock her concocted CV.

Unless Reeves can deliver convincing spending reductions, showing the fiscal rules she so confidently rewrote are sacrosanct, her image as ‘Iron Chancellor’ will rust over rapidly.

Limping on, in a low- or no-growth world of deteriorating public services, will not be an option.