Budget 2016: George Osborne's surplus pledge puts him an bind

Six days to go until his toughest Budget since the “omnishambles” affair of 2012, and the Chancellor is desperate for cash. Listen closer and you may hear the sounds of pockets being patted in the Treasury for every last copper.

It’s not a propitious backdrop for a man who aspires to be Prime Minister. George Osborne may have been master of all he surveyed a few months back but the economy is weaker, borrowing is inching down rather than tumbling and near-zero inflation is crimping his tax revenues.

His Budget red box is full of bad news but his blond rival for the Tory crown gets to crusade for the “outers” in the referendum race, leaping ahead of him as favourite to succeed David Cameron.

The Chancellor is between a rock and a hard place. He’s backed away for now from an overhaul of the pension system that would have given him politically expedient future tax revenues up front and virtually assured he hit his surplus target; but as a result, it might not be a good Budget for drivers.

Commitments not to put up VAT, National Insurance contributions or income tax leave him running out of road in terms of the revenues he needs. Plans to raise the threshold of the 40% tax rate to £50,000 by 2020 need to be paid for. Hence the anonymous ministers who’ve been briefing that drivers “wouldn’t even notice” a 2p hike in the cost of fuel duty in the Budget following recent falls in petrol prices.

I suspect they will, and that gratitude for the five-year freeze since 2011 will be in short supply, especially as oil is ticking higher again.

The Chancellor may gulp at the prospect of picking a fight with Middle England but the trouble is that only fuel duty will do the job of boosting revenues by the sums he needs.

The Treasury’s ready reckoner suggests a 2p duty rise — around 3.5% on the current 57.95p a litre — will bring in a total of £2.7 billion extra over the next three years. But crunching the numbers highlights the fact the middle fifth of workers pay out the biggest share of their disposable income on petrol — around 4.4% compared with 2.7% for the top fifth — so it will be politically unpopular.

Will he have the nerve to do it next week, stirring anti-Government animus ahead of the crucial vote? Or does he maintain an ominous silence while readying the stick for the Autumn Statement when the referendum and a likely Yes result are safely in the rear-view mirror?

At this point, the Chancellor may be regretting the pledge to run an absolute surplus in the public finances by 2019-20 rather than his previous rolling five-year plan, which gave him more wriggle room. But he’s already dropped a hint on more cuts, from the safe distance of 6000 miles away, at last month’s G20 summit in Shanghai.