Alistair Darling has played down speculation of a big pre-Budget report give away tomorrow, warning that Britain is heading for ‘economic turbulence’ while adding that financial stability would always take precedence over ‘irresponsible promises on tax’.

The newly installed chancellor of the Exchequer has paved the way for a neutral public taxing-and-spending package when he presents his first PBR and the government’s first Comprehensive Spending Review in three years.

He hinted he would cut economic growth forecasts for next year and, possibly, this year, saying: ‘We are entering a time where there may be some economic turbulence. We are entering a difficult period, difficult decisions will need to be taken.’

Speaking on the BBC’s Politics Show, Darling also hinted that there could be changes to inheritance tax thresholds, following Tory promises to increase the tax-free inheritance amount to £1m.