High stakes Rachel Reeves is facing a sink or swim moment. Which will it be?

Every budget could be described, to a greater or lesser extent, as a high stakes moment.

- Pippa Crerar and Heather Stewart

Things can easily go badly wrong, as Gordon Brown discovered when he abolished the 10p tax rate in 2007, or in 2012 when George Osborne’s “omnishambles” budget fell apart over pasties, and especially in 2022, when Kwasi Kwarteng’s, disastrous mini-budget sent the Conservatives spiralling towards electoral defeat.

Rachel Reeves already appears to have come perilously close to the turmoil of previous budgets, and that’s before she has even delivered this one. Veterans of the Blair government who have watched the chancellor at work behind the scenes say she has a calm, methodical approach, which compares favourably with the mayhem that surrounded Brown before his budgets, with KitKat wrappers and pages of speech drafts strewn across the floor in No 11.

Yet to the world outside, the run-up to Reeves’s difficult second budget has looked chaotic. A number of policies have been floated, denied, debated and ditched during the buildup to next Wednesday.

Furthermore, a carefully choreographed series of interviews and speeches from Reeves, setting out the bleak economic backdrop and paving the way for a manifesto-busting rise in income tax, gave way last week to yet another policy U-turn.

That highly controversial plan - which would have marked the first rise in the basic rate since 1975 - has been ditched in favour of a menu of smaller revenue-raisers, including extending the freeze on income tax thresholds, which the chancellor said in last year’s budget speech would “hurt working people”.

As investors dumped government bonds on the news that the income tax rise was off - fearing it meant Reeves was less committed to balancing the books - her allies insisted the change of heart was a result of wage growth leading to better-than-expected forecasts from the Office for Budget Responsibility (OBR).