The chancellor said that the NHS settlement had used up any available extra funds

Philip Hammond has warned the cabinet that he has no more money for other policies after being forced to find £25 billion for the NHS.

The chancellor used a presentation to senior ministers before Theresa May’s speech on the health service yesterday to rule out extra spending on areas including schools, defence, prisons and police.

He also made clear that, having fulfilled the Vote Leave pledge of paying for the NHS rise from a “Brexit dividend”, the government would need to find money to replace other funding provided at present by Brussels.

One cabinet minister said that there was shock at what this meant: “The atmosphere was quite muted. Ministers could see the implications are going to make life quite difficult. Any sense that