Austerity will continue for five more years if Britain crashes out of the EU with no deal, Philip Hammond signalled, in a Budget warning to MPs threatening to vote down Theresa May’s Brexit plans.

The chancellor unveiled a Budget giveaway that cut income tax, announced a tax on the tech giants and conceded to pressure to help the victims of the bungled universal credit shake-up.

But, most significantly, Mr Hammond made clear the prime minister’s promise that “austerity will be over” would only be met in full if Britain sidesteps economic damage from Brexit and the growing risk of leaving the EU with no agreement next March.

Spending would rise by 1.2 per cent per year from next year, he announced – but immediately acknowledged the £20bn for the NHS would gobble up all the extra cash.

All other departments would only “keep pace with inflation”, a Treasury source said, before adding, tantalisingly: “If there’s a good deal, there’s an increase”.

It appeared to be a clear warning to MPs that plunging Britain into the chaos and damage of a no-deal Brexit would prolong the pain of austerity for years to come.

Some key departments – covering spending on the police, the courts and benefits – are still heading for cuts in day-to-day spending until 2022, the Budget book showed.

Labour seized on the Budget and plans for next year’s spending review as proof that “the pledge to end austerity was a broken promise”.

“It is now clear austerity is not over, the cuts to social security will continue and Philip Hammond gave no assurances that departments won’t face further cuts,” said John McDonnell, the shadow chancellor.

The respected Resolution Foundation think tank, said: “The chancellor has significantly eased – but not ended – austerity for public services. However, tough times are far from over.”

It warned that, after other spending protections for defence and foreign aid, the plan “probably means more cuts for other departments”.

And the Child Poverty Action Group seized on the failure to end the four-year freeze on family benefits – cuts in real terms – as proof there was no “substance to the claim that austerity is over”.

Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Show all 14 1 /14 Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Internal divisions in the Conservative Party have exploded into a bitter public row over Boris Johnson‘s “disgusting” criticism of Theresa May. Some senior Tories furiously denounced the former foreign secretary after he accused the prime minister of having ”wrapped a suicide vest” around Britain Reuters Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Sajid Javid, Home secretary Sajid Javid, the home secretary, rebuked his former cabinet colleague and said: “I think there are much better ways to articulate your differences.” He told the BBC’s Andrew Marr Show that the public wanted politicians to use “measured language” BBC/PA Boris Johnson 'suicide vest' Brexit jibe causes Tory divide But other MPs leapt to Mr Johnson’s defence, as dividing lines ahead of a possible leadership contest begin to take shape. The Uxbridge MP has repeatedly criticised Ms May’s Chequers plan and used a newspaper article on Sunday to suggest it amounted to “wrapping a suicide vest around the British constitution”. His latest salvo at the prime minister prompted immediate condemnation, with one minister publicly vowing to end Mr Johnson’s career over the matter PA Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Alan Duncan, Foreign minister Alan Duncan, a foreign minister who worked in Mr Johnson’s team for two years, wrote on Twitter: “For Boris to say the PM’s view is like that of a suicide bomber is too much. This marks one of the most disgusting moments in modern British politics. “I’m sorry, but this is the political end of Boris Johnson. If it isn’t now, I will make sure it is later.” Getty Boris Johnson 'suicide vest' Brexit jibe causes Tory divide James Brokenshire, Housing secretary Housing secretary James Brokenshire added his voice to the criticism, calling Mr Johnson’s comments ”wrong” He said: “I think he is wrong on this...I think the tone that he has used isn’t right and I think that we just need to be very focused on actually moving forward with the Chequers plan.” AFP/Getty Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Zac Goldsmith But as Tory hostilities spilled over into open public warfare, Richmond Park MP Zac Goldsmith, an ally of Mr Johnson, hit back at Mr Duncan. He wrote: “There are a number of possible motives behind this tweet, but given its author, we can be certain ‘principles’ aren’t one of them.” Getty Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Jacob Rees-Mogg Senior Tory Brexiteer Jacob Rees-Mogg told The Independent he thought Mr Johnson’s “suicide belt” accusation was little more than “a characteristically colourful catchphrase”. He added: “I agree with the sentiment. The criticism of Boris’s wording merely serves to highlight his point. It means more people hear of Boris’s criticism of Chequers and many will agree with him.” Reuters Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Nadine Dorries Nadine Dorries, another Brexit supporter, said Mr Johnson’s opponents were “terrified of his popular appeal”, adding: “Don’t underestimate the vitriol that’ll be directed towards Boris today. He delivered the Leave vote, Remainers and wannabe future PMs hate him.” If Mr Johnson became leader and prime minister he would deliver a “clean and prosperous” Brexit, she said Rex Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Andrew Bridgen Andrew Bridgen said Ms May was to blame for her leadership problems. Asked if Mr Johnson had put a bomb under her leadership, Mr Bridgen said: “I think that Theresa May did that herself when she put forward the Chequers proposals without consulting widely prior to that.” Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Steve Baker, former Brexit minister Steve Baker, the former Brexit minister, warned Ms May the Conservatives faced a "catastrophic split" if she did not jettison her Chequers plan. Mr Baker, who quit the government in July over the scheme, said: “When negotiating, the prime minister needs to demonstrate her intent and also her power to deliver. "If we come out of conference with her hoping to get Chequers through on the back of Labour votes, I think the EU negotiators would probably understand that if that were done, the Tory party would suffer the catastrophic split which thus far we have managed to avoid.” But he insisted he did not want a change in the Conservative leadership, saying Brexiteers did “not want to be in a position of conflict with our own prime minister” Reuters Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Tom Tugendhat The deep divisions on the Tory benches were laid bare as Tom Tugendhat, who chairs the Commons foreign affairs committee and is a possible leadership rival to Mr Johnson, also hit out at the former foreign secretary. Recalling how he encountered a suicide bomber in Afghanistan during his time in the army, Mr Tugendhat told Mr Johnson to “grow up”. He said: “A suicide bomber murdered many in the courtyard of my office in Helmand. The carnage was disgusting, limbs and flesh hanging from trees and bushes. Brave men who stopped him killing me and others died in horrific pain. “Some need to grow up. Comparing the PM to that isn’t happy.” PA Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Alistair Burt Alistair Burt, another Foreign Office minister who worked in Mr Johnson’s team, said: “I’m stunned at the nature of this attack. There is no justification for such an outrageous, inappropriate and hurtful analogy. “If we don’t stop his extraordinary use of language over Brexit, our country might never heal. Again, I say, enough.” AFP/Getty Boris Johnson 'suicide vest' Brexit jibe causes Tory divide It comes amid that Ms May’s former aides drew up a dossier on Mr Johnson’s sexual encounters with the aim of undermining his leadership prospects. The document was compiled in 2016, when the Uxbridge and South Ruislip MP was seen as the main rival to Ms May in her bid to enter No 10. Downing Street and Conservative Campaign Headquaters (CCHQ) both denied having leaked the 4,000 word memo after it was circulated around Westminster AFP/Getty Boris Johnson 'suicide vest' Brexit jibe causes Tory divide Mr Johnson confirmed that his 25-year marriage to wife Marina had ended AP

The criticism came after a Budget dominated by the spectre of Brexit which, Mr Hammond has acknowledged, could wreck his government’s economic plans.

He was able to announce – and spend – an £11.6bn windfall from rising employment, higher tax revenues and lower debt interest payments, mostly on the NHS, which will receive an extra £7.9bn in 2019-20 alone.

There was good news for workers, with hikes in the income tax-free allowance – to £12,500 for the 20p rate and £50,000 for the 40p rate – brought forward a year to next April.

The minimum wage will increase by 4.9 per cent next April, to £8.21 an hour, there was £160m for counterterrorism police and £400m for schools to buy “little extras”, a description that sparked fury from hard-pressed teachers.

And a digital services tax will raise £400m a year from the likes of Amazon and Facebook from April 2020, after Mr Hammond accused other countries on dragging their heels on international action.

But, strikingly, Mr Hammond refused to echo Ms May’s pledge that austerity would soon be “over’, instead telling MPs it was “coming to an end”.

And he confirmed he was considering another emergency Budget next year, if the Brexit talks fail, by “upgrading” what would otherwise be a low-key spring statement.

The chancellor has not confirmed even a 1.9 per cent spending rise, which remains a “forecast” dependent on the Brexit outcome.

Meanwhile, the independent Office for Budget Responsibility (OBR), was withering about the risk from failing to achieve a smooth Brexit, an event without “precedent”.

“A disorderly one could have severe short-term implications for the economy, the exchange rate, asset prices and the public finances,” its Budget report said.

In his speech, Mr Hammond pointed to the “pivotal moment in our EU negotiations” as he set out a “five-year path for departmental resource spending”.

And he pointed to the prize of spending £15.4bn of funds set aside to guard against a bad Brexit, plus “a boost from the end of uncertainty”.

“Get it right, and we will not only protect Britain’s jobs, businesses and prosperity but we will also harvest a double-deal dividend,” he argued.

Overall, he announced £103bn of extra spending planned for the next five years, increasing the deficit by £10.9bn next year – despite a stated policy of eliminating it.

The OBR said the chancellor had abandoned his plan to achieve a balanced budget by the middle of the next decade, largely to address the NHS’s funding crisis.