The chancellor has been banned from using a fleet of RAF jets and helicopters until the Treasury settles a bill with the Ministry of Defence, The Times has learnt, amid a growing spat between two cabinet ministers.

Philip Hammond’s department is said to owe a six-figure sum for past flights with No 32 (The Royal) Squadron. An order has been issued to officials who take VIP bookings for the aircraft not to accept any more requests from the chancellor until he pays up, according to a defence source.

Gavin Williamson, the defence secretary, is preparing to fight the Treasury for as much as £2 billion a year extra for the armed forces to prevent a series of cuts as part of a defence review.

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