The government should leave open the possibility of imposing further welfare cuts during the current parliament if it is to tackle the fiscal deficit, Ken Clarke has said.

The former chancellor said that the government had protected too many areas of public spending after the new work and pensions secretary, Stephen Crabb, appeared to indicate that ministers would rule out cuts to the welfare budget for the rest of the parliament.

“We have no further plans to make welfare savings beyond the very substantial savings legislated for by parliament two weeks ago,” Crabb said in a statement to MPs confirming that the government would drop controversial reforms to personal independence payments (PIP). The government clarified the remarks by stressing that there were no plans to fill the £4.4bn gap caused by dropping PIP reforms with further cuts in welfare spending.

Clarke said the government would be wise to give itself room for manoeuvre on welfare cuts after “ringfencing”, or protecting spending, on international aid and the NHS. The former chancellor told the Today programme on BBC Radio 4: “The usual form of words is we have no present plans to make any further cuts in welfare. As a former chancellor I would be startled if you were ruling out ever again reducing any aspect of the welfare benefit. I would advise against that. I think we have ringfenced rather too much. We have ruled out too many taxes from any increase.

“Fortunately George [Osborne] has been brilliantly successful in the last five or six years. Despite all these constraints of modern politics, if I may talk as an old-fashioned chancellor, he has managed to get on top of a financial crisis, produced at the moment the fastest-growing economy in the western world. He’s got a lot of tough decisions over the course of this parliament to keep us on course because the economic outlook isn’t great. We are still running a deficit despite the fact that the economy is growing. You can’t just pile up debt for future generations.”

Clarke defended the PIP reforms. “The reason it was all agreed by the Department [for Work and Pensions] was no one expected this particular bit of PIPs to soar away. They have been paying for extra costs to people who are not incurring extra costs ... When they announced it even the Labour party didn’t create much stir. But then came all the politics of the budget. It actually eases fiscal policy. It has reduced taxes and put off spending cuts, which is very unusual for the first budget after an election.”

In his statement to MPs, Crabb revealed that the government would review the level of its welfare cap in the autumn statement. But he added that “it is right that we monitor welfare spending carefully”, arguing that the principle of having “discipline” through a cap was right.

A beleaguered Osborne is due to appear in parliament on Tuesday to defend his work by taking the unusual step of speaking in the debate following last week’s controversial budget, which caused anger on his own backbenches and culminated in the resignation of Iain Duncan Smith.

The former work and pensions secretary had accused Osborne and David Cameron of protecting wealthy Tory-voting pensioners at the expense of the working poor, while a number of backbench MPs were openly attacking his chancellorship.

Adding to the pressure on Osborne, Boris Johnson, now the frontrunner to become the next Conservative leader, told ITV’s Agenda he believed that the cuts to PIP were a mistake. He added: “I think I have already said very clearly that the government has decided collectively and quite rightly to take the PIP aspect of it [the budget] and try to sort it out.”

Osborne will hit back, and is due to tell MPs: “It is a budget of a compassionate, one-nation Conservative government determined to deliver both social justice and economic security. It’s a budget that puts the next generation first.”

He will also address Duncan Smith directly, claiming that he is sorry he chose to leave government. “[I] want to recognise his achievements in helping to make sure work pays, breaking the old cycles of welfare dependency and ensuring the most vulnerable in our society are protected,” he will say.