PHILIP Hammond has taken a "gamble" with the public finances, which could lead to higher borrowing and debt in coming years, a respected economic think-tank has claimed.

The Institute for Fiscal Studies, in its traditional post-Budget analysis, said the Chancellor might have "painted himself into a corner" by using a windfall from revised borrowing forecasts to fund increased spending on the NHS.

And it warned that tax rises were "all but inevitable" in the longer run to pay for the pressure on the NHS of Britain's ageing population.

Any expectation that Mr Hammond would now meet his target of eliminating the deficit by the mid-2020s was "for the birds", said Paul Johnson, the IFS Director.

Despite the Chancellor’s claims that the economy had "turned a corner" on the way to the end of austerity, Mr Johnson said Monday's Budget was "no bonanza" for public services other than the NHS.

While the health service in England was set to enjoy £20.5 billion higher spending by 2023/24, spending on most other departments would be "essentially flat" over the coming five years once inflation was taken into account, explained Mr Johnson.

On a narrow definition, Mr Hammond's package could be seen as an end to austerity, he accepted, but added: "On wider definitions, it doesn't, at least not yet."

Looking at the impact of the package on the public sector, the think-tank chief said: "This is no bonanza. Many public services are going to feel squeezed for some time to come. Cuts are not about to be reversed.

"If I were a prison governor, a local authority chief executive or a headteacher, I would struggle to find much to celebrate. I would be preparing for more difficult years ahead."

Mr Johnson said the rise in income tax thresholds announced by Mr Hammond would benefit the wealthy more than those less well-off, with a typical higher rate taxpayer gaining £176 a year and a basic rate payer gaining just £24.

And he said that, even after the injection of around £2 billion a year into Universal Credit, there would be "millions of losers" from the introduction of the new benefit.

The Chancellor's move to reverse previous cuts to UC was "a small increase in generosity compared to the cuts to working age benefits introduced since 2015 and small relative to cuts still to come," added Mr Johnson.