Philip Hammond rejects calls for Spring Statement spending spree and tells Britain austerity will continue – for now

BRITAIN's defences and NHS won't get any extra money in the Spring Statement, Philip Hammond has said as he rejected calls for a spending spree to boost public services.

The Chancellor said ahead of this week's financial statement that he won't be making any major tax and spend decisions this week.

He slapped down demands from Tories to loosen the purse strings and splash out on public services - as it was reported that the Treasury could enjoy a £11million windfall due to better than expected economic figures.

This was despite raising hopes by writing exclusively in The Sun on Sunday today: “It has been a long road – and there is still work to be done – but I am confident there is light at the end of the tunnel.”

Mr Hammond will reveal the latest raft of economic data to MPs on Tuesday.

Ex-No 10 aide Nick Timothy last week called on the Chancellor to declare an end to the "Age of Austerity" and invest in the long term.

"It can show that the Conservatives are more than just cutters: they have a broader and more ambitious economic mission and a deep sense of social justice," he wrote.

But Mr Hammond vowed today: "We need to get debt down and take a balanced approach to public spending", revealing that debt was still £65,000 per household in Britain.

He told the BBC's Andrew Marr Show: "There is light at the end of the tunnel... but we are still in the tunnel at the moment."

And he said it was "wrong to say that every penny should go into additional public spending" but also said it shouldn't all go towards paying off out debt.

But he raised hopes at major plans to come in November's Budget later this year, adding: "If there is the flexibility, the space to do something, we will decide in the autumn how we are going to use that."

Experts said the Chancellor will soon ditch austerity imposed by his predecessor George Osborne to boost spending on schools and hospitals.

A report by Economists for Free Trade says predicts a surplus of £25billion a year by 2020.

Hopes were raised for an end to the NHS public sector paycap this week when it was reported that a deal was close to offer staff a 6.5 per cent pay rise over the next three years - in exchange for giving up a day's holiday.

The former Defence Secretary also played down fears that our armed forces would face feared cuts.

He said that there were "pressures" on the budget, but that it was the "fastest growing budget in Whitehall".

"We’re committed to making sure that Britain is always properly defended," he added.

New Defence Secretary Gavin Williamson has vowed to fight for every penny to help Britain's boys and girls get the cash they need for vital equipment and training.

However, Shadow Chancellor John McDonnell pleaded with him to change course.

The lefty said that "austerity is holding growth back" and said any change to the public finances was still "not a matter for celebration".