Rishi Sunak and his Treasury team have been playing down expectations in the run up to tomorrow’s Spring Statement.

The Chancellor has long let it be known that he believes that there should be one annual budget and that the Spring Statement should be more of an update. Like a review with your mortgage advisor.

However, where he expected to be at the helm of an economy bouncing back from Covid, boosted by low unemployment figures and better than expected growth, he finds himself in the midst of a living standards crisis that will hit low to middle earners hard; and a European war which is re-drawing the strategic and economic map of Europe.

The scale of the problem facing the Chancellor is unprecedented for a peacetime government. National Insurance contributions (NICs) are due to go up by 1.25% next month at the same time as energy prices are set to rise by an eyewatering 54% – a combination that electoral strategists in the 90s would call a “double whammy”. Moreover, analysts are warning that interest rates are on course to hit double digits by the end of the year as prices relentlessly climb faster than wages. The tragic situation in Ukraine will likely mean a global shortage of essentials like wheat and sunflower oil, which will again drive up the cost of food and threaten hunger in many parts of the world.

Millions of British families find themselves in a precarious financial situation. With inflation outstripping any increases in wages or benefits, the Prime Minister’s conference theme of a high skilled high wage economy seems a world away. Unsurprisingly, the Opposition is demanding action from Sunak. But they are not alone. Many Conservatives on the backbenches are alive to potential fiscal pain – particularly amongst those in the Red Wall where wages have long lagged behind London and the South East – and who the Tories will need to keep onside if they are to win a fourth election victory. Normally supportive newspapers like the Daily Mail and the Express are also calling for more, which is a sign that middle earners are not happy with the prospect of energy bills reaching £3,000 by the end of the year.

So, what will the Chancellor do? Promises floated in the press that he will reduce fuel duty by 5p and increase the thresholds that NICs apply hardly seem to scratch the surface. He’s reluctant to do more to help with energy bills since the announcement of £200 loans and a council tax rebate in February and he is resisting calls to delay or even cancel the NIC increase, despite increasing pressure to do so.

The strategy of playing down the prospect of help for households is either clever expectations management or is an admirable and principled decision like that of the Captain of the Titanic who opted to go down with the ship after hitting the iceberg.

I suspect it is the former. During the Sunday media round, the Chancellor told the BBC that he couldn’t insulate people from the cold water ahead, “but what I would say is I will stand by them in the same way that I have done in the past couple of years. Where we can make a difference, of course, we will.” The heavy hint is that we might expect help comparable to the actions taken to support businesses and incomes during lockdown.

This notion is compounded by Labour’s messaging around energy prices which is straightforward and easy to understand. They want NIC increases to be postponed, a windfall tax on the profits of energy companies, and the removal of VAT on energy prices. The Chancellor will want to avoid what one of his predecessors liked to call a ‘dividing line’ on energy bills, which will find its way onto millions of leaflets in time for May’s local elections.

The quandary facing the Chancellor is that he must balance the structural and geopolitical hand he has been dealt with the short-term political pressures to find the finance to power a fourth term Government into the next general election. His calculation will be whether the public will forgive him for taking tough decisions now if he can find the funding for tax cuts in 2024.