Sajid Javid has been forced to abandon an official Treasury analysis of Labour’s policies amid claims the move is an abuse of his power over the civil service.
The chancellor had ordered department officials to scrutinise his opponents’ plans for the economy in the final days before parliament dissolves, reports over the weekend suggested.
But an email, seen by HuffPost UK, confirms that the Treasury will not publish such an analysis ahead of the December 12 snap general election.
Labour has not yet published its manifesto but it is thought the nationalisation of rail companies, Royal Mail, water and energy utilities will be included.
It is thought cabinet secretary Mark Sedwill intervened to stop Javid after Shadow Chancellor John McDonnell contacted the top civil servant to claim the use of Whitehall resources was electioneering and an “abuse of power”.
A Labour source told HuffPost UK: “This is an embarrassing slap in the face for Tory ministers, who have been caught red-handed attempting to blatantly use the civil service for party political purposes in an unprecedented way.”
Speaking to the Independent on Tuesday, McDonnell said: “It’s an abuse of power.
“I’ve spoken with the civil service this morning. We weren’t sure it was happening, but we got confirmation from the permanent secretary.”
He continued: “The Treasury civil servant phoned me up this morning to confirm that that was happening today. What he said is they’ve looked at a range of our policy statements.
“I said first of all, one you do not know what is in the manifesto so that is pure speculation. Secondly, this being done within hours of the formal campaign being undertaken. Thirdly, I think it’s an abuse of power.
“I suggested he goes back to the Cabinet Office and advises them it is completely contrary to everything we expect from the civil service in this country. I’m happy for anyone to examine our policies, but to do this hours before a general election campaign is I think an abuse of power. Unacceptable.”
It was claimed that ministers ordered the civil service to draw up calculations for the analysis after Labour clashed with the Confederation of British Industry (CBI) over the cost of its policies.
The business lobbying groups said Jeremy Corbyn’s renationalisation programme will cost £196bn up front.
But Labour described the research as “incoherent scaremongering” that does not take into account the revenue that the newly nationalised industries would generate for the government.
The party has also maintained that renationalisation would be cost neutral in accounting terms as the government would exchange liabilities in the form of bonds for ownership of companies.
However, the CBI claimed the up front cost would be close to the combined total of the £141bn health budget, and the £61bn spent on education.
It also claimed there could be a 10.7% increase in debt from bringing industries into public ownership.