Alistair Darling faces a clear dilemma on Wednesday. When he uses the annual Mais lecture to finally axe Gordon Brown’s rules governing borrowing, the chancellor must prevent the change further undermining confidence in the UK’s economy.

Mr Darling is expected to set out the broad rationale for the change, leaving details of the new borrowing regime for the forthcoming pre-Budget report. The chancellor will argue that the government needs greater freedom to borrow in the short term to cope with the economic downturn.