Alistair Darling will be forced to issue more than £200bn worth of government bonds this financial year – well above market expectations – as he concedes in Wednesday’s Budget that the public finances have plunged deeply into the red.

With public borrowing set to soar to £170bn-£180bn, the chancellor will have to tap the market for an issuance of gilts that will be well over £50bn higher than the Debt Management Office estimated last month.