Mr Hammond also a pre-Budget gaffe as he said “there are no unemployed people”.

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Philip Hammond has signalled the UK will make an improved offer to the European Union on the Brexit divorce bill before a crunch summit in December.

The Chancellor conceded time is running out to break the deadlock over the UK’s withdrawal from the bloc as he reiterated Theresa May’s repeated insistence that Britain will meet its obligations to the EU.

Meanwhile, Mr Hammond put himself on a collision course with the head of the NHS as he downplayed a warning from Simon Stevens that the health service needed an extra £4billion of funding to avoid the prospect of waiting time limits being scrapped.

The Chancellor delivered a slap down to Sajid Javid, the Communities Secretary who has called for the Government to borrow billions to fund house building, as he said there was not a “single magic bullet” to resolving the crisis and that “it is certainly not just about pouring money in”.

Mr Hammond also made a pre-Budget gaffe as he said “there are no unemployed people”.

Mrs May has been urged to increase her offer on the divorce settlement beyond the €20 billion (£17.85 billion) which she set out in her Florence speech in September.

Theresa May
Theresa May, the Prime Minister Credit: Toby Melville /Reuters

The EU has stressed that more progress is needed on the issue before it will sign off on talks progressing onto future trading arrangements.

Mr Hammond suggested the Government will make an improved offer in a bid to resolve the impasse before European leaders meet at an EU Council summit on December 14-15.

He told the Andrew Marr Show on BBC One: “We will make our proposals to the European Union in time for the council, I am sure about that.”

Asked if time was running out to make an improved offer, he replied: “The council is three weeks so yes.”

Donald Tusk, the European Council president, warned Britain at an EU leaders’ summit in Sweden last week that “much more progress” was needed on the bill and that British concessions needed to be delivered “at the beginning of December at the latest”.

The EU has said it will not have prepared a fresh mandate for trade talks in January if the UK has not made concessions in good time ahead of the EU leaders’ summit.

Mr Hammond also cast doubt on calls to provide a significant funding boost to the NHS as he appeared to try to manage expectations ahead of Wednesday’s Budget.

In a stark message to the Treasury earlier this month Mr Stevens said NHS performance would decline significantly without an immediate cash injection as he made the case for an extra £4bn.

Sajid Javid

Sajid Javid, the Communities Secretary Credit: Mary Turner/Reuters

But Mr Hammond said: “Let me tell you a Budget secret. In the run up to Budget people running all kinds of services, government departments, come to see us and they always have very large numbers that are absolutely essential otherwise Armageddon will arrive.”

On the issue of housing, Mr Hammond confirmed that the Government will commit to a target of building 300,000 new homes every year.

However, he appeared to rebuke Mr Javid over calls to borrow billions to fund a major house building programme.

He said: “There is no single magic bullet and it is certainly not just about pouring money in because if you pour money in without fixing the elements of supply you will simply create more house price inflation.

“That makes the problem worse not better.”

Mr Hammond also sought to make the case for the UK to embrace technological change as he said the Government wanted to see “fully driverless cars without a safety attendant in the car on the roads in the UK by 2021”.

He downplayed the suggestion that such technology could lead to a surge in unemployment, citing previous warnings that personal computers would consign shorthand typists to a life without work.

But in what appeared to be an unfortunate choice of language, he said: “Where are all of these unemployed people? There are no unemployed people because we have created three and a half million new jobs since 2010.”

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