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In his childhood, gazing from afar at Margaret Thatcher like a child in “The Boyhood of Raleigh”, Rishi Sunak may have dreamed of one day becoming a Chancellor amidst halcyon days of high growth and a budget surplus.

In the Treasury, civil servants will have yearned during recent years for a Budget that’s a Budget on one side of the year and a statement that’s a statement on the other – never mind which, as long as the distinction between the two is maintained.

It can’t be altogether this Wednesday for reasons that leave Sunak’s teenage longings, assuming he had them, as yet more evidence of the vanity of human wishes.

His Chancellorship may well be defined by pandemic and war, two of the four horsemen of the Apocalypse (almost).  At 95 per cent of GDP, public sector net debt is at its highest since the early 1960s.  At 12 per cent of GDP, the budget deficit is higher than at any time since the Second World War.

And while last year’s growth figure will come in at 7.5 per cent or so, the evidence of recent years is that it is running at less than it did before the financial crash.

High debt, low growth and high deficits are familiar features of Britian’s post-financial crash economy, although George Osborne succeeded in grinding down the latter during his term as Chancellor.  But the context in which this trio are set is one that is unknown since modern times.

Economists and politicians have been debating since the pandemic began to ease whether the subsequent inflation will stay or go.

But the price rises we’re experiencing can no longer be dismissed as the temporary consequence of bottlenecks in the world economy, as atrophied supply struggles to meet reviving demand.  Vladimir Putin’s atrocious invasion of Ukraine has changed nearly everything.

As the book of Revelation puts it: “And there went out another horse that was red: and power was given to him that sat thereon to take peace from the earth…and there was given unto him a great sword.”

On this site today, Anthony Browne compares the shockwaves of the Ukraine conflict to the Yom Kippur War of 1973, which unleashed more inflation – or rather, intensified stagflation, that deadly combination of low growth and high inflation from which Margaret Thatcher delivered us during the 1980s.

The better news is that while the horror of the Ukraine war and the threat of stagflation narrow Sunak’s options, they don’t close them down completely.

First things first.  The Treasury purists may gnash their teeth, but the Chancellor doesn’t have the option, in the raw terms of primal politics, of primly declaring that he’s already announced a support package, that the Budget is due in the autumn, and that we must all wait for more action until then.

Such inaction simply isn’t practicable amidst the biggest fall in living standards since comparable records began. Sunak knows well that he must show the voters that he cares.

Which means the wartime equivalent of his Covid schemes: in other words, supporting people and families.  In February, the Chancellor announced a council tax rebate for those in bands A-D and an energy bills discount which must later be returned.

He said of the latter that repayments would begin “from 2023, when global wholesale gas prices are expected to come down”. That timetable now looks doubtful.

So he could continue where he started in his statement on Wednesday by increasing the rebate and lengthening the timetable for the discount returns.  There is little doubt where he will go next: see David Gauke, David Willetts, Conor MacDonald, Tom Cloughterty and James Kirkup on this site last week.

Sunak will surely bring forward the benefits uprating by some means to increase Universal Credit, the state pension and public sector pay by more than he had planned.

The Chancellor will have little time himself for the national insurance rise that he agreed at Boris Johnson’s behest to pay for more NHS spending.  But he can’t now scrap it even though he knows he should do so.  The Centre for Policy Studies wants him to raise the threshold for national insurance to compensate.

This is a good idea, and Sunak should add to it the list of prospective measures that ConservativeHome published in January.

Namely, raising the minimum wage, shifting the green levies on energy bills to taxpayers, cutting VAT on those bills and increasing the availability of the Warm Homes Discount.  That the Chancellor is also under pressure from Tory backbenchers to cut fuel duty shows how much Net Zero targets count for them when push comes to shove.

Sunak has a special interest in helping families and the Prime Minister is now worrying about their childcare costs.  This site has a long-established position of supporting families through new tax allowances or higher child benefit.

Either commitment would be a substantial one to make, and the tax allowances would need some complementary measure for those who don’t pay tax.  Given the impact of the cost of living crisis on poorer families especially, the most targeted measure the Chancellor could take would be to scrap the two child cap on Universal Credit.

Where will the money for these special measures comes from?  Sunak’s options aren’t completely closed because he is likely to have a growth windfall from Britain’s post-Covid bounce as he did at the time of last year’s Budget.

Many Conservatives will argue that he has another – to cut taxes and borrow.  Those who will do so tend always to do so, and whether they’re right or wrong depends on the wider context.  During the pandemic, they were right.  More recently, they were wrong.

The crucial factor is interest rates.  Governments can’t increasing their borrowing if rates are rising too – at least, not with our levels of debt and deficit.

The big question now for the Chancellor, and all the rest of us, is what impact the war will have on rates.  One plausible take is that if it’s brief they will take an indulgent view of more borrowing but that if lasts longer they won’t.  Sunak will doubtless take the gamble on Wednesday.

If it blows up, he will be left with little option but to look with renewed vigour at the spending side of the ledger – and wield the axe.

In which case, it will time for Jacob Rees-Mogg to step up to the plate in his new role as Minister for Government Efficiency, and deliver the savings he said are there in his first Moggcast since the appointment.

So while neither Sunak nor the institutional Treasurey will want to a Budget delivered on Wednesday, the Chancellor will not only have to announce more protection for Brits from that second horseman, war, just as he did for the first, pandemic, but give it some wider context.

He will have to persuade voters that government has no instant solution to every problem – including the war in Ukraine.  Such a downbeat tune will struggle to be heard above the noise of Johnson’s relentless Boosterism.

But the war might well have been deterred had the West been more resilient.  The Chancellor must demonstrate on Wednesday how the resilience of which there should have more prior to Covid will now be stepped up – in terms of energy, defence and food security.

That will leave little space for the wider ambitions on productivity he spelt out in his recent Mais lecture.  That’s how it goes when pandemic and war bust a civilisation’s complacency.