According to those who work in the Chancellor’s office, the words “general election” have not crossed his lips in the hours, days and weeks leading up to his second Budget.

However, today’s statement will set the tone not only for next year’s campaign but almost certainly for the two terms of government that follow, whichever party is in charge.

If the election has not been the first thought in Alistair Darling’s mind, it almost certainly has been at the forefront of changes and subtle adjustments proposed by Gordon Brown as the two met several times a day to finalise today’s offering.

Theoretically Mr Darling has two more bites at the cherry, with a Pre-Budget Report in November and a pre-election Budget next March, but this really is the one that matters. It will set the political and economic strategy for the final year of this administration and is the one that can really have a noticeable impact in time for a poll next year.

A Cabinet minister said yesterday: “Alistair will be more interested in how this Budget looks in six months rather than six days.”

So the stakes could not be higher for the Chancellor. But, for someone with the task of delivering the grimmest set of economic figures in budgetary history, Mr Darling has appeared surprisingly cheerful and self-confident in recent days. A senior Cabinet minister told The Times: “Alistair gets stronger and stronger by the day. His judgments are being vindicated and somehow he just looks right in the job.”

What a change from late last summer when his position appeared threatened after he upset Downing Street with his prediction — now rather harmless looking — that the recession could be the worst for 60 years. Friends say that he became increasingly convinced during last year — after he tried without success to find a buyer for Northern Rock and held talks with the country’s leading bankers — that the news was going to be worse than most expected.

This time round it has been a different, an optimistic Chancellor despite him having to acknowledge probably the longest recession since the war and almost unthinkable levels of borrowing, to the background of soaring unemployment and deflation.

The briefings emanating from the Treasury have been relatively upbeat and on Sunday suddenly Mr Darling popped up on YouTube to speak of his confidence that the recovery really is coming. The medium is a useful one for a Chancellor, in purdah before a Budget, to get over the message that he wants without being questioned.

Mr Darling is hoping that, having been more right than many about the depth of the recession, he will be believed about the upturn. He needs the markets to believe that, but he also needs to be right if the ghastly chasm in the public finances that he will unveil today is ever to be put right.

There have been intense discussions between Mr Darling and Mr Brown over recent days about the extent to which he should outline today the measures needed to bring the finances back into balance over eight, nine or ten years. What he has outlined so far — new taxes on the higher paid, a 0.5 per cent rise in national insurance, both from 2011, and another efficiency squeeze on Whitehall budgets — will in no way do the trick. He needs growth, growth and more growth to start filling up the Treasury coffers with tax receipts again and to reduce the financial toll of unemployment. However, today’s jobless figures are expected to reach roughly the level that Labour inherited in 1997.

Today there may be more deferred tax rises, and more on spending, but this Government and the potential Conservative alternative will still be left knowing that the speed at which the position improves depends on factors outside their control.

Whatever is announced will pose a challenge to George Osborne, the Shadow Chancellor, as well as to Labour MPs. Mr Osborne has indicated that he would not seek to stop the tax rises on the better-off, but would like to prevent the national insurance increase if he could. Today he may have to set out his line on much more.

Similarly, the discussions have been lively on the amount of money to be put into the economy today and whether it should be called a second fiscal stimulus. The measures disclosed so far on housing, green technology, and employment are heading towards £4 billion.

No one knows what has gone on behind closed doors in Downing Street as Mr Brown and Mr Darling have clinched the deal. But his ministerial colleagues sense an inner strength in Mr Darling, a feeling that he may have been in a better position this time to resist some of Mr Brown’s demands.

The Prime Minister knows that he has been damaged internally by the e-mail smear row set off by his close adviser Damian McBride, while Mr Darling looks like a Chancellor almost certain to stay in post until the election. Today he will be like a doctor telling the patient that the news is bad, but not terminal. A colleague said yesterday that Mr Darling knew that he had another year in the job at most, whoever wins the election. Another said that Mr Darling was a collegiate man and that “he will do all he can for Gordon in the Budget”.

Such remarks leave the impression that Mr Darling is driven just as much by the need to protect his own reputation and that of the Treasury as he is by electoral considerations. Today will be the start, but only the start, of the process by which he is judged.

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