Billions of pounds in public money was committed in the run-up to the election campaign in a deliberate strategy to boost Labour's chances at the ballot box and sabotage the next government.
One former Labour minister told The Sunday Times: "There was collusion between ministers and civil servants to get as many contracts signed off as possible before the election was called."
One former adviser to the schools department said there was a deliberate policy of "scorched earth". "The atmosphere was 'pull up all the railways, burn the grain stores, leave nothing for the Tories'," he added.
The disclosures come as George Osborne, the chancellor, prepares this week to reveal details of an initial £6 billion of cuts to help plug the hole in the £163 billion deficit. A full emergency budget next month will see some departmental budgets being slashed by up to 25% as well as tax rises, including a possible hike in Vat.
Many ministers are spending this weekend going through their red boxes trying to understand the scale of the budgetary black holes facing their departments.
This week the government is expected to call a temporary halt to recently signed IT contracts, while new public sector construction projects will be reviewed.
The "black holes" that ministers have already unearthed include:
- A series of defence contracts signed shortly before the election, including a £13 billion tanker aircraft programme whose cost has "astonished and baffled" ministers.
- £420m of school building contracts, many targeting Labour marginals, signed off by Ed Balls, the former schools secretary, weeks before the general election was called.