Burnham's former adviser Andy Haldane warns the PM risks a Truss-style crisis unless public spending is slashed in the Budget

Andy Haldane, the former Bank of England chief economist, called the £2bn tax raid on banks 'penny wise, pound foolish' and proof that ministers lack the nerve to cut spending. He warned that Britain is close to being 'taxed out and maxed out' on borrowing. Chancellor John Healey is due to deliver the Autumn Budget on October 28. Haldane said the economy is Andy Burnham's 'blind spot'.

Haldane fears a 'mañana' Budget that fails to 'speak to the urgency of now'.

'The penny has not yet fully dropped, including in Downing Street,' he warned.

He still believes Burnham could become a 'great Prime Minister'.