The former chief economist at the Bank of England has warned Andy Burnham he is running what looks like ‘a traditional tax and spend socialist government with better TikTok videos’.

Andy Haldane, who has advised the Prime Minister on the economy, warned that bond market investors would continue to drive up borrowing costs unless there are cuts to spending.

‘The fiscal Achilles' heel of this government, thus far, has been its unwillingness and/or inability to cut public spending,’ he told LBC.

And with UK borrowing costs the highest in the G7 ahead of next month’s Budget, Mr Haldane added ‘a few hard choices are looming on the horizon’.

Mr Haldane was among the high-profile economists Mr Burnham turned to for advice before seizing power as he sought to win fiscal credibility with the markets.

The former Greater Manchester mayor has been dubbed ‘the first TikTok Prime Minister’ as he discards the buttoned-up style of Keir Starmer and turns to a more casual approach on social media to drum up support.

He has nearly three million followers across various platforms including 804,000 on Instagram, 750,000 on X, 716,000 on Facebook and 608,000 on TikTok.

But fears are mounting that the Budget next month will include yet more borrowing and another round of tax hikes to fund his lavish spending plans.

Speaking to LBC on Tuesday, Mr Haldane warned the recent surge in bond yields poses a major headache to the PM and his Chancellor John Healey ahead of the Budget on October 28.

With much of their fiscal headroom wiped out, it is feared they will turn to yet more tax hikes and extra borrowing rather than spending restraint to make the numbers add up.

But experts believe that risks an adverse reaction on the bond markets where the UK already pays more to borrow than any other major developed nation in the G7.

The yield on UK 30-year bonds is at a 28-year high while the interest rate on ten-year debt is at its highest since 2007. 

Commenting on the scale of the challenge facing the PM and Chancellor, Mr Haldane said: ‘Well, it's got a lot steeper over the past two weeks given what's happened to borrowing costs.

‘I think the plan had been a low drama, no drama Budget. I think that's been torpedoed by events over the past couple of weeks, and that will make next month on the 28th for some hard choices from this government.

‘A few hard choices so far, but one is looming on the horizon now about how any hole to the Budget headroom is made good on. Is that a question of tax rises, or is it a question of taking the knife to public spending?’

Mr Haldane conceded that public spending cuts would be met with fierce opposition from Labour MPs – but would also show the markets the government was ‘serious’.

He said: ‘Any step in that direction would cost you something in political capital, with the backbenchers and beyond possibly.

‘Ultimately, it's only by taking actions that come with a political cost, that you convince financial markets that you are serious. Within financial markets, we've gone from the cautious optimism of the summer months to the studied scepticism of September.’

Mr Haldane went on: ‘The markets now suspect that this is a traditional tax and spend socialist government with better TikTok videos.

‘It will only be an act of doing something on one of the big spending departments, it could be welfare, it could be triple lock pensions, it could be the NHS, it could be an across the piece productivity improvement across the public sector.

‘Each of those individually would buy you, one, a lot of money, and two even more in instant credibility. That would lower borrowing costs. It would almost pay for itself as a growth dividend.’