Andy Burnham has laid out his vision for London after Lord Sadiq Khan was given sweeping new powers.

Writing in The Standard, the Prime Minister vowed to unleash the capital’s “untapped potential” with better transport links, more homes and investment.

He highlighted the major new powers on income tax and business rates given to the Mayor of London in the Budget on Wednesday.

“This is the first step towards developing a London Deal with Sadiq and the Greater London Authority that gives the capital more of the powers and tools it needs to unlock growth,” he said.

“There’s a misconception that giving more power to the rest of country somehow means London getting less.

“It’s something I hear all the time. But it couldn’t be further from the truth,” he added, rejecting accusations that he is anti-London.

He emphasied tht he wanted London to be “pushing even further” as it drives Britain’s economy.

“Because for all London’s success, there’s still so much untapped potential,” he explained.

The premier hailed Lord Khan’s plan to open up Stratford International Station in east London to cross-Channel services.

“The transformation since the Olympics has been extraordinary,” he said.

“But alongside that success are communities facing some of the deepest deprivation - not just in London, but nationally.

“There’s so much more we could be doing to bring in opportunities and investment to that area, especially through Stratford International, which - despite its name - has never had an international train stop there.”

The Government has given support to two Business Rate Retention Zones; one to fund the £20 million plan for the Stratford station, the second to upgrade Euston station, particularly its Tube system.

Chancellor John Healey announced the funding mechanisms in the Budget which also saw:

* The City hit with an extra 3% on the Bank Surcharge to fund help on energy bills for less well off households.

* 20 million households, including two million in London, in council tax bands A-D will get a £100 ‘Household Energy Payment’ paid directly into their bank accounts to help deal with rising energy bills. The scheme wil cost £2.6bn scheme.

* The threshold for Small Business Rate Relief for retail hospitality and leisure businesses was increased from £12,000 to £18,000.

* Renters left facing higher bills as tax on landlords was increased.

* Standing charges on gas bills will be scrapped from next year.

In a series of interviews on Thursday, Mr Healey denied postponing difficult decisions on the welfare system, insisting the Government is making changes “now”.

But Tory leader Kemi Badenoch said the country is “drowning in an out-of-control welfare system”.

The influential Institute for Fiscal Studies think tank warned the Budget delayed tough decisions.

In the capital, Lord Khan’s new tax powers is set to allow City Hall to borrow an estimated £10 billion to press ahead with scheme such as the Bakerloo line extension and the West London Orbital.

“This is just the starting point for developing a growth deal for London,” said the Prime Minister, outlining support for struggling households and plans to boost the capital’s productivity.

“Whether it’s housing, skills, supporting businesses, or attracting new investment, I’m absolutely determined to work Sadiq to unlock the potential of every part of this great city.

“London’s success is Britain’s success.”