Andy Burnham will face his first Prime Minister’s Questions, and an early test of his authority over Labour backbenchers, after being threatened with a £6 billion blow to the Government’s Budget plans.

The Labour leader made his debut at the Commons despatch box on Tuesday, when he set out his vision to devolve more power away from Westminster and into the regions, and to take back public control over utilities.

On Wednesday he will face MPs and Tory leader Kemi Badenoch again at Prime Minister’s Questions (PMQs).

Mr Burnham has blamed the legacy of Margaret Thatcher, the austerity era and Brexit for decades of slow growth in Britain, and insisted his plans to change the “failed economic model” would kickstart the economy.

“Britain is not where any of us would wish it to be,” he told MPs, adding: “Things are not working as they should, life is too expensive and too hard for too many.”

During his Commons outing, he described Britain’s water industry as “a leaking monument to that approach, a country run in the private rather than public interest”.

Throughout his three hour and 23 minute grilling, the Prime Minister declined to say whether there will be tax rises at the October 28 Budget.

It came as middle income earners look increasingly likely to face a fresh tax squeeze after gilt markets threatened to blow a £6 billion hole in the Chancellor’s Budget plans.

Britain’s long-term borrowing costs jumped to their highest level in 28 years on Tuesday as investors sold off Government bonds in a bet on higher inflation linked to signs of escalation in the Middle East.

Chancellor John Healey was warned that any major spending sprees in his Budget risked making the UK bonds sell-off even worse.

But the Prime Minister has suggested that Mr Healey will still find money to hike defence spending to 3% of GDP by 2030 by the time of the next spending review.

The Guardian reported that Mr Burnham told Cabinet on Tuesday that his Government will have three priorities: cutting the costs of essentials such as childcare and mortgages, regenerating communities, and greater public control over utilities such as water, energy and housing.

Labour backbenchers pushing for faster reforms to electoral law could provide Mr Burnham with his first Commons headache on Wednesday, after he has faced Ms Badenoch at PMQs.

Alex Sobel, the Labour MP for Leeds Central and Headingley, is leading calls among backbenchers to establish a national commission on reforming the voting system.

He has tabled an amendment to the Representation of the People Bill, which will be debated in the Commons later today, calling for the Government to back the move.

Mr Burnham on Tuesday suggested he was open to the idea of electoral reform, but told the Commons that “we will need to get a consensus at the next election” to make such a change.

Veteran Labour MP Dame Emily Thornberry has meanwhile pressed the Prime Minister to back her amendment to the Bill which would ban “overseas voters” from financially backing political parties.

The Prime Minister was reported to have steered away from plans for a £500,000 cap on all political donations in the summer, amid concern about its impact on Labour’s trade union backers.