Prime Minister Andy Burnham has refused to rule out raising taxes in the upcoming autumn Budget, warning that the government finds itself in a challenging economic position.

Speaking during his first official overseas visit to Ukraine, the Prime Minister insisted he will take a careful approach to managing the public finances, saying he will not take risks with family budgets, livelihoods, or jobs.

Pushed on whether taxes must rise to plug spending gaps, Burnham pointed back to his record in local government, noting that he ran Greater Manchester for ten years with a tight ship and rock-solid finances. He maintained that nothing will change in his new role, stressing that while he will do what he can to help people, he will not be unrealistic about what is achievable.

Burnham took office in July promising to give households breathing space amid severe cost-of-living pressures. So far, his measures have included capping bus fares at £2 and cutting VAT on household electricity bills, both of which he defended as fully funded through reprioritising existing budgets. However, he has previously acknowledged to the BBC that these steps are not enough on their own, hinting that further support will arrive in the autumn.

Yet major questions remain unanswered about how the government intends to finance larger commitments, including long-awaited social care reforms.

The broader economic backdrop leaves very little room for manoeuvre. Official figures show government borrowing came in higher than expected in July, despite a record month for income tax receipts. At the same time, inflation climbed to a four-month high of 2.9 per cent, with expectations of further rises driven by the ongoing impact of the Iran war on fuel and energy costs.

Independent experts have warned that Burnham and Chancellor John Healey have virtually no scope for additional borrowing, meaning they will either have to raise taxes or cut spending elsewhere. Both have pledged to stick to the fiscal rules inherited from former chancellor Rachel Reeves, which require day-to-day spending to be funded entirely by tax receipts by the end of the Parliament, while reducing debt as a proportion of GDP.

At the same time, industry leaders are warning against placing further burdens on companies. Rain Newton-Smith, chief executive of the Confederation of British Industry, told the Today programme that the rising cost of employing people is already holding firms back from creating opportunities for young people, arguing that targeted support for business is needed to stimulate growth and generate tax revenues.

All eyes will now be on the Treasury ahead of Burnham and Healey's first Budget on 28 October, where we will learn exactly how the government plans to square these competing pressures. I'll be following this one.