Allies of Sir Keir Starmer believe Andy Burnham is readying himself to challenge the Prime Minister for the Labour leadership.
The Manchester Mayor launched a new left-wing campaign group earlier this week, seen as the groundwork for a bid for the top job amid growing speculation that Sir Keir Starmer will be forced to resign.
The group "Mainstream", set up amid concern Downing Street was sidelining the left of the party following the resignation of Angela Rayner, calls on Downing Street to introduce wealth taxes, nationalise utility companies and end the two-child benefit cap.
Mr Burnham's new campaign was "setting out his stall" to become the party leader, Labour sources told the Telegraph.
The Mayor of Greater Manchester is also expected to openly criticise the Prime Minister at Labour’s annual party conference later this month in what many have predicted to be a direct challenge to the Labour leadership.
The Mayor is set to call for a “reset” to help Labour regain its popularity amongst the British public.
Despite not currently being an MP, Mr Burnham previously served in Gordon Brown's Cabinet as Chief Secretary to the Treasury from 2007 to 2008, Culture Secretary from 2008 to 2009 and Health Secretary from 2009 to 2010.
The former Labour MP for Leigh has also supported Lucy Powell in Labour’s deputy leadership race, seen as an attempt to secure an ally at the top of the party.
The new campaign has been compared to Together Labour, a British think tank, founded in June 2015 and closely associated with Keir Starmer's 2020 leadership election campaign, which opposed Jeremy Corbyn.
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Andy Burnham has launched a new left-wing campaign group seen as groundwork for a Labour leadership bid
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A "Mainstream" spokesman did not deny that it could become a leadership vessel for Mr Burnham modelled on a similar group which helped project Sir Keir into the top job, according to the Telegraph.
Labour has fallen significantly in the polls, losing supporters to both Reform UK, the Liberal Democrats and the Green Party.
Despite an attempt to “reset” his Government with a major cabinet reshuffle just 14 months after winning the 2024 General election, the Prime Minister has been personally criticised over his recent handling of the Lord Mandelson and Angela Rayner scandals.
Sir Keir was forced to give in to Labour rebels, including Mr Burnham, who threatened his premiership in July over the benefit bill, and continues to face increasing pressure over his confidence in Chancellor Rachel Reeves ahead of her Autumn budget, where it is feared she will bring further tax hikes.
The Mayor of Greater Manchester is also expected to openly criticise the Prime Minister at Labour’s annual party conference later this month
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Political editor of Times Radio, Anna Mikhailova, told GB News: "There was already talk about Andy Burnham a week ago, before everything with Peter Mandelson.
"He also criticised Keir Starmer, not just the Government but the actual management style of the party, because a lot of this goes to the heart of how unhappy MPs are with how Number 10 and Starmer has been handling them from day one.
"Andy Burnham actually said, how can we have a Labour Party that has kicked out people like Rachel Musk. He actually namechecked the MP who was suspended over the winter over the welfare reform rebellion."
Speculation amongst MPs suggests that Mr Burnham and Ms Powell could swap jobs, with the MP running to replace him as mayor while he campaigns for her seat.
The Mayor is set to call for a 'reset' to help Labour regain its popularity amongst the British public
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Allies close to the Mayor had been exploring ways to get the former Health Secretary a parliamentary seat at the next general election, according to reports.
One ally of the Prime Minister told The Telegraph they expected Mr Burnham to launch a leadership challenge as soon as next May to coincide with the local Scottish and Welsh elections.
They said: “I assume he’s not just saying unhelpful things out of totally disinterested glee. This is someone who has an agenda of self-promotion."
Another Labour MP told the publication that Mr Burnham’s new group had been interpreted as a challenge to Sir Keir.
The Prime Minister has been personally criticised over his recent handling of the Lord Mandelson and Angela Rayner scandals
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They added: "What has accelerated its development is that the Labour Government’s in trouble with the public, and there is now a king over the water, in the shape of Andy Burnham."
"This is really about Andy setting his stall out to become leader of the Labour Party."
Downing Street said Sir Keir Starmer still had confidence in his “top team” following questions over his chief of staff.
A spokesman added the Government was "getting on with the important work”.
GB News has reached out to Mainstream and Mr Burnham for further comment.
The Prime Minister has also been contacted for a comment.