A former Bank of England governor has accused Rachel Reeves of searching for answers to raise funds “on the back of a fag packet”. Lord King’s scathing seven-word swipe of the Chancellor came as he warned she lacks a “coherent” strategy on tax.

Ms Reeves is widely expected to raise taxes and cut spending in her Budget next month to fill a huge black hole in public finances. Economists estimate the gap to be between £20billion and £50billion. Reports suggest Ms Reeves is considering a new mansion tax, as well as a manifesto-busting 2p hike to income tax.

Lord King, who led the Bank of England through the 2008 financial crisis, told the Sunday with Trevor Phillips show on Sky News: “What I would advise her to do is to set up a group of people who, in 12 months, look deeply at all aspects of the tax treatment, not just on property, but all kinds of other sorts of savings and wealth, to come up with a coherent view as to what it should look like.

“And that doesn’t seem to happen. What happens is, the OBR [Office for Budget Responsibility] produces just before the Budget a number, one number, and then they look around for, you know what idea is, almost written on the back of a fag packet about how you can raise an extra few billion here or few billion there.

“That is not a coherent tax strategy, and you could do a great deal by thinking it through first.”

When asked whether he could “discern a plan” from the Chancellor, the crossbench peer answered “no I can’t”.

“And that’s what worries me,” he added.

Ms Reeves is set to unveil her Budget on November 26.

Health Secretary Wes Streeting admitted on Sunday that public finances are in a “challenging state”, while also insisting there were “green shoots” of economic recovery.

However, he added “we’re not out of the woods yet”, adding Ms Reeves has a “challenging job”.

The Chancellor is weighing up a new mansion tax, according to the Mail on Sunday.

It reports this would hit owners of properties with an annual charge of 1% of the amount by which its value exceeds £2million.

Meanwhile, The Sun on Sunday suggested she was considering the 2p hike to income tax.

Earlier this month, the International Monetary Fund projected the UK to have the second-fastest growing economy in the G7.

However, it also forecasted that UK inflation was set to surge to the highest out of any G7 nation in 2025 and 2026.