The audience member savaged the Mayor for Greater Manchester for his party being “deceitful” and “hiding the amount they were borrowing” by using private contractors to build hospitals - aka PFIs (private finance initiatives).

Speaking in relation to the recent Carillion scandal, the audience member from Hereford said: “The process of PFI is quite deceitful because in many ways it is simply concealing the amount that the Government is borrowing.

“Andy said earlier that there was a choice of a PFI hospital or no hospital and I think that is ridiculous.

“Because if they could afford to rent a hospital for the next 30 years on an inflation-linked contract then they could afford to borrow money which would have been so much cheaper, at a much lower rate and then they would have been able to afford the other things we presently can’t afford.”

Mr Burnham immediately rebutted the audience member’s point: “I agree with you.”

He added: “I was saying that the choice we were given was the wrong choice. We should not have been told 'PFI or no hospital'.”

BBC Question Time presenter David Dimbleby interjected: “Who told you that?”

Mr Burnham replied, cutting him off slightly: “That was the treasury…”

But, the chairman of RBSan former Deputy Governor of the Bank of England Howard Davies hit back at the Labour Mayor’s wild claims.

He blasted, pointing his finger furiously: “Treasury officials have never liked PFI, I was a treasury official myself, they have never liked PFI.”

Mr Burnham argued: “I am telling you that was my experience of being in Government at that particular time.”

Mr Dimbleby would not relent and pointed out that Mr Davies has never heard of anything like it and he was Deputy Governor.

He added: “He told you that, was it your Chancellor Gordon Brown or was it the Treasury?”

Mr Burnham stammered: “It was, it was, both. It was Gordon Brown and the Treasury Policy.”

Mr Davies laughed and heckled “it’s not true”.

The Labour Mayor said that when he was Health Minister in 2009 he decided he could no longer support outsourcing NHS services to private companies and sought to change the policy.

It comes as Carillon, the second largest Government contractor, went into liquidation on Tuesday morning.

Around 20,000 jobs are at risk after bosses at the stricken firm said they had "no choice but to take steps to enter into compulsory liquidation with immediate effect”.

Following the collapse, Labour leader Jeremy Corbyn criticised the Government for what he called an “outsource-first dogma”.

However, the BBC’s Nicholas Watt reminded the politician it was his own party who were keen to introduce widespread use of PFI schemes similar to those Carillon were in charge of.

Citing conversations with senior MPs he said while Carillion’s collapse played into “the meta-narrative” that “Tories are about protecting our private sector friends” he added that it was worth remembering that “most of this process started under Tony Blair”.