Leadership uncertainty is "enormously disruptive" and presents a "big challenge" for the government, a former cabinet secretary has said.

Simon Case, the UK's highest-ranking civil servant from 2020 to 2024, told the BBC's Sunday with Laura Kuenssberg that political upheaval also "costs us money" by driving up borrowing costs.

His comments come after Andy Burnham won Thursday's Makerfield by-election, paving the way for a Labour leadership challenge.

An ally of Sir Keir indicated on Sunday that he was considering what was in the best interest of the country when it came to his political future, while the Tories said a change of leader was unlikely to change how Labour was governing.

Downing Street said earlier on Sunday that the prime minister was "getting on with the job" and that his position of being "determined to fight for his job" had not changed.

Burnham's allies have urged Sir Keir to reflect over the weekend and listen to his cabinet ministers, MPs and his family.

The former Greater Manchester mayor's team - and that of another potential challenger Wes Streeting - had said they would not be giving interviews over the weekend, in an apparent bid to give Sir Keir time to change his mind.

Case served as the most senior government official under four prime ministers - Boris Johnson, Liz Truss, Rishi Sunak and Sir Keir - in quick succession, during a period of uncertainty and upheaval at the top of UK politics.

He stepped down in December 2024 on health grounds and was made a peer the following year.

The cabinet secretary role involves advising the prime minister, implementing government policy, and managing other top civil servants.

Case told the BBC that the uncertainty surrounding the prime minister's future was a "big challenge and a big problem for government", adding that the markets were already responding to the possibility of a leadership challenge in the UK.

"The amount of money we are paying for the enormous level of debt that the country has are going up with every moment of uncertainty," he said.

Case said that "while politicians are having conversations amongst themselves about who should be leader", time was lost to fix "issues of real significance to people up and down the country in the health service and education".

Business Secretary Peter Kyle said the prime minister was "making time this weekend to try and reflect on the political challenges he faces, our country faces, our party faces".

"We as a party have had to learn the lessons of where the Conservative Party failed, time and time again," he said.

"Where there was political uncertainty in their party, they put the chaos onto the country. We are not going to do that."

Conservative shadow chancellor Mel Stride said: "Clearly you need stability, but you need the right policies."

He said that even though a change of prime minister "looks increasingly likely", this was not going to change "the fundamental nature of the Labour Party", which he characterised as preferring high taxes and high borrowing.

Delays to decision-making

Changes in leadership also mean important decisions are deferred, Case said, pointing to the recent resignation of Defence Secretary John Healey.

"Current decisions aren't being taken that are desperately needed on how much money we should be spending on defence," Case said.

Asked what his advice to Burnham would be if he were to become leader, Case said: "Do as much preparation as you possibly can, surround yourself with the best people and, by God, do your homework."

He added that Burnham would not resolve the big challenges facing the UK by "coming in and thinking you can govern simply by being a better communicator or somehow vibe coding".