A Tory donor has admitted that the party is not fit to run the country - saying the UK is now on the path to being the "sick man of Europe".
In a scathing assessment of the Conservative record in power, Guy Hands also warned that Britain might need a bailout from the International Monetary Fund (IMF).
Private equity boss Mr Hands said the British economy is "doomed" if the Conservatives do not "own up to" Brexit mistakes and find a leader who can renegotiate with the EU.
Former Chancellor Rishi Sunak is expected to be named as the next Prime Minister later today.
Asked if the Conservatives were fit for office, Mr Hands, who founded finance firm Terra Firma, told BBC Radio 4's Today programme: "No, to be quite blunt.
"I think it's got to move on from fighting its own internal wars and actually focus on what needs to be done in the economy and admitting some of the mistakes they've made in the last six years, which have, frankly, put this country on a path to be the sick man of Europe."
He warned of worsening economic conditions and the spread of poverty "across the whole of society".
Mr Hands said the UK could face "steadily increasing taxes, steadily reducing benefits and social services, higher interest rates, and eventually the need for a bailout from the IMF like we were in the '70s."
In 1976 the UK government negotiated a £3.9 billion loan from the IMF as the UK plunged into a currency crisis, with roots in a disastrous Tory budget
And he warned that the effects of the current cost of living crisis would have a wide impact, stating: "It's not just the 17% of children who are now suffering from malnutrition in the UK, it is now middle-class people who will not be able to pay their mortgages when they are reset who are finding it difficult to make ends meet, and it will just it will move across the whole of society."
He accused Liz Truss of being out of touch with the British public and bringing in tax reforms that lacked support.
Mr Hands said: "The reality is, when they did Brexit, they had a dream, and the dream was a low-tax, low-benefit economy."(Liz) Truss, to be fair to her, tried it. It clearly isn't something that's acceptable to British people - the British people have never voted, or even shown any inclination to vote, for the sort of extreme Thatcherism that Brexit needed.
"Once you accept that you can't actually do that, then the Brexit that was done is completely hopeless and will only drive Britain into a disastrous economic state.
"So, I think, if the Tory Party can own up to the mistakes they made in how they negotiated Brexit and have somebody leading it who actually has the intellectual capability and the authority to renegotiate Brexit, there is a possibility of turning around the economy, but without that the economy is, frankly, doomed."
