Andy Burnham, the frontrunner for the Labour leadership, has openly clashed with the party’s interim leader, Harriet Harman, by disclosing that he told the shadow cabinet that the welfare reform bill was unsupportable and the party should not abstain at second reading if the government does not accept a raft of Labour amendments.

Harman has called for the party to abstain as a way of sending a message to the country that Labour is willing to listen on welfare matters in the wake of its second general election defeat.

But speaking to reporters on Tuesday, Burnham took the unusual step of disclosing his intervention at shadow cabinet. He said Labour should set out its reasons for opposing the bill in an amendment; if that was voted down, the party should oppose the “duplicitous bill”.

He said the bill “does not incentivise work. It does not allow for a living wage of all ages and consequently the tax credit changes will hit young people very hard. It is not supportable.” He added: “I don’t think Harriet did get it right in certain respects of the welfare reform bill.”

It appears that only two other shadow cabinet members spoke up in support of Burnham’s position, but many backbench Labour MPs agree with his determination to oppose the bill.

The dispute reveals fissures in Labour about how the party can reduce the cost of welfare in light of George Osborne’s clothes-stealing summer budget.

The bill abolishes the measurement of child poverty and has measures that will push children into child poverty Andy Burnham

Burnham’s chief leadership rival Yvette Cooper has been arguing internally for some time for a reasoned amendment to the bill but has not yet said if the party should vote against the bill if the amendment falls.

Liz Kendall has already called for the party to back Harman but to do more to oppose Tory changes to inheritance tax.

Burnham did not clarify whether he would resign from the shadow cabinet if Harman decided to press ahead with a plan to abstain, but said he believed in collective responsibility. He refused to reveal whether one of his strongest supporters, Rachel Reeves, the shadow work and pensions secretary, had backed Harman.

Harman is now taking further advice before pressing the shadow cabinet into a decision.

Burnham said the welfare reform bill “contains punitive measures in respect of child poverty and dismantles the whole focus of the last government brought to child poverty. It is unsupportable because it does not do what it says on the tin – support work. In fact it does the opposite. It diminishes the work incentives with its changes to tax credits and employment support allowance. It abolishes the measurement of child poverty and at the same time it has measures that will push children into child poverty.”

Burnham insisted his stance did not mean he was turning against welfare reform, saying he would set out a Labour alternative in a speech on Wednesday , including tax incentives to allow councils to build more homes and so cut the housing benefit bill.

“It is crucial to face up to difficult issues if we are to regain the ears and trust of the public,” he said. “I have said that just defending everything we did on the economy in government is not going to win back people’s attention. If you acknowledge what you did not get right, then people are more prepared to give you credit for what you did get right.

“One of our biggest failures in the last parliament is to counter the narrative of Labour’s mess. Labour ran a strong economy [from] 1997 to 2007. We did fix the roof when the sun was shining, but I have acknowledged that we did let the deficit get too high.”