UK Tory party leadership contender Liz Truss has suggested Britons lacked "skill and application" and needed to work harder, in a leaked audio recording.

In the two-minute audio clip, which dates from her time as a senior minister in the finance ministry between 2017 and 2019, Ms Truss said workers' "mindset and attitude" were partly to blame for the UK's relatively poor productivity.

"It's working culture basically," she said in the recording, obtained by the Guardian newspaper, adding British workers needed "more graft".

"If you go to China it's quite different, I can assure you.

"There's a fundamental issue of British working culture... I don't think people are that keen to change."

The leak comes as Ms Truss emphatically leads rival Rishi Sunak in numerous polls in the race to become prime minister when Boris Johnson stands down early next month.

The party's roughly 200,000-strong membership have already starting voting for their next leader, who then becomes prime minister.

The result of the summer-long contest will be announced on 5 September, with the new leader set to take charge the following day.

Rishi Sunak speaking at a hustings event in Scotland

The two leadership contenders, who have waged a bitter battle over recent weeks featuring frequent hostile briefings and counter-briefings by their camps, participated in a hustings event in Scotland this evening.

The incendiary remarks by Ms Truss echo controversial arguments made in a 2012 book she co-authored, "Britannia Unchained", in which British workers were described as among the "worst idlers in the world".

Asked about it at a leadership debate last month, Ms Truss distanced herself from the contentious assessment, claiming co-author and Sunak supporter Dominic Raab, who is currently justice minister, had penned it.

Mr Raab has subsequently said the writers of the book, which also included several other senior Conservative ministers, had agreed "collective responsibility" over its contents.

In the leaked audio, Ms Truss, who backed remaining in the European Union during the divisive 2016 referendum, before subsequently becoming a Brexit supporter, also appeared to suggest the EU and migration are unfairly criticised.

"We say it's all Europe that's causing all these problems. It's all, 'it's migrants that's causing problems'.

"But actually what needs to happen is, you know, a bit more graft," she said, with a laugh, before adding "it's not a popular message".

A Truss campaign source branded the leaked comments "half-a-decade-old" and lacking "context", while acknowledging that Britain does "need to boost productivity".

"As prime minister, Liz will deliver an economy that is high wage, high growth and low tax," the source added.