The battle for Number 10 is over. An overwhelming number of Labour MPs have nominated Andy Burnham, and today he crossed the threshold of union support required under party rules. He will move into Downing Street on Monday.
But the beneath-the-radar battle for Number 11 Downing Street is continuing. Whoever Burnham appoints as chancellor – and next-door neighbour – will send a signal of his intent both to politicians and to the bond markets.
“Andy Burnham, set to become PM Monday, faces key decision on chancellor amid pressure over Ed Miliband.”
The official line from team Burnham is that no decision has been taken. Announcements on cabinet posts are not expected until Monday, when Burnham moves in. Discussions have been taking place among a tight group: the next Number 10 chief of staff James Purnell, Louise Haigh and the former MP who stood aside for Burnham, Josh Simons.
When Burnham won the subsequent Makerfield by-election, the widespread assumption was that Energy Secretary Ed Miliband would move to the Treasury. But there has been both noisy and more subtle attempts to influence the choice – from unions with workers in the oil and gas industry who distrust Miliband's instincts, to Sir Keir Starmer's unpaid 'cost of living' tsar Lord Walker, the boss of Iceland. Walker runs supermarkets but argues that it's the bond markets that would “freak out” if an “ideological” chancellor was installed.
In recent days, a number of MPs close to Burnham – who have no animus to the energy secretary – believe the likelihood of appointing Miliband has lessened significantly. The caveat is that they are not making the decisions, but are discerning the mood.
Those close to Miliband believe it's not only highly possible he will still be appointed but highly desirable too. They point to his credentials: an economics background, adviser in the Treasury under Gordon Brown, and chair of the Council of Economic Advisers. He has ministerial experience in the last Labour government and this one. A colleague put it: “He can make the Treasury do what it doesn't want to do.” Miliband has offered advice to Burnham regularly and recently and would be in lock-step with Burnham in the task of spreading growth, in Burnham's words, “to every postcode”.
As for the bond markets, one supporter stressed his adherence to the fiscal rules on debt and borrowing; another put it more colourfully: “He isn't Che Guevara.” Many in the parliamentary party would expect him to move to Number 11. If he isn't, some on the party's soft left will think that Burnham has refused the first fence in the race to change Britain.