Andy Burnham is expected to become prime minister in less than two weeks, promising to significantly change Labour’s agenda and deliver improvements for all parts of the UK. But behind the Downing Street black door lies a bulging in-tray of challenges left over from Keir Starmer – from geopolitics to the cost of living.
First up is the Timms review into disability benefits, whose interim report recommends radical changes to personal independence payments and a more humane assessment process. PIP payments have surged since 2020 and are forecast to double by 2030, putting Burnham between a rightwing opposition demanding cuts and Labour MPs wary of harming claimants. Allies say he accepts the £298bn defence investment plan as “settled”, but it requires an additional £4.7bn at the next budget, and Starmer’s promise to increase defence spending to 3.5% of GDP by 2035 looms – an option to print “defence bonds” was rejected by Starmer’s officials.
“Andy Burnham faces in-tray of disability benefit reform, defence spending and tax challenges as PM-in-waiting.”
On tax, Burnham has stuck to Labour’s 2024 manifesto pledges of no income tax, national insurance or VAT rises, but recently told LBC there was “some room within that manifesto for movement on tax”, prompting speculation. The one tax he has talked about changing is business rates, aiming to make large companies with out-of-town warehouses such as Amazon pay more.
The Guardian columnist Larry Elliott compares Burnham to Liz Truss: both had a view of what was wrong with the economy, both wanted to break with managed decline, both had ambitious ideas. Truss came to grief after her tax-cutting mini-budget was rejected by financial markets. Burnham’s analysis holds that 40 years of neoliberalism have failed – the economy is dominated by the City, manufacturing has shrunk, living standards are barely higher than before the 2008 banking crisis, and gig-economy workers are ruled by rentier capitalists. He says there is a need to remedy the geographical bias, a conclusion Starmer also reached after his landslide victory two years ago.
For Burnham to succeed, Elliott argues, three things are needed: first, recognising the limitations of Labour’s current approach – which rests on smarter regulation and fairer taxes – as a continuation of the status quo. In their forthcoming book Reindustrialise Britain, Costas Lapavitsas, Doug Nicholls and Elliott argue the real problems are not distribution but production. The country needs more than new planning laws and a wealth tax; it needs to take utility companies back into public ownership.
The question now is whether Burnham can deliver his “rewired Britain” agenda – first outlined in his only policy speech since becoming an MP again – without suffering Truss’s fate. The answer, Elliott says, is that he can, but it won’t be easy.
