Chancellor Rachel Reeves has thrown her support behind Andy Burnham to be the next prime minister, insisting that her economic strategy is "beginning to bear fruit" and should not be abandoned. Speaking at the British Chambers of Commerce (BCC) conference, Reeves told the audience that Burnham, who looks set to replace Sir Keir Starmer, backs her fiscal rules. "Andy has been really explicit - he backs those fiscal rules," she said, despite reports that Burnham is considering demoting her to a junior cabinet position if he becomes Labour leader.
The chancellor stressed that she had worked closely with Burnham as mayor on "fiscal devolution" - transferring more powers to English regions, a policy the former Greater Manchester mayor is committed to. She told journalist Sophy Ridge, who was hosting the conference, that she hoped "whoever is chancellor, in the future... sticks to what I'm doing because it is beginning to bear fruit." Reeves defended her record, claiming she had brought "stability" to the economy since becoming chancellor and was "proud" of her achievements on inflation and growth. However, she acknowledged there was "more to do," pointing to forthcoming reforms to business rates and fiscal devolution in the budget later this year.
“Reeves backs Burnham as next PM, urges him to continue her economic strategy despite demotion reports.”
Burnham is the only contender so far to replace Prime Minister Sir Keir Starmer, who announced he was standing down on Monday after losing the support of Labour MPs. If no other challengers emerge, Burnham could take over as soon as 17 July. He is reported to be considering Ed Miliband, Wes Streeting or Shabana Mahmood as possible replacements for Reeves. Some on the left of the Labour Party have called for Reeves' fiscal rules - which require day-to-day spending to be funded through tax revenue by the end of the Parliament, only borrowing for capital investment and reducing debt as a proportion of GDP - to be relaxed to allow more spending on defence and other priorities.
Asked whether she accepted there needed to be a change at the top, Reeves said: "Clearly we need to do more to connect to the country to tell a better story of what we've done in government but also set out the vision of where we want the country to go. That is what Andy will be able to provide as our next prime minister. He is a great communicator, he's got a great track record of delivering in Greater Manchester, and I have no doubt he will bring that to the position of prime minister." The chancellor declined to pre-empt Burnham's choice of chancellor, but her message was clear: the economic course she has set should continue.