New Prime Minister Andy Burnham has announced his first policy since taking office: a VAT cut on domestic electricity bills. The move, effective from October 1, is intended to provide immediate relief to households struggling with the cost-of-living crisis.
VAT Removal on Electricity
Speaking on Tuesday morning, Burnham confirmed that VAT will be removed from domestic electricity bills. The cut is funded by cancelling the Digital ID programme. Chancellor John Healey stated: “For too long, too many people have struggled with the cost of living. Today’s energy tax cut will give families some breathing room on bills, and provide some reassurance this winter.”
First Speech and Promises
Burnham officially became Prime Minister on Monday afternoon after ‘kissing hands’ with the King, succeeding Sir Keir Starmer. In his first speech outside Number 10, he promised to win over voters ‘fed up with politics’ and to show the world that the UK can be a source of stability. He also pledged a ten-year plan later this year, with immediate measures to address the cost-of-living squeeze and give people “breathing space now”.
Cabinet Reshuffle
On Monday, Burnham announced his new Cabinet, with John Healey appointed as Chancellor. Four Greater Manchester MPs also joined the new government. The reshuffle marked a significant change in leadership.
Cost-of-Living Focus
In the Downing Street garden after his appointment, Burnham was asked about priorities including bus fares, energy bills, and rent freezes. He said: “We’re looking at all of those things… We just want to do some things that people will feel and feel quite quickly. It won’t solve everything, but it just shows a direction of travel and that we’re serious about helping them out.”
The VAT cut is expected to reduce inflation while supporting households across every postcode, according to Chancellor Healey.
