Andy Burnham, a Stone Roses fan, will know the band's song Fools Gold and the idiom's meaning: something that appears valuable but proves worthless. Since becoming Britain's 59th Prime Minister this week, he has announced a temporary VAT cut on household electricity bills from 5% to 0% and a £2 cap on most bus fares from January 1, 2027, with more cost-of-living measures promised later in the week.
Electricity VAT cut: a 'good totemic step' with limited impact
MoneySavingExpert.com founder Martin Lewis described the electricity bill cut as a "good totemic step" but warned that, in practice, most people won't feel much benefit. The cut applies only to electricity bills, meaning those with dual fuel bills for gas and electricity will see savings only on electricity use. Additionally, the energy price cap is set to rise in October and January, negating any savings. The funding partly comes from scrapping Sir Keir Starmer's £1.8 billion digital ID scheme, which was itself unfunded, so the money must come from elsewhere, inevitably reducing spending on other things.
Bus fare cap: a recycled policy
Burnham's bus cap will be welcomed by many, especially the elderly, those in areas with poor transport, and rural communities. However, the Conservatives originally introduced the £2 bus fare cap and pledged to keep it. Labour later hiked it to £3 – a 50% rise. So Burnham's move is not a new masterstroke but a restoration of a previous policy.
Is Burnham setting up for a snap election?
Burnham, a former Greater Manchester Mayor known for slick PR, may be laying the groundwork for a snap general election. He will never be more popular than now, and if he can maintain that popularity for a few more months, he might call an election, especially if Reform UK continues to falter over questions about Nigel Farage's financial dealings. Burnham has not presented a fully functioning plan yet: when announced as Labour leader, he said he had a plan; on Monday as PM, he said he would announce a 10-year plan later this year. A 10-year plan implies two terms, and the election alarm bells are ringing.
Potential pitfalls
Burnham's honeymoon period could be disrupted by Donald Trump's actions or by the British public, who may not be fooled if his commitments turn out to be Fools Gold.
