Andy Burnham is about to be hit with the biggest challenges of his career. Devoted to football, he might find himself unable to concentrate on the World Cup final. The next day, he could face the worst Monday morning blues of his life. Thrilled to move into Downing Street as prime minister – an experience yet to be obtained by the likes of the Miliband brothers and fellow New Labour apparatchiks – he may wonder why he worked so hard to oust Sir Keir Starmer when civil servants brief him on the dangers facing the country.
Economic warnings from civil servants
Bloomberg reports: “Burnham will be warned by senior civil servants that he faces a worsening economy and rising interest rates in his first six months in power, as well as a potential oil price shock if the Iran war drags on.” Inflation forecasts have been revised upwards, and the price of oil could reach $150 a barrel over the conflict between Iran and the US. The weekly shop could get even more expensive, and paying the mortgage may become an even more terrifying challenge on Mr Burnham’s watch.
Political pressures and cabinet uncertainty
The prospect of even higher borrowing costs will trigger calls from the Conservatives and Reform for him to cut Britain’s benefits bill – a surefire way to split the Labour Party. His chancellor’s top priority will be ensuring that Britain’s finances are sound. However, days away from the Burnham premiership beginning, he has still not made his top cabinet picks. Unless he keeps Rachel Reeves in post, he will have a chancellor scrambling to get up to speed with the true state of the national finances, with no chance to come up with a long-term plan.
Lessons from the Starmer administration
This is a dangerous time. Civil servants will have a raft of ideas for how spending can be rationalised, but what is presented as commonsense reform can lead to political disaster. Consider Ms Reeves’s early decisions amid panic about a “black hole” in the finances – the end of universal winter fuel payments for pensioners, inheritance tax raids on farming families, and the hike in National Insurance payments. Economists can argue about the necessity of such measures, but the Starmer administration was blamed for crushing growth, killing confidence, and causing panic among older generations. Labour’s honeymoon was wrecked, and MPs soon resolved Sir Keir could not lead them into the next election.
Burnham’s challenge: a plan to avoid ruin
If Mr Burnham wants to avoid a similar disaster, he and his chancellor need a plan that reassures Britons that the country is not sliding towards ruin. He is like a football manager facing the biggest test of his career, and he has yet to pick his team.
