Andy Burnham, the newly elected MP for Makerfield and widely tipped as a future Labour leader, has declared he will not implement "significant" Department for Work and Pensions (DWP) benefit cuts if he becomes Prime Minister. In an interview with The i Paper, Burnham stated his opposition to "crude cuts" and argued that welfare spending should be reduced by "rethinking the education system" and helping young people into employment rather than slashing benefits.
Economists Question Burnham's Approach
Jonathan Cribb, deputy director at the Institute for Fiscal Studies (IFS), cast doubt on whether Burnham's proposed measures would convince the Office for Budget Responsibility (OBR) that "significant savings" could be achieved in the short term. Cribb noted that the public finances watchdog would be "much more confident" if expenditure were controlled by changes to "actual financial entitlements" rather than alterations "around the edges."
Will Prescott, head of research at the think-tank Bright Blue, echoed this skepticism, urging Burnham to examine "big ticket items" such as the state pension if he wishes to reduce welfare expenditure, rather than "tinkering around the edges."
Economic Advisers to Bolster Credibility
Burnham has recruited three economic heavyweights to advise him as he seeks to reassure markets ahead of a potential leadership challenge. The former Manchester mayor is receiving guidance from Andy Haldane, former Bank of England chief economist; Richard Hughes, former chair of the OBR; and Jim O'Neill. This move follows criticism after Burnham suggested the government was "in hock" to bond markets.
After his by-election victory, Burnham declared there would be "no second chance" for the Labour Party and urged for "change." However, rival Wes Streeting, the former Health Secretary, challenged Burnham's economic policymaking in a speech this week, implying that Burnham had failed to produce credible policy commitments. "There is a risk that a Labour leadership contest becomes a Dutch auction of the most expensive and popular pledges to appeal to the party faithful at the expense of the British people – not on my watch," Streeting said.
