Andy Burnham is taking advice from Sue Gray on how to deal with a number of immediate political problems that will need solving in his first few weeks. Gray, who previously compiled what one Labour official called her 'shit list' for Keir Starmer in 2024, is now advising Starmer's successor in an unofficial capacity.
1. Easing the cost of living
Burnham has said the government needs to be 'serious about putting more money back in people's pockets'. His policy adviser, Miatta Fahnbulleh, says the prime minister will be focused on 'dealing with the cost of living in the short term'. Ideas floating around Burnham's team include introducing a year-long rent freeze for the private sector, a reduced cap on bus fares, and removing green levies from energy bills and funding them through tax instead. While some in his team urge funding commitments by taxing wealth, Burnham signalled earlier this week this would not be pursued in the immediate term.
2. Funding defence
Starmer has left Burnham with a £4.7bn black hole in defence investment plans. Downing Street and Treasury officials suggest funding this through increased borrowing, given headroom against debt targets. However, Burnham will see headroom depleted by inflation triggered by the Iran war, and also needs money for cost of living measures and possible de-privatisation of utilities.
3. What to do with Thames Water
Creditors to the stricken water company are trying to negotiate a £10bn rescue package. Emma Reynolds, the environment secretary under Starmer, recently wrote to regulators spelling out opposition to such a deal, saying it would represent poor value for taxpayers. Burnham will have to decide whether to ask the high court to put the company into special administration, a first step towards public control.
4. Political funding
Shortly before recess, the government postponed the next stage of the elections bill to pass the Hillsborough law instead. This put several internal policy disputes into Burnham's hands. Labour MPs have proposed amendments including a donations cap, a ban on cryptocurrency donations, and a commission on electoral reform. Burnham has talked about doing politics differently – this will be an immediate test of his ambition.
5. The EU reset
The UK and EU were due to hold a joint summit to confirm the long-running 'reset' in relations, including new deals on agriculture, energy trading, and increased visas for young people. A sticking point was Brussels wanting the UK to offer European students the same fees as domestic ones, costing the sector or government over £100m. Once EU officials realised Starmer was on his way out, they postponed the summit to talk to Burnham, leaving him to decide on contentious issues like fees.
6. The US-UK relationship
Starmer put great stock in staying close to US President Donald Trump. The Iran war, which the prime minister publicly criticised, caused a serious rift. It will be up to Burnham to decide whether to heal the relationship or seek distance from the volatile US administration, as many of his own MPs advise.
