Burnham cuts VAT on electricity bills in first major policy announcement
Andy Burnham has announced a fresh tax cut to remove VAT from domestic electricity bills beginning 1 October, the first in a series of anticipated policy announcements on Tuesday morning, reports BritPanorama.
Chancellor John Healey stated that the cut would be funded by cancelling the Digital ID programme. “For too long, too many people have struggled with the cost of living,” he declared. “Today’s energy tax cut will give families some breathing room on bills, and provide some reassurance this winter.”
Mr Burnham was still appointing his cabinet late into Monday night, with Angela Rayner returning as housing secretary, Healey named as chancellor, and Wes Streeting appointed as defence secretary.
Ed Miliband secured the role of foreign secretary, while Shabana Mahmood continues as home secretary. Louise Haigh, who led Mr Burnham’s Makerfield campaign, has been rewarded with a position as first secretary of state and chancellor of the Duchy of Lancaster.
Chancellor Rachel Reeves, deputy prime minister David Lammy, and housing secretary Steve Reed—all allies of Sir Keir Starmer—were dismissed by the former mayor of Greater Manchester and have returned to the backbenches.
Questions have arisen concerning the funding mechanism for the VAT cut. Former chief secretary to the prime minister Darren Jones highlighted that the Digital ID project was unfunded, stating, “Good news that VAT will be cut on electricity bills… But the Digital ID program was unfunded. The government will have to set out how it will pay for its new policies at the budget.”
The government expressed a commitment to reforming education to assist young people in entering the workforce. A spokesperson noted, “The reality is too many young people are still locked out of work. For too long, governments have paid for failure rather than invested in people’s success.”
In other developments, Burnham extended an invitation to US President Donald Trump for the G20 Summit in Manchester next year, following their first conversation shortly after he took office.
The early moves by the new prime minister indicate a focus on immediate economic relief, shaped by the pressing realities of living costs faced by households across the UK. These decisions may lay the groundwork for Burnham’s broader vision for governance amid challenging economic conditions.
