𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Andy Burnham is not hanging around. Since entering No 10 less than a fortnight ago he has made a blitz of announcements – all revealed in the form of slick social media videos seemingly designed to remind voters how much more affable and authentic our new Prime Minister is compared to the last one.

The cost of these announcements is racking up – the abolition of VAT on electricity bills will cost £850million, bringing back the £2 bus fare cap will be more than £500million, ending rough sleeping comes in at £340million, while the 20% reduction in business rates for pubs and clubs is another £100million. And all this excludes the huge costs of the proposed National Care Service, more council house building and increasing defence spending to 3.5% of GDP by 2035.

Whether you think the ideas good or bad – and I would say it’s a mixed bag – the problem is announcing new policies is the easy bit. Deciding where the money is going to come from is where the difficulty lies. And so far Burnham has largely dodged that question. We will have to wait until the Budget in the autumn to get the full picture of how he is going to balance the books. But we already have some clues – to fund the massively costly reforms to social care that Burnham is exploring, Whitehall officials have worked up plans for a new 1.8% income tax.

Something has to give. State spending is spiralling out of control. In the month of June alone, interest payments on government debt were £11.8billion – that is £16.4million every hour. There are more than one million 16–24-year-olds across Britain who are ‘NEETs’ – Not in Education, Employment or Training. One in four of the population now claim to be disabled with the number of working-age people claiming disability benefits having skyrocketed since the pandemic – from 2.8 million to almost four million. Reversing this is what Burnham needs to be talking about if he wants to reassure the financial markets that the UK is not an international basket case that is heading towards a debt crisis.

And yet Burnham’s plans to tackle young unemployment involve even more benefits – to the tune of £4,500 a year – which will be given to parents on Universal Credit if their children become apprentices. The new PM has rejected ‘crude’ cuts to disability benefits or specific reductions in PIP entitlement, despite the fact mental health is now the largest category of claims and more than half a million people now receive the payments for anxiety.

Amid all this, Burnham supports bringing foreign aid spending back up to 0.7% of GDP, which would cost £14billion more a year. It feels our generosity is being abused when recipients like Pakistan – a nuclear power with its own space programme – is unwilling in return for our aid to take back its own people like the Rochdale grooming gang ringleader Shabir Ahmed who we are currently trying and failing to deport.

“To govern is to choose,” as the saying goes. Burnham is giving off the strong impression of being a people-pleaser, a man who likes being liked a little too much. As PM you must be willing to make difficult choices – and, unlike in his previous gig as Manchester mayor, he now has responsibility for not just spending money but raising it too. He should not be taking even more from working people when the tax burden is already at its highest level in more than 70 years.

And while it is tempting to squeeze the rich, the reality is there are fewer and fewer to target. We learnt this week the total number of millionaires in the UK has fallen to its lowest level since the 2008 financial crisis, with 442,000 millionaires here in 2025, down from more than one million in 2021. The rich are simply leaving, taking their potential tax revenues with them.

Burnham cannot afford to keep on spending like a drunken sailor without deciding where the money is going to come from. And that will require him to stop trying to be friends with everyone and instead get tough with those who continue to believe in a magic money tree.

Ameer Kotecha is CEO of the Centre for Government Reform. He was formerly a senior diplomat, serving as the head of the British consulate in Russia 2023-25