Andy Burnham cuts VAT on electricity and appoints cabinet on first day
On his first full day as Prime Minister, Andy Burnham announced a VAT cut on electricity bills and appointed his new cabinet.
The Full Story
A plain summary built from the channels that reported this story.
Andy Burnham has marked his first full day as Prime Minister with a major reshuffle of his cabinet and a promise to ease the cost of living. His first policy announcement was a cut to VAT on household electricity bills, but the move was quickly overshadowed by a row over how it would be paid for.
VAT cut on electricity
From October, VAT on domestic electricity bills will be removed, saving the average household around £45 a year. The government said the £850 million cost would be covered by scrapping the previous administration's plan for digital ID cards. However, Darren Jones, who was sacked as Chief Secretary to the Treasury in the reshuffle, immediately posted on social media that the digital ID programme was itself unfunded. The Office for Budget Responsibility had previously noted that no specific savings had been identified for the ID scheme. The new Business Secretary, Jonathan Reynolds, insisted the switch-spend was legitimate, saying the money for the current financial year was available.
Cabinet overhaul
Mr Burnham swept away half of Sir Keir Starmer's top team, replacing or moving 11 ministers. The most surprising appointment was John Healey as Chancellor. He had resigned as Defence Secretary just weeks ago over a row about military funding. Ed Miliband, the former Labour leader, became Foreign Secretary. Wes Streeting, who had been a potential leadership rival, was given Defence. Shabana Mahmood stayed on as Home Secretary. Angela Rayner returned to her old job as Housing Secretary after being forced out of the previous cabinet over a tax dispute. Lucy Powell, the deputy Labour leader, became Education Secretary. Yvette Cooper was moved from Foreign Secretary to Health. Louise Haigh, one of Mr Burnham's closest allies, was made First Secretary of State, effectively deputy prime minister.
Cost of living focus
At his first cabinet meeting, Mr Burnham told ministers: "We need to be a cost of living government." He said the government would always show how policies were paid for. Later in the week, he announced a £2 cap on bus fares in England from January, funded by the Department for Energy and Net Zero. The new Chancellor, John Healey, said fiscal discipline was his first duty.
Reaction and criticism
The Conservative leader, Kemi Badenoch, welcomed the energy bill cut but questioned how it would be funded without tax rises or more borrowing. Reform UK called for a general election, saying Mr Burnham had no mandate. The Liberal Democrats offered to work with the government on social care. Within Labour, the sacking of Starmer loyalists created some unease, but most MPs publicly backed the new leader.
Other developments
Mr Burnham also spoke to US President Donald Trump, who praised reports that the new PM would support more North Sea oil drilling. The government later clarified that no new licences would be issued, but existing fields could be developed faster. The new Prime Minister also announced plans for a "Number 10 North" in Manchester, with civil servants already working there.
On screen
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Key Claims
Claims reported during this story's coverage, mapped by channel. Ordered by how many channels carried each claim.
| Claim | Channel 5 | BBC NEWS | BBC One | BBC Two | Channel 4 | GB News | ITV | Sky News |
|---|---|---|---|---|---|---|---|---|
| Andy Burnham announced a VAT cut on household electricity bills, saving a typical household around £45 per year. | · | |||||||
| The Office for Budget Responsibility suggested the VAT cut is not fully funded because the digital ID savings were not real money. | · | |||||||
| Ed Miliband was appointed Foreign Secretary. | · | · | ||||||
| Wes Streeting became Defence Secretary, replacing Dan Jarvis. | · | · | · | |||||
| Burnham will announce plans for more North Sea oil and gas drilling in his first speech as PM. | · | · | · | · | ||||
| Darren Jones stated that the digital ID programme was unfunded. | · | · | · | · | ||||
| Labour's deputy leader said the manifesto policy of no new licences remains, but Burnham is talking about a change of emphasis. | · | · | · | · | ||||
| The government said the VAT cut would be funded by scrapping the digital ID scheme. | · | · | · | · | ||||
| Andy Burnham is expected to announce policies on taking energy and water companies under public control and a council house building programme. | · | · | · | · | · | |||
| Andy Burnham will scrap the government's plan to introduce digital ID cards. | · | · | · | · | · | |||
| Donald Trump misinterpreted Burnham's policy, claiming he will fully open up North Sea oil. | · | · | · | · | · | |||
| John Healey, Ed Miliband, and Shabana Mahmood were among the first to enter Number 10 for cabinet appointments. | · | · | · | · | · |
Channel Perspectives
What each channel focused on, with key quotes.
BBC ONE West provided extensive, rolling coverage of the day's events, focusing on the cabinet reshuffle and the funding row. It gave significant airtime to the sacked minister Darren Jones's criticism and included vox pops from the public. The tone was factual and balanced, with correspondents explaining the political and economic implications.
- “After sweeping away half of Sir Keir Starmer's top team, Andy Burnham is this lunchtime meeting his cabinet for the first time.”
- “Darren Jones, who was until yesterday Keir Starmer's right-hand man, welcomed the news but said the digital ID programme was unfunded, adding the government will have to set out how it will pay for its new policies at the budget.”
Channel 4 focused on the political drama and the internal Labour divisions, framing the funding row as a sign of early trouble. It also gave prominence to the oil and gas drilling debate and the fracking loophole story. The tone was more analytical and slightly sceptical, with correspondents questioning the substance of the announcements.
- “This was the big announcement that Andy Burnham had and it's already fallen apart on arrival. He doesn't seem to be ready.”
- “If you were looking for real help for people with their energy bills, particularly their heating bills, is this how you'd do it? Not really.”
BBC News provided a concise, straight news summary of the day's events, focusing on the VAT cut, cabinet appointments, and the funding row. It also covered the Prime Minister's phone calls with world leaders and the opening of Number 10 North. The tone was neutral and informative, with correspondents explaining the policy details and political context.
- “The new Prime Minister Andy Burnham announces VAT will be cut from electricity bills. It's his first announcement on the cost of living.”
- “Fiscal control is the first duty of any Chancellor. It is mine.”
ITV1 emphasised the political infighting and the question of how the VAT cut would be funded. It gave significant coverage to the sacked minister Darren Jones's criticism and included analysis from political editor Robert Peston. The tone was slightly more critical, highlighting the contrast between Burnham's promise of unity and the immediate backbench rebellion.
- “If Darren Jones says there's no money for it Andy Burnham has got to go back to the drawing board.”
- “It was supposed to be so different. The new Andy Burnham government was meant to be a circuit breaker from the past.”
GB News adopted a highly critical and combative tone, describing the reshuffle as a 'bloodbath' and questioning the new Prime Minister's mandate. It focused on the sacking of Starmer loyalists, the lack of scrutiny, and what it called a 'calamity cabinet'. The coverage was opinionated and framed the events as a negative development for the country.
- “The Messiah, without a mandate, Andy Burnham, walked along Downing Street and entered Number 10, still without an ounce, though, of scrutiny.”
- “A bloodbath so far. A bloodbath. Ten of them have gone out. Four of them have come in thus far.”
Sky News provided a balanced, detailed account of the day's events, focusing on the cost of living announcements and the cabinet appointments. It included analysis from correspondents and reaction from opposition parties. The tone was factual and explanatory, with a particular focus on the economic implications and the funding questions.
- “The first major policy announcement from the new PM Andy Burnham to remove VAT on electricity to ease the cost of living.”
- “Fiscal control is the first duty of any chancellor. It is mine.”
5 News provided a straightforward summary of the day's events, including the VAT cut, the cabinet reshuffle, and the funding row. It included vox pops from the public and a segment on the bus fare cap. The tone was neutral and accessible, aimed at a general audience.
- “The first major policy announcement then, how's it gone down in Westminster?”
- “This was the big announcement that Andy Burnham had and it's already fallen apart on arrival.”
BBC Two's Newsnight provided an in-depth analysis of the economic challenges facing the new government, focusing on the funding of the VAT cut and other spending pledges. It included a panel discussion with Jeremy Corbyn and other commentators, and a detailed breakdown of the costs of potential future policies like defence and social care. The tone was analytical and questioning.
- “The bottom line is that you cannot pay for a tax cut by scrapping a spending plan, which was already not paid for.”
- “We need to be a cost of living government and give people a sense that help is coming.”
Broadcast Timeline
News broadcasts tracked for this story, in time order.