Burnham Faces Kemi Badenoch at First PMQs as PM

Andy Burnham faced Kemi Badenoch at his first Prime Minister’s Questions as prime minister on 2 September, when MPs returned from the summer recess. With the 28 October Budget approaching, Burnham did not rule out tax rises. Badenoch questioned how his commitments would be funded.

Budget pressure and fiscal rules

Burnham said he would not set out the Budget from the dispatch box, leaving the eventual tax and spending decisions unresolved. Birmingham Live reported an estimate that fiscal tightening of up to £14 billion ($18.9 billion) could be required.

“I’m not going to do what any prime minister has done and write the Budget here.”

Burnham said his fiscal rules allowed no borrowing for day-to-day spending and required debt to fall as a share of GDP by the end of the Parliament. He said the government would follow those rules, citing the fastest G7 growth in the first half of the year and recorded borrowing at a six-year low.

The borrowing-cost measure is distinct from Burnham’s claim about recorded borrowing: one concerns the cost of long-term government borrowing, while the other concerns the recorded borrowing level.

Badenoch accused Burnham of being a spendthrift people-pleaser who had not explained how his promises would be funded. She argued that every new commitment would have to be paid for through taxes, borrowing or spending reductions.

Burnham set out policy commitments with different timetables, including removing VAT from electricity bills and cutting business rates:

• Remove VAT from electricity bills to help with household living costs.
• Cut business rates for pubs, social clubs and live-music venues.
• Increase support for people in their twenties who are outside education, employment and training, as part of his commitment to reduce welfare spending.
• Reopen North Devon’s maternity unit, though not within days.
• Bring forward a Commonhold and Leasehold Bill during the current parliamentary session.

Burnham said greater support for young people would shift spending from paying for failure to investing in success. PIP, which is paid to more than four million people, is under review and the review is due to report to the government in November. Birmingham Live reported that any resulting cuts could be postponed until 2027. The commitments were intentions rather than settled Budget decisions.

Market pressure

Burnham argued that market turbulence and high debt exposure reflected the legacy of Conservative governments after 14 years of stagnant growth and rising debt relative to GDP. He said his government was restoring fiscal responsibility.

Jim O’Neill said Burnham needed a sensible fiscal strategy and a more realistic approach to welfare and pensions. He said mortgage rates could rise if the uncertainty continued. Sir Howard Davies said the government needed to signal its overall fiscal approach and that it could not retain the pension triple lock indefinitely. He warned that inaction could damage credibility. Chris Beauchamp said Burnham’s reform ambitions were colliding with high debt and rising borrowing costs, leaving the UK exposed to bond-market pressure.

The Evening Standard forecast that a large Budget spending increase could deepen the sell-off and that market movements threatened a £6 billion ($8.11 billion) deterioration in the Budget position. O’Neill and Davies warned that financial uncertainty could persist before the Budget unless the government clarified its approach to fiscal balance.

Burnham said he had committed to spending 3% of GDP on defence by 2030, followed by a longer-term target of 3.5% by 2035. James Smith of the Resolution Foundation argued that, because the benefits would be widely shared, any tax rises for increased defence spending should include middle earners.

Economic model and wider commitments

Burnham argued that the centralisation of political power, privatisation of economic power and deindustrialisation since the 1980s had weakened Britain. He said austerity and Brexit compounded low growth and stalled regeneration.

Badenoch rejected that account, accusing Burnham of trying to reverse Thatcher-era reforms. She argued that Labour’s £70 billion ($94.7 billion) of tax rises had damaged the economy and would take Britain backwards.

Burnham said his government would seek greater public control over utilities including water and energy.

Burnham said he wanted a closer relationship with the EU but did not commit to single-market membership. He warned that a Made in Europe agenda could create serious problems for British steel and farming. Ed Davey, by contrast, argued for single-market membership and a new European deal to counter low growth and reduce costs for households, businesses and government.

Burnham also said he planned a public-facing follow-up to PMQs, called People’s Major Questions, to answer questions from the public as well as MPs.

Selected commentary included a mixed assessment from a Scotsman columnist, who said Burnham’s statement lacked substance, relied too heavily on familiar subjects and jargon, and was delivered nervously and stiffly. The columnist nevertheless said he performed better than Keir Starmer in one respect because he addressed Badenoch’s arguments directly, point by point. Quentin Letts called the debut underwhelming, drab and confusing, arguing that Burnham’s triple-helix language left MPs puzzled.

The next milestones are the 28 October Budget and the PIP review report in November. The Budget is expected to make the unresolved tax and spending choices clearer, while borrowing costs and market uncertainty remain part of the pressure before it.