Andy Burnham, the frontrunner to succeed Sir Keir Starmer as Prime Minister following his recent Makerfield by-election victory, has indicated he will avoid making “significant” cuts to the Department for Work and Pensions (DWP) budget. Instead, Burnham has expressed opposition to “crude cuts” in welfare spending, emphasizing the need for broader reforms.
Speaking to The i Paper, Burnham highlighted his preference for reducing the welfare bill by focusing on “rethinking the education system” and helping young people transition into employment, rather than implementing direct budget slashes.
However, economists remain skeptical about the immediate impact of Burnham’s approach. Jonathan Cribb, deputy director of the Institute for Fiscal Studies (IFS), questioned whether such policies would persuade the Office for Budget Responsibility (OBR) that meaningful savings are achievable in the short term. Cribb suggested that the OBR would be more confident if spending controls targeted core financial entitlements, rather than incremental changes.
READ MORE: Black Country Pub Faces Possible Demolition for New Shop Despite Council Rejection
READ MORE: DVSA Takes Action as Drivers Face Six-Month Delays in Obtaining Licences
Supporting this view, Will Prescott, head of research at the think-tank Bright Blue, argued that to reduce the welfare bill effectively, Burnham must address major expenses like the state pension instead of minor adjustments.
As Burnham prepares to return to Parliament and potentially challenge Starmer’s leadership, he has enlisted the advice of three economic experts: Andy Haldane, former Bank of England chief economist; Richard Hughes, a former chair of the OBR; and Jim O’Neill. This move aims to strengthen Burnham’s credibility with financial markets, especially after criticism over his previous comments claiming the government was “in hock” to bond markets.
Following his Makerfield win, Burnham called for “change” within the party, emphasizing that there would be “no second chance.” Yet, his leadership ambitions have been met with criticism from rivals such as former Health Secretary Wes Streeting, who recently cautioned against what he described as costly and popular pledges that might prioritize party appeal over practical governance. Streeting warned, “There is a risk that a Labour leadership contest becomes a Dutch auction of the most expensive and popular pledges to appeal to the party faithful at the expense of the British people – not on my watch.”