Andy Burnham’s big ambitions come with a big price tag. Our analysis shows a £22bn black hole of unfunded commitments, including the costs of honouring decisions announced in the dying days of Keir Starmer’s government, such as NHS pay rises and the Defence Investment Plan. If you add in the
Christian May
Thursday 23 July 2026 5:13 am | Updated: Wednesday 22 July 2026 4:23 pm
Andy Burnham’s big ambitions come with a big price tag. Our analysis shows a £22bn black hole of unfunded commitments, including the costs of honouring decisions announced in the dying days of Keir Starmer’s government, such as NHS pay rises and the Defence Investment Plan. If you add in the new PM’s other great ideas, such as a massive bump in the foreign aid budget, the figure rises north of £60bn.
We’re told this will be a “cost of living” government, with an emphasis on giving people a bit of breathing room. So far we’ve had £45 knocked off the average household electricity bill and a the restoration of the £2 bus fare cap. Even these frankly insignificant gestures cost money. The energy bill subsidy was supposed to be funded by scrapping the Digital ID scheme, but since that was unfunded the cash will have to come from somewhere else.
The bus fare cap will cost £500m a year, with the Department for Energy and Net Zero being raided in what the new chancellor John Healey calls “reprioritising.” He also insisted that the two new policies show how the government will “build a new economy, create new hope, and advance working people across the country”. One bus ride at a time, I suppose.
‘Cost of doing business crisis’
Meanwhile, it’s been left to industry groups to point out that there is also a “cost of doing business crisis” in this country, with taxes, costs and red tape having piled up over the last two years. Yesterday, Burnham’s business secretary Jonathan Reynolds held a series of calls with bosses from a range of sectors, making the case that their interest will be “at the heart of Andy Burnham’s agenda” and telling them “we must enhance the positive business environment we all need.”
Will this be mere warm words, or will the new government have the confidence to unpick some of the most damaging attacks on the private sector unleashed by the last lot? John Healey may be a sensible man but I’m not at all confident that Burnham and his new team of ministers and advisors – some of whom are from the alarmingly far left of the Labour party – will be inclined to do anything of the sort. The mood music is currently more about bank levies and windfall taxes.
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From crippling energy prices to employment taxes, Britain’s private sector looks set to have to battle on, into the wind, once again.
Read more Manchester was Burnham’s rehearsal – now get ready to pay the bill
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