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The UK has a new prime minister. Andy Burnham, the Labour MP for Makerfield, took over the reins from outgoing premier, Sir Keir Starmer, on Monday 20 July 2026.
In his first address to the nation outside No. 10 Downing Street, Burnham promised a “new economic model”.
Burnham has also vowed to deliver “the biggest change in our lifetimes to the way the country is run” and warned of making “difficult” decisions to the nation’s finances, which may include “having to ask for a little more” from taxpayers.
We take a deeper look at how Andy Burnham, the UK’s seventh political leader in a decade, could tackle the financial concerns uppermost in the eyes of the over-50s.
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One of Burnham’s first Cabinet decisions was to appoint former defence secretary, John Healey, as Chancellor of the Exchequer.
Within 12 hours of taking office, the newly reshuffled and self-styled “cost of living” government announced the temporary removal of VAT on electricity bills from 1 October, resulting in a saving of £45 per household.
The cut will apply in England, Scotland and Wales, but works slightly differently in Northern Ireland.
The following day, the government announced that single bus fares across England would be capped at £2 from January 2027. The decision is backed by £454 million in funding, which includes money for devolved governments to make similar moves.
Shortly before becoming prime minister, Burnham, whose father suffers from Alzheimer’s Disease, said “if there’s one area I’m going to expend quite a lot of political capital, it’s going to be on social care”.
The challenges facing Burnham when it comes to tackling social care are daunting and essentially revolve around money and how existing services - which can vary markedly depending on location - mesh with other institution such as the NHS.
In 2024/25 in England alone, the cost of adult social care stood at £34.5 billion. The devolved governments in Scotland, Wales and Northern Ireland are responsible for social care at their respective national levels.
The King’s Fund has suggested that the current social care system does not deliver on what people need, is bankrupting local councils, handicaps the NHS, and fails to pay staff adequately for what is a skilled job.
We’ve written elsewhere about why it’s important to plan for your care costs, how to do it, and who picks up the bill.
According to the Dr Jennifer Dixon of the Health Foundation: “Andy Burnham’s public position on social care reform has been consistent over the years: [to} create a care system with the same moral status as the NHS”.
Burnham believes in a publicly-funded “national care service”, a policy he proposed as health secretary in 2009, but was dropped by the following Conservative government.
When it comes to funding social care, there are various options at Burnham’s disposal. But whether any are especially palatable with voters is another point entirely.
One way to raise the dozens of billions of pounds required annually would be to meet more of the costs of social care through general taxation. Alternatively, local authorities could be allowed to raise council tax or business rates to spend more on social care in their area.
Another option would be to create an insurance-style system perhaps met from contributions made by both individuals and employers.
Nadra Ahmed CBE, executive co-chairman of the National Care Association, said: “Social care does not need fixing, it has continued to innovate and deliver despite years of financial pressure. What it needs is sustainable funding and recognition as a public service with parity of esteem alongside the NHS.”
Professor Vic Rayner, CEO of the National Care Forum, said: “Andy Burnham is absolutely right to prioritise social care… it will give rightful hope to the millions of people that draw on care and support, unpaid carers and those that provide who provide social care that we have a leader who sees and hears the pressures they have been facing every day.”
Andy Burnham has given his public backing to the pensions triple lock, saying he will stick to the promises made in the Labour Party’s 2024 election-winning manifesto about this state pension underpin.
The triple lock was introduced in 2010. It dictates that, each April, the state pension will rise by the highest of three measures: the inflation rate as measured the previous September, the rise in average earnings calculated from May to July the previous year, or 2.5%.
Since its creation, and thanks to periods of high inflation and soaring wages, the triple lock has become an expensive commitment which many within Whitehall would now either like to see modified or, ideally, scrapped.
In the 2025-26 tax year, state pension payments came to about £146 billion. In comparison, the UK spent just over £62 billion on defence in the 2024-25 tax year.
But the triple lock is popular with the public. Research from AJ Bell shows that nearly four-in-10 Brits (38%) would like to the see the triple lock made permanent, compared with just 6% who want it scrapped.
Tom Selby, director of public policy at AJ Bell, said: “A significant section of the public support the triple lock, particularly older voters, and any party indicating it will not pledge allegiance to the policy risks being annihilated at the general election.
“There are two main levers available to control costs: the amount people receive from the state in retirement, and the age at which they receive it.
“If you can’t pull the ‘amount’ lever, then the only option left is age, a shift that would only impact younger generations.”
Taxes in their various guises are the hottest political potato for Burnham and his government to handle.
At the time of writing, he had not published his tax policies and he is unlikely to announce any detailed plans before the next Budget which will likely take place later this autumn.
But previous comments made by Burnham suggest some clear priorities, each suggesting a greater emphasis on the taxation of wealth.
For example, in the past, Burnham has said that there was “definitely a case” to increase the additional rate of income tax to 50p, up from the current 45p rate.
But an income tax rise would fly in the face of a key Labour manifesto pledge not to raise taxes on “working people”, which also rules out increasing the rate of income tax, National Insurance and Value Added Tax.
The introduction of a so-called ‘wealth tax’ has also been mooted. The thinking behind this is to reduce wealth inequality with the aim of increasing government revenue.
In practical terms, it could be present itself as an annual charge on an individual’s total net assets, including property, cash, and investments, less their liabilities, such as loans and mortgages.
Burnham has also said he believes income is overtaxed and assets are undertaxed and has hinted at increasing capital gains tax (CGT) rates and introducing a land value tax.
No specific proposals have been announced, and CGT is not covered by the manifesto commitments. But raising CGT rates towards the level of income tax would be consistent with Burnham’s views are undertaxed.
Meanwhile, a tax on land values could be introduced as part of a broader package of property tax reform including council tax and stamp duty.
That said, major reform of property tax would be complicated needing, amongst other factors, valuations of the UK’s housing stock.
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