Andy Burnham latest: New PM cuts VAT on electricity bills in first major policy announcement

Responding to unemployment and borrowing statistics published by the ONS today, which show unemployment has risen and public borrowing at £16bn, Liberal Democrat Treasury Spokesperson Daisy Cooper MP said: “The new Chancellor needs to turn things around, and fast. The economy is stuck in the slow lane while job seekers and families pay the price.

“Healey now needs to urgently tackle unemployment, by scrapping Rachel Reeves’ unfair jobs tax that is stifling businesses and slamming the door shut on job opportunities.

“Today’s borrowing figures also show the huge pressure on our public finances. The only real answer is to boost growth, and protect our economy from the global shocks it faces, like Trump’s illegal Iran war. That’s why Andy Burnham must immediately begin negotiations for a new growth defence partnership with the EU, including joining the Single Market.”

UK Government borrowing fell to £16 billion last month, below what forecasters were expecting thanks to lower inflation-linked debt interest costs, according to official figures.

It means June’s public sector net borrowing figure was £7.9 billion, or 33.1%, less than the same month in 2025, the Office for National Statistics (ONS) said.

It was also £300 million below the Office for Budget Responsibility’s (OBR) forecast, and £2 billion less than what most economists had been expecting.

Borrowing between April and June was 1.9% of the UK’s gross domestic product (GDP), representing the 10th highest period since comparable records began in 1993.

Andy Burnham is expected to meet with Donald Trump in Manchester next year for the G20 Summit, it has emerged, after the pair spoke for the first time just minutes after the new prime minister entered No 10.

Mr Burnham reportedly extended the invite to the US president in one of his first calls since entering Downing Street.

While White House sources offered no details of the phone call, new oil and gas drilling in the North Sea is understood to also have been discussed.

Chancellor John Healey said the cut to VAT on electricity would be funded from cancelling the Digital ID programme.

“For too long, too many people have struggled with the cost of living,” he said.

“Today’s energy tax cut will give families some breathing room on bills, and provide some reassurance this winter.

“This measure is funded this year from cancelling the Digital ID programme, and it will help bring down inflation while supporting households in every postcode.”

Chancellor John Healey said the cut would be funded from cancelling the Digital ID programme.

“For too long, too many people have struggled with the cost of living,” he said. “Today’s energy tax cut will give families some breathing room on bills, and provide some reassurance this winter.”

The new premier promised to provide early relief for households struggling with the cost of living as he stood on the steps of No 10 on Monday, pledging to set out the details today.

Andrew Burnham – who took over as prime minister promising a “circuit breaker” for British politics – has started in post with a bang. The new PM conducted a brutal purge of Starmer loyalists, sacking more than nine ministers who had close ties with his predecessor. David Lammy, Darren Jones, Rachel Reeves and Peter Kyle all left the government, while others – including John Healey – had shock promotions.

Here, The Independent looks at the key winners and losers of today’s brutal reshuffle so far.