The government’s former cost-of-living tsar had warned Andy Burnham must stop acting like “Father Christmas”, telling the prime minister that British businesses aren’t a “piggy bank” to be raided.
Iceland boss Richard Walker served as Sir Keir Starmer’s expert ‘cost-of-living champion’ during his tenure, but left his post days before Mr Burrnham took office.
He told Mr Burnham that he needed to start making “unpopular decisions” ahead of next month’s Budget, warning the prime minister “real crunch time is coming up now”.
Lord Walker told LBC: “Andy Burnham has been Father Christmas so far, and it would be great if he’d start to get a bit more unpopular.
“For the last 50 years, chancellors on the left or the right haven’t been too dramatic on raising taxes or reducing spending because they’ve been able to borrow a little bit more.
“Borrowing, increasing borrowing, is now off the table as an option. The bond markets are teaching us that lesson. Therefore, tough choices are now needed.
“We cannot, for the sake of all of us, keep taxing business and view it as some piggy bank that can constantly be raided, because as I said, it’s only business that, that creates growth.
“Therefore, we have to now start reducing spending, or at least cutting the rate of increase of spending.”
He added: “The real crunch time is coming up now. You know, the nights are drawing in, it’s getting colder, and it’s time to make some hard choices.”
Mr Burnham has made a slew of promises since entering No 10 over the summer, including moves to introduce a £2 cap on bus fares, cut VAT on household electricity bills, and end rough sleeping. But questions have been raised on how he will fund his pledges.
On Wednesday, he admitted next month’s Budget will be “challenging” for his government after official figures revealed inflation has soared to a five-month high.
Chancellor John Healey is set to deliver the first Budget since Mr Burnham entered No 10 next month, amid concerns over the impact of Donald Trump’s war on Iran and funding for UK defence.
The major political headache comes against a backdrop of rising inflation rates, with the most recent official figures showing another jump on Wednesday.
The Bank of England governor Andrew Bailey warned interest rates could rise in the coming months if the Iran war continued.
Mr Burnham told broadcasters that the current climate would mean next month’s Budget will be “challenging”, but insisted his government “will not take risks with people’s living standards”.
“It is going to be challenging, because the picture around the world is challenging, particularly the situation in the Middle East, and we will look carefully at all those things,” he said.
