New British PM Burnham Targets Lower Energy Bills In First Move
British Prime Minister Andy Burnham said on Tuesday he would cut taxes on electricity bills, the first of several early moves to signal his intent to ease cost-of-living pressures and quell anger over successive governments’ failure to bring change.
On his second day in his new job, Burnham said his government would remove the value-added tax from domestic electricity bills from October 1, cutting around £45 from the average annual bill of around £1,862 ($2,490) that households pay.
With bond investors watching closely for how any fiscal support would be paid for, he said the move would be funded by savings from the cancellation of a £1.8 billion digital ID programme, announced on Sunday.
“We’re taking immediate action to cut taxes on energy bills, put more money in people’s pockets and bring back hope,” he said in a statement, having pledged to give people more “breathing space” in their lives.
Burnham, a 56-year-old former Greater Manchester mayor, wants to move quickly to show people he is “serious about helping them out”.
He said on Monday his early policies might not “take all of the pressure off” people struggling with rising prices and that a longer-term plan would be set out later in the year.
At his first cabinet meeting of top ministers, Burnham again stressed that fiscal discipline was the touchstone for his new government as was a push to make life more affordable.
“(It’s) a second chance at a first impression,” he told his ministers, according to his spokesperson.
Healey, who quit as defence minister under Starmer in protest at the lack of funding for the sector, reinforced the message about fiscal discipline and warned his cabinet colleagues they would have to look hard at their budgets.
Both Burnham and Healey acknowledged the move on electricity bills might not remove cost-of-living pressures, but the finance minister said it “does indicate that we’re offering a bit of help”.
REUTERS
