Andy Burnham promises more help for struggling households at first Cabinet meeting

Andy Burnham has pledged to lead a "cost-of-living government," as his Cabinet met in Downing Street for the first time since the Makerfield MP swept to power as Prime Minister.

The new premier promised to provide early “breathing space” for households struggling with the cost of living as he stood on the steps of No 10, pledging to set out details on Tuesday.

Addressing his Cabinet, the new Prime Minister told his top team: “What can we do just to take that little bit of pressure off people’s shoulders, just to give them that little extra sense that help is coming so that they can have that bit of hope that things are getting better.

“And that’s the mission that we’ve got to set ourselves together.”

He asked his colleagues to look into what their department could do to ease cost-of-living pressures, “big and small”.

“We need to be a cost-of-living Government, getting that cost of living down, looking at all possible ways of doing that.”

Mr Burnham sat opposite his new Chancellor John Healey, and was flanked by Cabinet Secretary Dame Antonia Romeo and Education Secretary Lucy Powell.

Burnham also vowed to always “show how we’re going to pay” for policies.

It comes after the PM unveiled his first major policy announcement – an £850 million tax cut on electricity bills – a measure that triggered backlash from one ousted Starmer ally who branded the cut “unfunded”.

The Prime Minister, whose first pledge outside Number 10 was to end rough sleeping, told struggling families "help is coming”.

From October 1 electricity bills will be VAT free, saving households around £45-a-year as part of the new Prime Minister’s promise to help ease cost-of-living pressures.

On Monday, Business Secretary Jonathan Reynolds has told LBC a newly announced cut to electricity bills is a "statement of priorities" - despite Labour MP Darren Jones insisting the move was "unfunded".

But Darren Jones, former chief secretary to the prime minister, has said the digital ID project was unfunded and questioned how the VAT cut would be paid for. He wrote on X: “Good news that VAT will be cut on electricity bills.

“It’s a simple way for families to save a few quid, and to mechanically help to keep inflation that little bit lower.

In his first address to the nation as Prime Minister, Mr Burnham pledged the biggest change to British politics in 40 years, and said he would deliver “a new political model and a new economic model” for Britain.

On Monday evening, he made widespread changes to the Cabinet, starting with the appointment of John Healey as the new Chancellor to succeed Rachel Reeves.

A swathe of major figures from Sir Keir Starmer’s era joined Ms Reeves in leaving Government, including ex-deputy prime minister David Lammy, former attorney general Lord Hermer and former housing secretary Steve Reed.

Their replacements in senior Government roles were announced throughout Monday evening and will join Mr Burnham around the Downing Street Cabinet Room table on Tuesday.

Louise Haigh, a key ally of Mr Burnham who was instrumental in getting him into No 10, was made First Secretary of State and Chancellor of the Duchy of Lancaster, giving her a role as a fixer across government.

Ed Miliband was appointed Foreign Secretary, and Shabana Mahmood remains as Home Secretary, while Wes Streeting became the new Defence Secretary, and Angela Rayner returned to Government as Housing Secretary.

Once the dust had settled, it became clear that Mr Burnham had chosen not to appoint a new deputy prime minister, a post previously held by Ms Rayner and Mr Lammy.

The Department for Science, Innovation and Technology (DSIT) was meanwhile scrapped, with responsibilities for its areas of policy assigned to other departments.

Jonathan Reynolds was made Business Secretary with a beefed-up portfolio for his department that now includes science and innovation, while Lisa Nandy remained as Culture Secretary with an extended brief covering digital.

DSIT’s former responsibility for AI has meanwhile been transferred to the Cabinet Office, and Kanishka Narayan will now oversee AI policy as a minister straddling the Cabinet Office and Ms Nandy’s Department for Digital, Culture, Media and Sport.

Meanwhile, former Middle East minister Hamish Falconer will oversee the joint portfolio of intergovernmental and European relations.

A No 10 source said the new Cabinet brought together all parts of the Labour Party to deliver Mr Burnham’s agenda for the country.

Those who had proven delivery and who had the most experience had been tasked with overseeing the new Prime Minister’s key domestic priorities, the source said.

They also pointed out that Mr Burnham’s Cabinet had a balanced make-up – 50 per cent men, and 50 per cent women – and claimed that he had boosted the number of ethnic minority members of the Cabinet.

Among the measures Mr Burnham is exploring to help hard-pressed households with the cost of living are rent controls, support for energy bills and capping the cost of bus fares.

“We’re looking at measures that could make a difference this year. So we are looking at all of those things, but we’ll make more announcements tomorrow,” he told reporters in Downing Street’s rose garden on Monday.

A flurry of diplomatic phone calls also characterised Mr Burnham’s first day as Prime Minister.

The first among these were calls with US President Donald Trump and Ukraine’s President Volodymyr Zelenskyy.

In a Truth Social post, Mr Trump said he and the new Prime Minister had a “very good conversation”, adding: “The Prime Minister has got a big job ahead of him, but he will be able to do it and, of course, the U.S.A. will be there to help!

"We discussed North Sea Oil, Trade, the Military Alliance, Demining of the Hormuz Strait, and many other topics. The call was interesting, and went very well.