Burnham's bloodbath of the Starmerites

0:02This is a global production. The bloodbath of the Starmerites. We have a new cabinet for Andy Burnham. What does it tell us about where he's going? If you were disloyal to the Prime Minister, the then Prime Minister Keir Starmer, you are going to be rewarded. John Healey, congratulations, you're Chancellor of the Exchequer. Wes Streeting, you're now the Defence Secretary. Ed Miliband, well done, you're now the Foreign Secretary. If you think your political career is over, then what do you do? Life's hard out there, isn't it, at the moment. You heard me talk about the doorstep in Makerfield. We need to every day think, well, 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.

0:49We need to be a cost of living government and getting that cost of living down and looking at all possible ways of doing that. Andy Burnham was chosen by the Labour Party to communicate what Labour was about. In his first 24 hours, he has been clear. This is a government with the cost of living and dealing with the cost of living at its core. He has a new cabinet made in his own image, but the cost of that has been that nearly every ally of Keir Starmer's has been shown the door. And after that purge, life seems hard out there for those ex-Cabinet ministers. And they're making themselves heard.

1:32Are they about to become a thorn in Andy Burnham's side? Welcome to the News Agents.

1:44It's John. It's Lewis. And we now have a new cabinet, as we were saying there, a cabinet which in so many ways both ideologically regionally is clearly as i said made in the image of andy burnham as we might expect there was a lot of talk about the end of tribalism um and factionalism from andy burnham i think there are a lot of people who have been dispatched from the cabinet as we might discuss who might feel that the opening salvos of burnham's government have not necessarily shown that sort of come by our kind of approach that he said he would have but Anyway, the big headlines are John Healy, rather unexpectedly for most people, actually ends up being chancellor.

2:20It was neither Ed Miliband nor Shibana Mahmood. Ed Miliband becomes the foreign secretary. Shibana Mahmood stays as the home secretary. We're streeting again, perhaps a bit unexpected. It had been briefed at the weekend. But I think when he sat in the chair you were sitting in now, John, when he was in here in his brief period of rest, his little couple of weeks off between government jobs, I doubt if I'd said to him there, do you expect to become defence secretary? I'm not necessarily sure who thought that would be the top of the list. But nonetheless, there he is. Yvette Cooper moves from being the Foreign Secretary to the Health Secretary.

2:52And there are other appointments as well. But broadly speaking, what we can say is that this is a cabinet which has moved in a leftward direction towards the so-called soft left of the Labour Party. Most of, not all, but most of Keir Starmer's closest allies have been dispatched, removed from the cabinet. and it is a cabinet which again regionally as well very much a cabinet of the north of England only two MPs from London which when you consider that Labour have about 50 MPs in the capital quite remarkable from the northwest from Yorkshire in every sense we can say that Andy Burnham has remade this government and he has done so firmly despite all of that talk of as I say a more approach he has done so in a manner which he thinks reflects him and lewis you make the vital point that the people that were closest to keir starmer have gone and what that has done is create turbulence and waves with those supporters of starmer say so what's happened is that if you were disloyal to the prime minister the then prime minister keir starmer you are going to be rewarded You know, John Healy, you delivered the coup de grace that brought down Keir Starmer.

4:10Congratulations, you're Chancellor of the Exchequer. Wes Streeting, you walked out of the Cabinet too and said that Keir Starmer had to have a leadership contest. Congratulations, you're now the Defence Secretary. Ed Miliband, you said it was unsustainable for Keir Starmer to carry on. Well done. You're now the foreign secretary. And so there is a feeling that within the government, that if you have been disloyal, you get a promotion. And if you were loyal to the serving prime minister, you're out on your ear. And I thought it was really telling this tweet that came this morning from Darren Jones, who was, you know, the kind of prime minister's first secretary, the sort of, you know, number two almost to the prime minister.

4:54It felt like in the job that he had to be the voice of the prime minister putting out about the cut to VAT on domestic electricity bills, saying good news that VAT will be cut on electricity bill. It's a simple way for families to save a few quid and to mechanically help to keep inflation that little bit lower. So far, so supportive. But the digital ID programme was unfunded. The government will have to set out how it will pay for its new policies at the budget. Wow. They didn't wait long before he kind of slipped a knife in to what Andy Burnham was doing as prime minister. No, the irony is that Darren Jones, when he was sacked yesterday, the last tweet he had said that, you know, goodbye, see you in September.

5:37He didn't even last 24 hours before getting sufficiently irritated by something to, as you say, John, stick the knife in on his successes in government. I mean, just on that. I mean, I do think it doesn't strike me necessarily as quite the flex that Darren Jones might think it is to basically say, hey, look, we came up with this thing. We had no idea we were going to pay for it. So good luck. I mean, that in itself is not necessarily a complete model of good governance, right, which happened under the Starmer administration and under him. Nonetheless, you know, let's just take it on its own terms before we get into the factualism.

6:10I think what was very interesting about what we heard from Andy Burnham, you know, that address at his first cabinet, it is very clear and it has been very clear from his first words outside number 10 and in that cabinet meeting that he wants the message to be, have a sort of clarion call quality to it, to be crystal clear that this is a government which is focused mercilessly on cost of living. Now, one of the problems with the Starmer government, and I think one of his diagnoses about the problems with the Starmer government, is that it seemed it never had any particular clarity on what it was focused on.

6:44Sometimes it was growth, sometimes it was cost of living, sometimes it was standards, you know, foreign policy. And of course, all these things are interconnected. But, you know, they had five missions, they had, you know, milestones all of those different things that kind of came and went i think burnham has concluded that the public who have caused the bandwidth for their attention is highly limited he just wants to hammer that message again and again this is a government which is focused on what you're concerned about what i heard about in makerfield which is cost of living hence his first act is to reduce vat or to eliminate vat on energy bills 45 pounds saving for the average household now you You know, there are people who will say, and there's some validity to this, I think, that making, anchoring your politics around cost of living can be tricky and could backfire.

7:33Because obviously there is so much about cost of living that the government cannot control. You know, we've seen that with the Strait of Hormuz, international energy prices, food inflation, Ukraine. you know this happens again and again shocks economic shocks which repeatedly and consistently affect prices affect wages interest rates and so on all of which the government doesn't have that many levers to address i think the counterpoint to that is is that burnham's probably right which is he knows this is what people care about he's heard about that in makerfield everyone around the cabinet table knows that's what people care about so the alternative is to sort of ignore it or to not talk about it, in which case people think you are oblivious to it and are out of touch.

8:16So I think an interesting first move for a government which I think is going to be pretty laser focused on these domestic bread and butter issues. I think overwhelmingly it's been an incredibly sure-footed start from Burnham. You know, look, he's come in there. It took a long time to shape the cabinet, but cabinet reshuffles always take a long time. I'm sure a lot of people didn't get quite what they wanted and there's some disappointment in this. You know, all of that, I think that it's been sure footed, clear sighted. There is a plan. I think the focus on cost of living is probably absolutely right.

8:50I mean, you know, think back to Trump's election, affordability and the cost of living and the economy. These are the things that people are concerned about. The worst thing you can do as a politician is what actually Trump is doing now is to pretend there is no cost of living issue and there is no affordability crisis in America. And I think he just seems completely out of touch with the real lives of ordinary Americans. And I think that Andy Burnham reminding the cabinet around the table this morning about what they heard on the doorsteps in Makerfield and how a few quid can help, I think, is a really important thing.

9:20So I think from all of that, it's very, very sure footed. But Labour hasn't got a great history of killing off its leaders. And the Tory party can tell you that when you kill off a leader, there will be a bunch of people left behind who were loyal to that leader who are going to cause trouble. It's happened, you know, it happened when John Major replaced Thatcher. It's happened again and again and again. And, you know, sure enough, you've got a whole bunch of people now, not a majority, but there are some on the Labour back benches now who have had held high office, who feel disaffected, who feel pissed off, who don't know why they're getting up in the morning because they haven't got teams of civil servants there waiting for their every command, thinking, God, well, maybe I'll cause a bit of trouble.

10:04Yeah, as I said on the show yesterday, I think that we were talking about, I think that it's a sort of tale of two groups within the parliamentary Labour Party, how it will be over the next few months and beyond. Which is, as you were saying yesterday, John, I think your median Labour MP on the back benches of the parliamentary Labour Party, they're desperate for the government to succeed. You know, particularly for the 2024 intake, slender majorities in every direction. They know this is the last throw of the dice. It's got to work. so there will be extra authority for burnham i'm sure we'll see that you know not least because starmer had squandered so much so much of his but on the other hand there is a group and not insignificant group of about 50 or 60 maybe a little bit more of a starmer faction starmer never had much of a faction the irony is is that the way that burnham has perhaps treated some of these people may have helped gel them into a bit of a faction um who as you say john i mean they have got they've woken up this morning they were all in a pub last night courtesy of the sun we saw that kia starmer having a few you know i think good play to him yeah absolutely you know absolutely a few few pints down the pub rachel reeves there looking like the weight of the world has been lifted off her shoulders and that's all nice for an afternoon but then you wake up the next day exactly and you think to yourself okay what now what now the red boxes have gone the ministerial car has gone all that activity all that all that all that work the 18 hour days all of those decisions, nothing.

11:33You're still an MP, of course, but in terms of actual executive power, gone. And that's difficult. That's really hard to deal with. And so if you think your political career is over, then what do you do? You have very little incentive not to, when people like you and I call or invite them on a show like this, you think, yeah, maybe I will go. And maybe I will say what I think. And for Darren Jones, at least, it took all of about 12 hours for him to succumb to that temptation. What's so interesting is that I always thought that Darren Jones was the sort of the calm, grown-up, measured, he never sounded like his voice ever rose, he never sounded like his heartbeat was beating that bit faster, he was just always Mr.

12:16Cool and Mr. Measured and Mr. You know, he was the perfect foil for Keir Starmer in that communication and as you say he's clearly seething and that is what came out in that tweet that he put out um i think it's obviously very early days yet to talk about the operation but i do think that it's been pretty bloody slick the way that no one was talking about john healy becoming the chancellor of the exchequer didn't leak nothing leaked at all in the days and weeks and i think that this is sort of something that is very different from what we've seen where we were getting endless briefing from number 10 a lot of it kind of very unhelpful you know the the war between uh Keir Starmer and West Streeting and whether West Streeting needed to be put in his box or whether West Streeting was on manoeuvres against you know Keir Starmer all that sort of stuff I mean very early days but so far I've got to say that it looks like these are people there are grown-ups in charge who know what they are doing, who are working with Andy Burnham.

13:21So it looks like it is one team taking decisions. And that is a change. It is a change. And look, I mean, I was speaking to a few people last night who, you know, connected to the sort of Starmer faction, if we put it that way, who said, you know, I mean, it's absolutely true. Some of the reporting which has come out about this, you know, they are really, really pissed off because they feel that this was more bloody than it needed to be. Quite a few of them expected to go. And that's perfectly reasonable. when you get a new Prime Minister and they're going to bring in their own people, they're going to bring people who helped them get them there from their own faction in the Labour Party.

13:52But they say, look, this is all, from their point of view, they say, this is all Andy's mates. These are all people Andy knows. That's why it's so weight. I think there are five Greater Manchester MPs in the Cabinet alone. It's all people he knows. He's brought on some people from the younger reaches of the Parliamentary Labour Party, but not that many. It's a reshuffling of the pack. There were some they feel that didn't need to go who had done great jobs and they feel it was spiteful and and and petty um and they feel as well that i mean you know i'm told that kia starmer personally is really irritated by it he feels again some of his closest allies have been unnecessarily sort of punished and he feels exactly to the point that you were talking about john he feels and a lot of these people feel that the message that has gone out is that basically the bigger someone put it to me the bigger bastard you are, the more senior you become in this government.

14:44Now, I can understand why they feel that way. I think the other way of looking at it is that, you know, ultimately, as I say, Burnham has become prime minister and how people have helped him get there. And some of the people who he has sacked did not want him to be there and he doesn't feel he can trust them. So this is always a balancing act. And I think it's going to be a balancing act as well, because if these people, they're disaffected and they're dispossessed now, the 60 or so out there, I think that, I don't think there'll be much quarter, they'll get much quarter from the rest of the Parliamentary Labour Party if they all start doing what Jones did so quickly, which is to start sticking that knife in so quickly.

15:19For precisely the reason which I said before, which is that for your average Labour MP, this is the hope. This is the life hope. This is the last chance. You're in the boat and you don't want to see some of the people in the boat rocking it and deciding to put a few holes in the hull, right? So I think if these people are, I can totally understand why they're pissed off, But at the same time, you know, you've got to kind of play a slightly longer game if you're serious about reasserting some influence within the government overall. The other person that I'm fascinated by, which is Ed Miliband getting foreign secretary.

15:51And there's a story this morning suggesting that at the White House, they're deeply unhappy and tried to block this as an appointment. And I know I spoke to someone this morning, you know, US diplomat who didn't really give that impression at all. but I do think it's fascinating that Ed is the one of course who you know Donald Trump hated his policies on net zero and you know not drilling for oil and you could imagine that Ed Miliband knows his own mind because it does look like what we're going to have now is a prime minister very different from Keir Starmer who is very focused on domestic policies I mean of course he's going to have to travel, but he wants the focus to be on the cost of living in this country and what he can do to alleviate some of those pressures.

16:40Therefore, you're going to have a very powerful foreign secretary who is able to do foreign policy without that much intervention from number 10 Downing Street. And so Ed Miliband has got a track record as far as the United States of America is concerned from when he was leader of the Labour Party and opposed the bombing of Syria after they'd crossed the red line. And that led to Obama, of course, having to back down and said, you know, I'd have to get Congress. Well, maybe this is the way to get Trump on side, as Burnham just points out that, you know, you know, you know, you know, really hates him.

17:12Yeah. Yeah. It's Obama. Oh, really? Oh, really? I like the guy. I like the cut of his jib. Just tell him that Obama hates him and Trump will warm to him instantly. Yeah. And I think it's worth saying that, you know, for all of the predictions, again, that we saw in the Telegraph, I think, are probably, you know, trying to fly a bit of a kite with this stuff. But, you know, for all the predictions of perhaps complete foie d 'oeuvre instantly between Trump and Burnham, I mean, Trump put out, I mean, they spoke yesterday and Trump put out a pretty obliging post on Truth Social about Burnham, saying that he had a great conversation with the new Prime Minister of the UK, Andy Burnham.

17:44We discussed many subjects, including the outstanding relationship we have with the UK. We'll be meeting in the not-too-distant future for topics of mutual interest in Manchester, of course. He's been invited. Where else? but to some town the prime minister's got a big job ahead we discussed north sea oil trade the military alliance the the damning of the hormuz strait i wish prime minister burnham good luck and godspeed um so you know i mean pretty for all of the predictions yeah trump initially said he wasn't that interested in in speaking to him or or meeting him i mean normal diplomatic relations seem reasonably cordial so far yeah i the other thing that i think it's going to be fascinating to watch is you know John Healy resigned from the government over the failure to fund properly what he thought should be in the defence investment plan where he's now Chancellor of the Exchequer is he going to find the billions that he wanted when he was defence secretary to meet that and I think that there are kind of it's not just that question as well but there are all sorts of other questions about spending of what is going to happen now and how much of this can be done without an autumn budget or a very substantial autumn budget when it arrives well we should talk a little bit more about john healy because many people um may not be familiar with him and he was absolutely a surprise pick as chancellor to most people and he's now the second most important person in government we'll do that right after this

19:17So if you're not familiar with John Healy or don't know too much about him, of course, he was, as John was saying, the defence secretary in the Starmer government. He'd also been shadow defence secretary for a long time. he resigned in that spectacular fashion pretty much the kind of final nail in the coffin for Starmer a few weeks before he resigned accusing the Prime Minister basically then Prime Minister of not doing enough to protect the country and for not spending enough on defence this has proven to be I think one of the most effective political resignations that we've ever seen from any government because what has Healy managed to do?

19:55he has basically well he saw off the Prime Minister or helped see off the Prime Minister whether he intended to do that or not who knows but that was the effect and the net result has been that he has ascended to the second most important job in government and will now presumably as you say John be in a position to affect precisely what he always wanted which was an increase in defence spending to 3 % rather than 2.7 % of GDP by the end of the parliament. Now, that has some serious fiscal implications, not least because Burnham is talking about a lot of potential new spending priorities, and it will be for Healy to try and make those sums add up.

20:38So he's a bit of a sort of poacher turned gamekeeper in a sense with all of this. But I find it hard to believe, and he did a clip last night where he went as far as I think he could have done, I think, to affirm this. I find it hard to believe that he would have accepted that job unless he had some assurance from Burnham that he would be allowed to do that because how could he possibly resign on a matter of political principle in that way to such fanfare and to such devastating political impact and then as soon as he becomes a chancellor they go, oh actually maybe we don't need that money on defence after all you know, his credibility would be shot to bits so I think that's definitely going to happen but as you say, as a result this government's going to have to find some serious money to actually finance what Healy wants Fun fact, isn't it?

21:21Who was the last Labour Defence Secretary who became Chancellor of the Exchequer? Wasn't it Dennis Healy? Yeah, with the name Healy. Just keeps on reappearing. It's very important that we always have a Healy as Defence Secretary and then Chancellor under Labour Government. Much like, as Wisda say, we only win World Cups under Labour Governments, we only get Healys who have been Defence Secretary and then Chancellor under Labour Governments. It's very important. So, yeah, look, if they are going to meet this, you know, the Defence Investment Plan and to get to 3 % of GDP. As you say, there are big fiscal implications.

21:53That's a lot of money. That's a lot of billions of pounds that will need to be found for that. We've already got the kind of money that needs to be found for this cut in electricity prices and whether that is going to continue for the lifetime of this parliament or whether this is just a one-off event. So there will money have to be found for that. If Andy Burnham is looking for other ways to ease the pressure of the cost of living, then money will have to be found for that. So you are now talking about a significant fiscal event. I mean, go on. Well, I was just about to say, I think in the last 24 hours, you know, and slightly before that as well, you know, he's talked about relief for business and business rates and business taxation.

22:30He's talked about the importance of raising the limit on the personal tax threshold or income tax allowance that is currently frozen at about£12 ,500. It's been frozen for some time. He's talked about more support for high streets. He's talked about more support on every kind of element I can think of in terms of, you know, spending and potential tax cuts. So, you know, if he's serious about this stuff, we're talking about a bill that could easily run into the tens of billions of pounds. So that comes back to what I was going to make as a central point, which is if you are doing that, I mean, unless you are going to slash departmental budgets and say, right, the welfare budget is going to be cut by, you know, 10 billion pounds.

23:12And you've just got to find out you've got to find a way of doing that. pat mcfadden you are then in a position where you're going to have to be coming up against your manifesto commitments of not raising you know income tax or not raising vat to fund all of that or you're going to have to increase borrowing which will send the markets spiraling and so you do wonder i mean this is a question we raised yesterday of how you can do this without a fresh mandate of whether you know if you are really going to do all these things can you do them all without going to the British people and saying right this is our plan this is our 10 year plan this is how we're going to alleviate the cost of living for the people that are most hard pressed this is our offering to you the British people but to do it without that I think becomes really problematic.

23:58I think it is very difficult and and uh it's something I think that if he is as we were saying yesterday if he is serious about offering profound political and economic transformation he will find increasingly that he chafes on the leash of the 2024 manifesto because it was a manifesto that was deliberately modest it talks a big game in terms of wanting to offer profound change but in terms of the diet the prescription as we've talked about many times before in many ways it was modest now i think burlam thinks he can kind of get away on that because he can sort of point to particular passages which talk about you know the the the transference of sort of wealth and power to ordinary people and ordinary communities but all Labour manifestos talk in those kind of, or many of them anyway, in those sorts of generalities.

24:42And so I think he will find it a more acute problem if he's serious. And this is, as we were saying yesterday, the kind of the tension, the conundrum at the heart of this government. If he's serious about that change, it's going to be more difficult as time goes on. And I think it's worth sort of saying, not least when, I mean, you talk about the fiscal implications. You know, Rachel Reeves has already penciled in for the back end of this parliament quite substantial just to get the sums, the Starmer sums to add up. she's already penciled in quite substantial departmental cuts real terms cuts for quite a few departments um in the back end of this parliament in the next couple of years now i think most people most economists would have said that that was always going to be quite unrealistic as you get towards a general election seems quite unlikely that any government particularly a labor government would want to be doing that but you know the fiscal situation is pretty fragile and so you add on to all these extra spending commitments and so on without some pretty some innovation, let's put it that way, some changing of the fundamentals, it's hard to see how it happens.

25:40I mean, I think it's worth thinking about why he chose Healy in the end, right? Which is because everybody was talking about if he wants a more political chancellor, he'll go for Ed Miliband because of all of his experience and the fact he's just far more political. If you go, if you want someone a bit more apolitical or someone who is perhaps less of a risk, particularly with the markets, and you go for Shibana Mahmood, and yet he's gone for John Healy. And the way someone put it to me is that it's a bit like basically, you know, he's not going to irritate anybody in particular. You know, it's a classic kind of bit of a Labour Party fudge.

26:10If you'd gone for Shabana, the soft left of the party would have been really pissed off. If you'd gone for Ed, the right would have been pissed off. The city might have been pissed off. It may have had some impact in the markets. Who knows? So you've gone for the guy who, you know, is sending a signal, if nothing else. I think the advantages they saw it doesn't piss off people internally in the party. It sends a signal, particularly to Trump, but also to NATO allies and so on, that we're serious about defence because you wouldn't have appointed the guy otherwise. And also they say that he is quite simpatico with Burnham on the devolution agenda, the fiscal devolution agenda, because, and this is something maybe we all missed a little bit, you know, Healy did work for the Treasury or in the Treasury under Gordon Brown.

26:50He was a junior minister then. He was close to Brown. Burnham knew him then. And Burnham feels he's quite aligned on all that stuff. And I think they were worried that with someone like Ed or Shabana, that you might end up appointing someone who maybe goes in their own direction. And we've had plenty of experience of that. That said, there's also a long history of prime ministers appointing chancellors who they think are going to be their people. And it turns out that actually they're not necessarily their people. Gordon Brown and Alistair Darling, good example of that. Boris Johnson and Rishi Sunak, a good example of that.

27:22Sometimes it's quite hard in our system to have a weak chancellor because a treasury is so powerful. Yes, I think what's interesting as well is that the fact that John Healy has got very developed views on what the Treasury does and how it works. And, you know, and he's been quite critical of it institutionally. And I think there are also going to be relations about, you know, between Treasury and the Bank of England, about whether you're going to reorder priorities for the Bank of England in the way that they are doing things at the moment as well, which could have quite profound economic consequences.

27:53So I don't think that, you know, I think that the most powerful argument I heard against Ed Miliband being Chancellor of the Exchequer was that you will recreate the situation that you had when Tony Blair was Prime Minister and Gordon Brown was the Chancellor and they were loggerheads. And, you know, Gordon Brown absolutely determined to go his own way on the economy and infuriating number 10 every single turn. And I think you would have had sort of an imperial chancellor again if Ed Miliband had been made chancellor. He's a very effective political operator. He's very skillful in the way that he manages Whitehall departments.