Andy Burnham's incoming government is experiencing internal turmoil as the decision for the crucial Chancellor of the Exchequer role remains undecided, with reports suggesting Shabana Mahmood is now the frontrunner over Ed Miliband. The uncertainty has sparked a briefing war in Westminster.
One ally of Burnham stated that Mahmood is "nailed down as Chancellor," indicating a likely appointment. However, other sources close to the incoming prime minister insist that no final decision has been made with just days before entering Downing Street. Yvette Cooper, the Foreign Secretary, is also reportedly still seeking the position, with her supporters highlighting her prior experience as a Treasury minister in the previous Labour government.
Ed Miliband had long been considered the leading candidate for the Treasury role, having collaborated with Burnham on economic plans for an extended period. However, his potential appointment has encountered strong opposition from a coalition of business groups, trade unions, and some Labour MPs. Sharon Graham, general secretary of the Unite union, previously cautioned Burnham, characterizing Miliband's focus on Net Zero as detrimental to job creation.
Investor sentiment also appears divided. A Bloomberg survey indicated that only five percent of investors support Miliband as Chancellor, with Mahmood garnering 11 percent. Wes Streeting had previously led this metric with over 30 percent support but has since lost favor. Nevertheless, bypassing Miliband at this stage could provoke a significant reaction from left-wing MPs advocating for a substantial shift in policy direction.
Speculation suggests Miliband might be offered the position of Foreign Secretary as an alternative, though denying him the Treasury could alienate a key ally who was instrumental in challenging Keir Starmer. Supporters of Miliband argue he possesses the necessary experience to implement significant changes at the Treasury, warning that failing to appoint him could result in a "continuity Starmer government" where the Treasury retains excessive influence.
Tory frontbencher Ben Obese-Jecty criticized Burnham's indecision, stating it demonstrates a lack of preparedness for government and could lead to last-minute, poorly considered cabinet appointments. A spokesman for Burnham has maintained that no cabinet decisions have been finalized. However, an ally speaking to the Financial Times asserted that Mahmood's appointment as Chancellor is certain.
Mahmood has reportedly expressed a preference for remaining at the Home Office, and a move would create a difficult-to-fill vacancy. Her economic experience is described as limited, primarily consisting of a junior role on Labour's Treasury team in opposition. Appointing a figure from the Labour Right to the Treasury could also face opposition from left-wing factions.
In contrast, Cooper possesses considerable experience as chief secretary to the Treasury. Miliband also has a background as an advisor in the Treasury under Gordon Brown. Treasury officials are reportedly preparing to brief Burnham and his chosen chancellor on the fiscal challenges ahead, with the Resolution Foundation think tank noting that the new administration will inherit a strained financial position, further impacted by the Iran war which has reduced fiscal headroom by nearly £15 billion.
Burnham himself has indicated a potential for tax increases, suggesting that the public may be asked to contribute "a little more." Kemi Badenoch of the Conservative party criticized Labour's focus on taxation, suggesting it signals continued economic difficulties regardless of who holds the Chancellor position.