Andy Burnham is encountering significant opposition from the Left of his party regarding the potential appointment of Shabana Mahmood as Chancellor, with some MPs advocating for Ed Miliband for the role.
Rachael Maskell, a Labour backbencher and MP for York, publicly stated that Mahmood would not be the appropriate choice for Chancellor, instead backing Energy Secretary Ed Miliband as a suitable candidate. This comes as Burnham prepares to formally take over as Labour leader.
While Burnham's team maintains that no final decisions have been made regarding cabinet appointments, reports suggest Mahmood is a frontrunner for the Treasury position. This potential appointment has reportedly unsettled markets, and some unions oppose Miliband due to his stance on North Sea oil and gas.
Critics on the Left of the party have also raised concerns about Mahmood's immigration policies. Zack Polanski, leader of the Green Party, suggested that Burnham might be influenced by financial institutions in London, leading him to consider Mahmood over Miliband.
Mahmood's past policy positions include advocating in 2014 for the restoration of the top rate of income tax to 50 pence in the pound, arguing that its reduction by the Conservative government was unfair. She later served as a shadow Treasury minister.
Burnham and his potential Chancellor are expected to face immediate fiscal challenges, including a gap in defense spending. Despite market reactions that have reportedly favored Mahmood's potential appointment, she and Burnham have previously expressed support for policies such as windfall taxes on oil and gas companies, levies on tech giants, and equalizing capital gains and income tax. Burnham has also indicated a potential for tax increases, stating a need to move beyond dependence on bond markets.
Meanwhile, Miliband's supporters within the party believe they have successfully pushed back against his potential appointment as Chancellor, a role that some within the Labour party view as potentially divisive despite his popularity with members and the Left. City figures had previously voiced concerns about Miliband potentially increasing government borrowing.