Andy Burnham is poised to unveil the principal members of his new Labour Cabinet on Monday, a day marked by internal party disputes over who will be appointed Chancellor. The position of Chancellor is reportedly contested by Ed Miliband and Shabana Mahmood, with Rachel Reeves expected to be removed from the role.
The potential appointments have triggered a significant briefing war within the party, highlighting ideological divisions. Supporters of Ed Miliband, the Energy Secretary, are advocating for his appointment, citing his focus on green energy and the Net Zero by 2050 target. However, concerns have been raised by businesses and moderate factions about his economic policies potentially unsettling financial markets. Conversely, speculation that Shabana Mahmood, the former Home Secretary under Sir Keir Starmer, could take the Treasury role has been met with calmer market reactions.
Dale Vince, a significant Labour donor and green energy entrepreneur, has cautioned against appointing Miliband as Chancellor, describing his spending decisions in the Department for Energy Security and Net Zero as poor value for money and ineffective in addressing carbon emissions. Vince suggested Miliband would become a target for criticism and that he could be better suited for other roles.
Former Labour minister Lord Hutton urged the new Prime Minister to select a pro-business Chancellor to ensure market confidence, emphasizing the need for a reboot of the economic growth plan. Briefings against Miliband have described him as a "threat to Britain" in the Treasury role, which Burnham has previously condemned as "appalling."
The centre-left Mainstream grouping within the Labour party has called for a "progressive chancellor" who understands the threat of climate breakdown and possesses the resolve to rebuild the state's productive capacity, seemingly in reference to Miliband. However, Miliband has been polled as the least market-friendly candidate and has previously clashed with unions over North Sea oil jobs in relation to his green energy agenda.
A veteran Labour MP on the party's Left expressed doubt about Miliband's appointment to the Treasury, calling it "too big a risk." Meanwhile, Shabana Mahmood is reportedly unpopular with the party's Left due to her stringent immigration reforms.
Earlier, Lord James Timpson, the prisons minister, became the first government minister to resign, followed by science minister Lord Patrick Vallance. Their departures are part of the broader cabinet reshuffle expected following Burnham's assumption of leadership.