New Prime Minister Andy Burnham is under fire from the Conservative party, which alleges his administration is poised to enact extensive spending plans totaling £96 billion without clear funding mechanisms. Critics contend these proposals could lead to an annual tax increase of £4,300 for working families, a charge they describe as a "tax bombshell."
According to a dossier compiled by the Tories, the estimated £96 billion cost is based on policies announced in Burnham's first week in office and his projected future plans. The opposition claims there is no adequate explanation of how these initiatives will be financed.
Burnham's initial policy announcements upon taking office reportedly amount to £1.7 billion. These include pledges to remove VAT from electricity bills, cap bus journeys at £2, end rough sleeping, and reduce business rates for pubs and music venues. However, critics argue that many of these promises were unfunded.
A significant portion of the projected spending involves addressing the adult social care crisis, which is anticipated to cost £18 billion. Furthermore, the Tories accuse Burnham's administration of outlining future commitments, part of a ten-year plan, that could total an additional £76 billion. These long-term plans reportedly include £18.8 billion for council house construction, £22.7 billion to bring Thames Water under public control, £14.1 billion for future defense spending, £12.4 billion to unfreeze income tax personal allowances, and an £8 billion increase in foreign aid.
Specific attention is being drawn to defense spending, as Chancellor John Healey reportedly resigned from the previous government over its refusal to fund military upgrades. The current plans reportedly include a £5 billion shortfall for existing defense commitments and an additional £10 billion to meet a target of 3% of GDP for future defense spending. Burnham's government has also indicated a move towards public ownership of Thames Water and a review of income tax thresholds.
Shadow Chancellor Sir Mel Stride criticized Burnham's approach, stating that the Prime Minister is "writing cheques British people can't cash" and that his administration lacks a coherent plan. Stride suggested that families, already facing high taxes, could be subjected to further increases.
Burnham's team has countered these accusations, asserting that the Prime Minister has implemented tax cuts and that all announced measures are fully funded. They dismissed the claims as "nonsense."
Some initial announcements have faced scrutiny. The plan to remove VAT from electricity bills was reportedly unfunded, as the digital ID card project intended to finance it had not been budgeted for. Similarly, the funding details for a proposed £2 cap on bus journeys were questioned, with the Transport Secretary admitting they had not been fully