Overview
- Prime Minister Andy Burnham used his first Commons statement to promise to 'restore hope', push power to local areas and pursue greater public control of utilities as engines of growth, speaking to MPs on Tuesday.
- Investors sold UK government bonds, driving long-term gilt yields to multi-decade highs and shrinking fiscal headroom that the Chancellor must address ahead of the Budget.
- Chancellor John Healey has said the Budget will not set a timetable to reach 3% of GDP on defence and that a clear path will be published at the next spending review instead.
- At his first PMQs Burnham would not rule out further borrowing or tax rises to fund government plans while insisting the Treasury will stick to fiscal rules.
- The new premier faces political strain from opposition attacks, Labour backbench pressure on electoral reform and backlash over a prison early-release policy, all while Sir Keir Starmer has announced he will stand down as an MP.