Finance Matters Insights
New UK Prime Minister and Chancellor: what it means for your finances
Happy Monday,
We have a new Prime Minister (again). Andy Burnham has been appointed in cabinet which makes him our 6th PM in five years. To add, John Healey has been appointed as our new Chancellor, replacing Rachel Reeves.
You might think it doesn't concern you, but these changes certainly impact your finances in one way or another.
What we know about Andy Burnham
Burnham was a Labour MP for over two decades before becoming Mayor of Greater Manchester in 2017, where he ran three terms and earned the nickname "King of the North" for standing up to Westminster during COVID.
He held Treasury and Health Secretary roles in Labour's previous government, so he isn't new to the job. Strong communicator, generally seen as pragmatic, but a few of the bigger ideas he's floated over the years (like a wealth tax and a land value tax) have caused nerves in the City.
🏛️ What changes with a new PM
By taking over mid-parliament rather than via election, it means Labour remains in government. Typically this looks like a continuity play rather than a complete overhaul as far as policies are concerned.
The most notable change is at the Treasury. With John Healey now as Chancellor, we might see new announcements in the next Budget (Oct/Nov 2026) depending on how his strategy and views differ from Rachel Reeves. Healey is referred to as a surprise pick, most recently serving as Defence Secretary under Starmer.
For your money, the Chancellor matters more than the PM day to day. It's the Chancellor who sets tax policy, delivers the Budget, and works most closely with the Bank of England. So it's Healey worth keeping an eye on more than anything else over the coming months.
📌 Initial PM announcements
Two announcements landed within his first 48 hours in office.
The first: VAT on household electricity bills will drop from 5% to 0% from October, saving the average household around £45 a year. Small in isolation, but a clear signal that the immediate focus is cost of living rather than anything more structural.
The second: Burnham hinted at "looking at" the personal allowance (the amount you can earn before you start paying income tax), which has been frozen at £12,570 since 2021 and is due to remain frozen until April 2031. If unfrozen, it would put more money in most people's pockets, but nothing is confirmed yet.
Also worth flagging that Burnham has previously spoken about replacing stamp duty with a land value tax on property sales. Not on the immediate agenda from what I've seen, but a policy that would meaningfully reshape how property is taxed if it ever landed.
💡Signalling vs Policy
The Autumn Budget is expected in late October or November 2026, and that's where signalling turns into confirmed policy. This is what truly matters.
Until then, we're likely to hear a lot of potential changes being floated. This is a common approach to get a feel for how people like you & me might react to potential policy changes so I often encourage people to stay aware but not panic.
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Fisayo Martins
Founder at Finance Matters UK
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