Andy Burnham is understood to be planning an “expansive” Budget later this autumn once he finally gets the keys to Number 10 Downing Street.
Reports suggest the likely next Prime Minster is floating a major overhaul by combining the fiscal statement with a comprehensive departmental spending review.
It is believed this would establish his Government’s economic direction through to the next General Election, The Financial Times reports.
Treasury sources indicate that officials have begun examining this possibility following initial discussions with Mr Burnham’s team, with October emerging as a potential date for the combined statement.
The likely next Prime Minister is plotting major changes in the upcoming Budget
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Economists warn that funding decisions for the remainder of the parliament will dominate his early weeks in Mr Burnham’s Government.
Sources are sharing that the proposal would see tax measures and departmental budget allocations announced simultaneously rather than in separate exercises.
One person close to discussions said: “The idea would be to do a big one-off fiscal statement with all the tax and spending decisions taken at the same time.”
Proceeding with the plan would require the incoming Chancellor and Chief Secretary to the Treasury to negotiate departmental settlements over the coming three months, rather than deferring until next year as originally intended.
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One ally of Mr Burnham acknowledged that timing presents the primary obstacle, cautioning: “I can’t see Whitehall shaking out a spending review in that time.”
Mr Burnham has been consulting senior civil servants about his governmental options alongside James Purnell, his chief of staff, and Louise Haigh, a former cabinet minister expected to secure a prominent position in his administration.
A Treasury veteran described combining the spending review with Budget tax decisions as “sensible” but characterised completing the entire process within three months as “ambitious”.
Such acceleration would compel Burnham to arbitrate between competing departmental demands while existing financial settlements remain exceptionally constrained.
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Chancellor Rachel Reeves established a single-year departmental settlement for 2025-26 in her inaugural Budget in 2024, subsequently outlining broader plans in last summer’s spending review covering day-to-day expenditure through 2028-29.
Mr Burnham’s review would determine budget distribution for 2029-30, coinciding with the final possible months before an election that must be called by August 2029.
The Office for Budget Responsibility (OBR) warned in March that unprotected departments, including justice and home affairs, face real-terms spending reductions of 4.4 per cent across 2029-30 and 2030-31.
James Smith, chief economist at the Resolution Foundation, said Burnham would require at minimum a smaller-scale spending review this autumn to address commitments such as the Defence Investment Plan.