Chancellor John Healey asked Cabinet ministers to identify budget cuts shortly after Prime Minister Andy Burnham faced backlash for proposing an unfunded tax cut.
During Burnham’s first Cabinet meeting, Healey emphasized the need for departments to reexamine spending priorities.
Healey said his main responsibility is to keep strict control over government finances.
He stressed that reprioritizing spending could help ease the rising cost of living for families in the future.
Healey added that such steps would help make life more affordable and preserve fiscal discipline.
Burnham echoed the message, urging ministers to think about how to fund their proposed policies.
He said he would lead a government focused on reducing living costs and managing public spending wisely.
Healey welcomed the recent VAT cut on energy bills as a sign Burnham is providing practical support.
Burnham’s push for tighter spending control came just hours after Darren Jones, a former top official, criticized the government over an unfunded tax cut.
Jones pointed out that the digital ID policy, now canceled, had no clear financial plan attached.
Burnham stressed the need for unity in Cabinet and said he would work closely with cabinet secretary Antonia Romeo.
He said this teamwork would help avoid the public disagreements that hurt the previous Starmer government.
Burnham aims to build better working relationships with civil servants to improve government efficiency.
Healey is expected to focus on increasing defence funding, a key issue after he left the Starmer government over disagreements on military spending.
A major Budget is expected later this year. It will outline financial constraints for the government ahead of a Spending Review in mid-2027.
Burnham plans to introduce more fiscal policies soon. He already announced a VAT cut on energy bills on his first full day in office.
Pubs could benefit from proposed business rate reductions, another likely policy to be announced.
Burnham and his team discussed several policy ideas during election campaigning in Makerfield. Not all may make it into the final plan.
It remains unclear which of these proposals will be put into action and which will be dropped.
Healey’s focus on defence funding is seen as a strong possibility for his agenda.