Andy Burnham’s ‘Manchesterism’: How His Vision Could Reshape the UK Economy
Burnham’s Economic Model and Policy Vision
By Andy Bruce and Sarah Young
LONDON, June 19 (Reuters) - Andy Burnham's return to parliament has made the Greater Manchester mayor the frontrunner to succeed Keir Starmer as prime minister, and with him comes "Manchesterism", his vision for Britain.
Burnham won a by-election in the northern English constituency of Makerfield after nearly a decade outside Westminster as mayor of Greater Manchester, one of Britain's biggest cities.
The 56-year-old wants to draw on lessons from Manchester's rapid economic rise to rewire Britain's economy, dogged by stop-start growth and strained public finances.
Here's what we know about his economic model, which he describes as "business-friendly socialism", and his wider plans.
Devolution: Shifting Power Away from London
DEVOLUTION
Burnham's vision is clearest on devolution: accelerating the shift of power away from London, which has increasingly dominated Britain's economy in recent decades.
While some power has been decentralised over the last 30 years - to parliaments for Scotland and Wales and elected city-region mayors among others - progress on shifting economic levers such as control over infrastructure spending or taxation has been limited.
That leaves Britain as one of the most financially centralised countries in the developed world, according to OECD data. Economists say this has widened inequality between London and elsewhere.
Burnham has vowed to reshape Britain's financial architecture by giving communities direct control over the things that shape daily life: housing, utilities, transport and education.
He cites Manchester's integrated Bee Network - a system that has drawn people back into public transport - as Manchesterism in action.
Tax and Spending: Fiscal Credibility and Social Investment
TAX AND SPENDING
Balancing the Books
Burnham has yet to set out how he would balance tax, spending and borrowing. His campaign has focused on trying to reassure investors of his fiscal credibility.
Last September, Burnham unnerved investors by stating that Britain had to get "beyond this thing of being in hock to the bond markets".
In January, he said he had been misrepresented: he was not indifferent to the £2.8 trillion ($3.7 trillion) British sovereign bond market, but believed the "low-growth loop" economy did not benefit investors.
Privatisation and Social Housing
Burnham says years of privatisation and deregulation have not only stripped the government of control over its costs and services but also saddled it with inefficiencies.
As a prime example, he cites a chronic shortage of low-cost social housing, which leaves the state paying large sums in benefits that flow to private landlords.
Tax Policy and Fiscal Rules
Burnham has vowed to keep within the existing fiscal rules - which include balancing day-to-day spending with revenues by 2029/30 - and to honour Labour's 2024 manifesto promise not to raise taxes on working people.
That pledge rules out increases in the rates of the taxes that raise most government revenue: income tax, employee National Insurance and value-added tax.
He has walked back some proposals with large implications for spending, including compensation for women whose retirement age was raised from 60 to 65, and cuts to student loan repayments.
Pensions and Utilities
Burnham has, however, committed to keeping the triple lock, a policy that increases the state pension each year in line with inflation, average earnings growth, or 2.5% - whichever is highest - costing the Treasury billions of pounds.
On utilities, he has called for greater state control while stopping short of committing to full re-nationalisation, a distinction that critics say lacks definition. But in the case of the debt-laden Thames Water, Burnham said he could see a case for public ownership.
National Economic Credibility
"His national economic credibility is untested ... It remains unclear whether his regional approach would translate effectively to national policy," said Kallum Pickering, chief economist at investment bank Peel Hunt.
Immigration: Balancing Control and Compassion
IMMIGRATION
Burnham backs some of the tighter immigration policies brought in by interior minister Shabana Mahmood in recent months, which are aimed at limiting both legal and illegal migration.
On illegal migration, Burnham has said he would consider tougher measures to deter people from crossing the Channel from France in small boats, while also arguing that refugees need safe legal routes to Britain.
He has said people already in the country who are "left in limbo" by the immigration system need to be able to work, suggesting he could soften some of Mahmood's measures.
Health and Social Care: Reforming for the Future
HEALTH AND SOCIAL CARE
Burnham, who was health minister from 2009-2010 during Gordon Brown's premiership, has said he would try to reform Britain's social care sector with the aim of easing pressure on the National Health Service.
Successive governments have struggled to overhaul social care as the cost of looking after older people in care homes soars.
He told the Guardian newspaper he would consider how changes to inheritance tax could help to fund a fix to social care.
European Union Membership: Burnham’s Evolving Stance
EUROPEAN UNION MEMBERSHIP
Burnham campaigned for Britain to stay in the European Union at the time of the Brexit referendum in 2016. Two years later, when the terms of the exit were being negotiated, he said he would back a second referendum.
Last year he said he wanted to see Britain rejoin the EU in his lifetime. After becoming the candidate for Makerfield, he said seeking EU membership was not a priority.
"I'm not proposing that the UK considers rejoining the EU," he said when launching his campaign. "I respect the decision that was made at the referendum."
(Editing by Kevin Liffey)
