UK Cost of Living Measures

British Prime Minister Andy Burnham has announced a 20% reduction in business rates for pubs, clubs and live music venues in England, taking effect from April 2027. The £100 million package will apply to nearly 32,000 hospitality businesses and is expected to save a typical pub roughly £1,100 annually.

The government said the measure is fully funded through a review of tax reliefs for businesses such as vape shops and a crackdown on online marketplaces failing to meet tax obligations. The discount builds on a 15% relief introduced earlier in 2026. Burnham also outlined a reduction in VAT on electricity bills averaging £45 a year from October 2026, financed by scrapping the digital ID scheme.

Burnham is meeting Scottish First Minister John Swinney and Welsh First Minister Rhun ap Iorwerth in Glasgow on Wednesday. Separately, broadcaster Gary Lineker is among 120 UK-based millionaires urging the prime minister to impose higher taxes on their wealth in an open letter.

Andy Burnham has outlined a sweeping cost-of-living agenda, removing VAT from household electricity bills from 1 October and cutting the national bus fare cap in England from £3 to £2 in January, after his pledge to scrap the digital ID scheme and technology department stirred political backlash.

The £850 million cost of the VAT reduction will be funded by cancelling the digital ID programme, a move digital minister Darren Jones said was possible because the scheme had never been funded. Bus fare subsidies will partly come from £400 million redirected from international climate finance. Burnham told his cabinet he wants a [

Prime Minister Andy Burnham has rebuked cabinet ministers Wes Streeting and Shabana Mahmood after they were caught on microphone joking about releasing prisoners early. Defence Secretary Streeting was heard telling Home Secretary Mahmood that new Justice Secretary Alex Norris "wants to let them all out", a remark he later said referenced a joke between Theresa May and Kenneth Clarke. Both ministers apologised, with Mahmood calling the early release scheme an extremely serious issue.

Conservative leader Kemi Badenoch accused the pair of making light of government policy. Victims of crime accused the ministers of making cheap jokes, while victims' commissioner Claire Waxman wrote to Burnham and Norris urging reconsideration of the scheme.

The early release scheme was announced in 2024 to ease prison overcrowding. Under the new Sentencing Act taking effect in September 2026, around 6,000 criminals are set to be released early, with some offenders freed after serving a third of their sentences.

UK inflation fell to 2.6% in June, down from 2.8% in May and marking the lowest reading since March 2025. The decline beat economists' expectations for a 2.7% rate, driven primarily by falling energy costs as petrol prices dropped 2.1p per litre and diesel fell 10.7p per litre between May and June, a move linked to de-escalation in the Iran conflict.

Food and non-alcoholic drink prices also contributed to the slowdown, with annual inflation in the category easing to 1.7% from 2.2% the previous month. On a monthly basis, consumer prices edged up just 0.1% in June.

The relief may prove temporary. The Bank of England projects inflation will climb back to 3% in the third quarter, though a planned cut in VAT on electricity bills to zero from October may help offset upward pressure later in the year.

Prime Minister Andy Burnham has announced a new £2 cap on single bus fares across England, effective from January 2027, backed by £454 million in government funding.

The policy, which reverses a fare increase introduced by Keir Starmer and Rachel Reeves in 2024, will replace the existing £3 nationwide cap currently scheduled to run until the end of March 2027. Approximately £400 million of the funding will be sourced by converting international climate finance investments into loans.

Burnham told his cabinet on Tuesday that they would be a "cost of living government," adding that every minute not spent discussing the issue was "wasted." The fare reduction forms part of a broader push to position the administration around household affordability.

Lenders holding most of Thames Water's debt have offered the UK government a 'golden share' granting veto power over major decisions and hostile takeovers, in a revised bid to prevent nationalisation after a previous £10 billion rescue proposal was rejected.

The London & Valley Water consortium, representing about £17 billion of the utility's more than £20 billion debt, said the new plan would write off nearly half the debt and inject fresh capital while suspending dividends for 10 years or until a public listing. The group is also evaluating local public supervisory structures and has signalled a legal challenge if ministers proceed with nationalisation.

Prime Minister Andy Burnham has pushed for greater public control of the provider. The renewed negotiations came as Thames Water imposed a temporary hosepipe ban on Tuesday, citing an exceptionally warm and dry spring.

Prime Minister Andy Burnham has vowed to end rough sleeping in England as the first policy directive of his new government, backing the pledge with £340 million drawn from unused housing department funds.

The funding is expected to deliver 1,200 homes and intensive support for at least 3,000 people over five years. Burnham previously oversaw a two-thirds reduction in rough sleeping during his first five years as Greater Manchester mayor, though the figure has since risen in each of the past four years.

The initiative confronts a deepening crisis: official statistics recorded a record 4,793 people sleeping rough on a single night in autumn 2025, while 176,130 children sat in temporary accommodation at the end of last year.

Prime Minister Andy Burnham has announced a cut in VAT on household electricity bills from 5% to zero taking effect on October 1, saving a typical household £45 a year. The policy, funded by scrapping a planned digital identity card scheme, will not apply in Northern Ireland, where EU VAT rules under the Brexit deal prevent the reduction. The Northern Ireland Executive will instead receive comparable funding to support households directly.

Communities Minister Gordon Lyons criticised the arrangement as overly complex. The measure arrives as household energy prices remain elevated following a £221 rise in the price cap on July 1, bringing it to £1,862 annually. Cornwall Insight forecasts the October cap will fall by only around 0.5%, while energy debt sits at a record high and wholesale gas prices have surged more than 40% in the past two weeks. The VAT cut is funded through the financial year to March 31, with further measures expected at the Budget.

Andy Burnham has appointed John Healey as chancellor of the exchequer in his first cabinet as prime minister, replacing Rachel Reeves, who confirmed her departure and declined another senior role. Healey's promotion comes just over a month after he resigned as defence secretary over disputes about military funding, having served in the role since July 2024.

Ed Miliband was named foreign secretary and Shabana Mahmood retains the home office, while Louise Haigh was confirmed as first secretary of state. Several senior figures, including David Lammy and Steve Reed, were dismissed from the cabinet.

Burnham said he would adhere to fiscal rules agreed under Keir Starmer's government but use any available flexibility. UK 10-year gilt yields rose to 5.049% following the appointments. Burnham also spoke with European Commission President Ursula von der Leyen and US President Donald Trump, agreeing to hold a UK-EU summit later this year.

Keir Starmer formally submitted his resignation as prime minister to King Charles III on Sunday, ending his tenure at Downing Street. Starmer delivered a farewell address to the nation earlier in the day before travelling to Buckingham Palace. The move clears the way for Andy Burnham to become prime minister, who is scheduled to visit the King to accept the role. Burnham, proclaimed Labour leader last week following an internal party vote, will succeed Starmer immediately.

The incoming prime minister has already signalled policy shifts, with plans to scrap the digital ID scheme and expand oil and gas drilling. The leadership transition marks a significant change in direction for the Labour government.