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ITV News Political Correspondent Romilly Weeks explores the fractures already emerging in the new government, while Midlands Correspondent Ben Chapman hears what voters in a Reform-controlled council think of the new PM <\/p>\n
Andy Burnham told ministers he will lead a “cost-of-living” government as he chaired his first cabinet meeting since entering No 10.<\/p>\n
The prime minister assembled his top team hours after announcing his first policy – a VAT cut to household electricity bills from October to help people with the cost of living.<\/p>\n
He told his cabinet “we need to be a cost-of-living government” and give people a “sense that help is coming”. <\/p>\n
John Healey said the energy cut will given families some ‘breathing room on bills’ Credit: PA<\/p>\n
Opposite Burnham sat his newly appointed chancellor, John Healey, who said the move to cut VAT on electricity bills would provide reassurance over the winter.<\/p>\n
Healey acknowledged the policy would not “solve the cost of living” but said it would help 29 million homes feel better off.<\/p>\n
The VAT rate on household electricity will be cut from 5% to 0% starting on October 1 for six months until the end of the financial year in March. It is expected to take \u00a345 off the annual price cap.<\/p>\n
The policy will cost the Exchequer around \u00a3850 million in 2026\/27. <\/p>\n
Andy Burnham’s cabinet met for the first time on Tuesday. Credit: PA<\/p>\n
The cut will be funded through the cancellation of the digital ID programme,<\/a> proposed by Keir Starmer’s government ahead of last year’s Labour conference, which aimed to make it mandatory for right-to-work checks as part of a crackdown on illegal immigration.<\/p>\n But Burnham’s team has scrapped the scheme to “refocus priorities”.<\/p>\n \u201cWestminster has not been working for people for too long, with families struggling with the cost of living,” Burnham said as he announced the tax cut. <\/p>\n Burnham announced that VAT will be removed from domestic electricity bills from October 1. Credit: PA<\/p>\n \u201cThat needs to change. I said I wanted to give people breathing space, and that\u2019s what I\u2019m announcing on my second day as Prime Minister. <\/p>\n \u201cWe\u2019re taking immediate action to cut taxes on energy bills, put more money in people\u2019s pockets and bring back hope.\u201d<\/p>\n However, the move has faced criticism from Darren Jones, formerly chief secretary to Starmer, who claimed the Digital ID programme was unfunded. He called on the government to “set out how it will pay for its new policies”.<\/p>\n Jones is not alone in his criticism of the policy, with consumer expert Martin Lewis saying “in practice people won’t feel much benefit”, particularly as the energy price cap is predicted to rise 3.1% in October, meaning the saving will be less noticeable.<\/p>\n There is also a gap in the required spending, with Digital ID expected to have cost \u00a3600 million, leaving the government \u00a3250 million short of the required \u00a3850 million to remove the VAT.<\/p>\n Conservative Leader Kemi Badenoch also expressed concerns, saying: “You can\u2019t use the funding from an unfunded programme to pay for cheaper bills.”<\/p>\n She suggested the government should “steal” her ideas to drill in the North Sea and scrap net-zero.<\/p>\n The policy announcement on Burnham’s first full day in office comes after the new premier promised to provide early \u201cbreathing space\u201d for households struggling with the cost of living as he stood on the steps of No 10 on Monday.<\/p>\n He said some of these measures would be announced as early as Tuesday, when he will chair his first cabinet meeting. <\/p>\n In his first address to the nation as prime minister, Burnham pledged the biggest change to British politics in 40 years, and said he would deliver \u201ca new political model and a new economic model\u201d for Britain.<\/p>\n