The nine contenders to be Burnham’s chancellor

Andy Burnham is the new MP for Makerfield and is well on the way to becoming the new prime minister. Much blood may need to flow under the bridge first, but few in Westminster doubt the inevitability of his ultimate elevation to No. 10.

Which raises key questions about what he will do, and how he will convince the wicked Bond villain markets to go along with it. Key to that will be the identity of his chancellor of the exchequer, who will have to find money for Burnham’s pet projects and prevent the collapse of the pound and an explosion in the cost of borrowing.

Today I’m in receipt of information from a source who has had extensive interactions with multiple members of Burnham’s inner circle, which reminds me of that wonderful moment in Blackadder Goes Forth where the British agent under cover in the hospital, who has gone a bit native behind the lines, is asked whether he has seen any likely German spies and says: ‘Nein!’

‘Nine?!’ comes the reply.

Insiders say a whopping NINE people are in the running to become Burnham’s chancellor, and I can name eight of them. Westminster is assuming that it is a done deal for Ed Miliband, who is desperate to return to the Treasury after his years of advising chancellor Gordon Brown, but that isn’t quite the case. Some claim the man Ed has to beat is someone much less high-profile. Here’s my list of names in the running: 

Champions League Contenders

1. Pat McFadden

The Work and Pensions Secretary is the ultimate safe pair of hands. A dry-as-dust Blairite who was caught moaning to Peter Mandelson about having to drum up ever more cash for welfare increases, he would be a credible figure to rein things in. Would not be popular with the left, but would buy Burnham space with the markets.

2. Ed Miliband

The Energy Secretary is the overwhelming choice of the soft left and he not only wants the job, he regards it as his due for leading the cabinet charge to get Starmer to name the date of his departure. Labour right-wingers recall Miliband’s desire to make work pay more than welfare under Brown and hope he would not just be a boilerplate lefty, but his Net Zero zealotry will get in the way of some changes Burnham might need to make. If he doesn’t get it, his eyes will be sadder than Burnham’s.

3. Darren Jones

A former chief secretary to the Treasury, Jones was also embarrassed by his messages with Mandelson but is always agitating for promotion. His appointment would not bring universal joy to colleagues.

Mid-table mediocrity

4. Wes Streeting

The recently departed health secretary spoke to Burnham on Monday. He says he has the numbers to force a contest, but most MPs think he’ll do a deal for a good job – and jobs don’t get better than this. More credible than some with the markets but would a new PM really put his biggest rival next door?

5. Shabana Mahmood

The runaway choice of the Labour right, which correctly regards her as the government’s most able minister, and a rock-solid reassurance to the City. She actually believes in cutting some areas of spending. Mahmood was also Burnham’s likely ‘unity’ pick but the Home Secretary wants to stay where she is to finish the job of reining in migration. Her withdrawal has opened the door for McFadden as Miliband’s main rival.

6. Yvette Cooper

The Foreign Secretary is a former leadership candidate (who was discreet enough to finish behind Burnham in 2015) and is seen as a sober and serious figure. She is privately urging Burnham and Starmer to be respectful of each other, which translates to urging the PM to name the date. She also has one of the better backroom teams in Whitehall and many would pay good money to see her adviser Damian McBride, Labour’s canniest operator, back in the Treasury.

Battling relegation

8) Rachel Reeves

The Chancellor keeping her job is seen as the last-but-one resort. She would be a roadblock to sorting out defence spending or changing direction on tax. To stand any chance she would need to break cover and call for Starmer to go.

9) Torsten Bell

The former thinktank head and current pensions minister has a brain the size of a planet and an ego to match. Credible but young and about as popular with his colleagues as a dose of the clap in a whorehouse. Nonetheless, seen as the final credible contender, which will please him more than this write-up.

(If you know who the 7th contender is, do get in touch.)

What Makerfield means

You can’t move for reaction to the Makerfield result, which looks set to be the most consequential by-election we’ve ever seen (and the Tory triumph in Aberdeen South, the first Conservative by-election gain in Scotland since 1967).

Burnham is setting out his national agenda, Starmer says he’ll fight any leadership challenge: MPs are beginning to call publicly for him to go, while ministers like Miliband and Mahmood do so privately. Next week Starmer and Burnham will talk and the pressure on the PM to go quietly will be crushing. In the meantime, here are seven things we learned today:

i) Burnham will have even less money to spend than Starmer: The UK government borrowed £23.3 billion last month, 30 per cent or £5.4 billion more than a year earlier. It was also more than the £18.8 billion expected by most economists and the £17.7 billion forecast by the Office for Budget Responsibility. The interest payable on government debt rose to £11.7 billion, the highest recorded in any previous May. News of Burnham’s win drove up the cost of gilts further. He needs to get that chancellor pick right.

ii) Reform had a bad night: Yes, they increased their vote share from the 2024 general election, but Reform’s 36 per cent was 15 points down on their performance in the local elections in the same area just six weeks ago. They have now lost five by-elections they might have hoped to win. They are also becoming the major casualty now that…

iii) Tactical voting is endemic: In the 2024 general election, the Tory, Lib Dem and Green vote in Makerfield totalled 22 per cent. Last night they collectively won 3 per cent. Even some Tories seem to have loaned their votes to Burnham to kill Reform’s momentum and encourage Starmer’s removal. In Aberdeen, the Tories were the beneficiaries not just of the SNP’s opposition to North Sea drilling, the economic lifeblood of the town, but of tactical voting by other unionists against the nationalists. Particularly worrying for Reform is that the driving motivation of many voters is: ‘Who do you hate most?’ For a long time that has been Keir Starmer, the most unpopular prime minister since records began. But there is now considerable evidence that, for a lot of voters, the chief bogeyman is Nigel Farage.

iv) Burnham could unite the left: Labour has been leaching votes to the Greens, who won in Gorton and Denton, but they were all but wiped out down the road in Makerfield. Burnham has made a plausible case that he can get some of these voters to come home.

The next general election looks set to have dozens of different battlegrounds between different combinations of parties

v) Farage is struggling to unite the right: No one wants a pre-election pact between the three parties on the right. But they are eating each other’s lunch. Rupert Lowe’s Restore Britain underperformed its local poll ratings in Makerfield, and even had every Restore voter backed Reform, Burnham would still have won by more than 10 points. But the 6 per cent for Restore is a serious dent in Farage’s backing and could badly hurt his chances of winning the next election. That explains why his post-Makerfield message (filmed in a field) was to beg Restore voters to return. Optimistic Tories believe Kemi Badenoch can find a way through to emerge as the larger party on the right.

vi) British politics is now a series of by-elections: The next general election looks set to have dozens of different battlegrounds between different combinations of parties. The Tories won Aberdeen South but got a paltry 2 per cent in Makerfield. The Lib Dems win a lot of council by-elections and could build on their 72 seats in parliament, but Makerfield was their worst-ever by-election result. What matters is which party is the lead contender in the left or right bloc. Parties which are frontrunners in one place will be irrelevant elsewhere.

vii) We may already be at Peak Andy: Burnham is easily Labour’s most popular politician with voters, members and MPs but his approval rating dropped by 15 points in Makerfield during the campaign on the back of a series of U-turns. The more he clarifies his policy platform the more likely he is to upset some voters.

Have a good weekend. It’s likely to be nicer than Keir Starmer’s.