Labour civil war intensifies as Burnham pitches leadership and Starmer likens him to Liz Truss

LONDON — A row within Britain's Labour Party intensified on Thursday after Manchester mayor Andy Burnham publicly signaled a potential leadership bid, prompting Prime Minister Keir Starmer to liken him to former Conservative prime minister Liz Truss. Burnham’s sharp critique of the party leadership accused Prime Minister Starmer of creating “alienation and demoralisation” within Labour as the party edges toward its annual conference in Liverpool. He argued for a more aggressive policy stance and made clear he would not speak in code about the party’s direction as he outlined what looked like a left-leaning platform.

In a series of interviews, Burnham said a number of MPs had contacted him to urge him to run, and he did not rule out a tilt at the top job. He promoted a left-wing agenda that included borrowing to fund nationalisation of housing, proposing around £40 billion in borrowing to kick-start such a programme. He also insisted that the UK should not be “in hock” to bond markets, a stance that sparked a backlash from investors who warned it could undermine fiscal credibility. Burnham’s allies stressed that he would focus on his mayoral role while leaving the door open to a potential bid. The comments drew strong reactions from Labour figures allied to Starmer, with Housing Secretary Yvette Cooper’s successors and Chancellor Rachel Reeves stressing discipline and focus on delivering change in Greater Manchester.

Burnham’s remarks also prompted alarm among investors, with warnings that a government led by him could spark a sell-off in gilts if he pursued a rapid borrowing spree. Mark Dowding of RBC BlueBay Asset Management told the Financial Times that his comments reflected “financial naivety” and warned that market confidence would quickly sour, with higher yields and potential pressure on the pound. Economist Paul Johnson, a former director of the Institute for Fiscal Studies, echoed that bond markets are made up of lenders to the government, implying that aggressive borrowing could invite swift market pushback. The Financial Times noted a broader concern among market participants about how a Burnham-led administration would manage public debt and fiscal rules.

Starmer responded by drawing a stark contrast between Burnham’s approach and a fiscally prudent path, saying there was “nothing progressive” about borrowing more than necessary or abandoning fiscal rules. He invoked the memory of Liz Truss’s 2022 policies to warn that deviating from fiscal discipline would harm ordinary working people. Truss herself responded on X, saying Burnham should be “so lucky” to be compared to her, though Starmer’s camp pressed on with the message that controlling debt and ensuring responsible fiscal policy remains essential to Labour’s credibility.

The row spilled into the political arena beyond Labour’s own ranks: a Tory leadership figure, Kemi Badenoch, asserted that Starmer was “in office but not in power,” arguing that Burnham’s public campaigning suggested internal divisions within Labour’s leadership. Burnham, for his part, insisted he loved his role as mayor and declined to discuss a hypothetical bid, saying he was not in the business of answering hypotheticals. To mount a parliamentary bid, he would need to win a seat in a by-election and secure support from roughly 80 Labour MPs, a threshold viewed as formidable given the party’s current parliamentary balance and leadership constraints.

Polls by More In Common suggested that Labour could overtake Reform UK if Burnham led the party, underscoring the high stakes of his potential candidacy as Labour approaches its Liverpool conference. Burnham reiterated his preference for focusing on Manchester while leaving open the possibility of national leadership if circumstances aligned, indicating that the outcome would hinge on internal party dynamics and the wider political environment ahead of the conference.

Observers note the episode highlights how internal party rivalries over fiscal policy can become flashpoints for market sentiment and political risk in major democracies, a dynamic that international audiences, including U.S. political analysts, watch closely as part of broader assessments of fiscal credibility and leadership stability.