Andy Burnham Set to Become UK Prime Minister as Markets Watch Cabinet Picks

The transition of power follows the resignation of Sir Keir Starmer, who stepped down last month amid a series of policy U-turns, staffing controversies, and significant losses in local elections. Andy Burnham, who returned to Parliament recently after winning a by-election in the Makerfield constituency, will head to Buckingham Palace this morning to be formally asked by King Charles to form a government.

Market Reactions and Cabinet Appointments

Investors and market analysts are closely monitoring Burnham’s first moves, particularly his choices for key cabinet roles.

Despite this, there remains underlying tension regarding the new government’s spending plans.

Donald Trump’s Intervention on North Sea Energy

U.S. President Donald Trump has taken a vocal interest in the incoming administration, specifically regarding potential changes to energy policy. In a message shared on Truth Social, Trump lauded reports that Burnham might move to increase oil and gas exploration in the North Sea. As the Express reported, Trump claimed that such a move would transform the UK from a Poverty Stricken Disaster, to one of the Richest Countries anywhere in the World!

For more on this story, see Andy Burnham Set to Become UK Prime Minister Following Starmer Resignation.

Trump further claimed that residents of Aberdeen were dancing in the streets over the prospect of new drilling, according to the Mirror. Additionally, the President criticized the presence of wind turbines near Aberdeen, labeling them old and horrible looking and suggesting the government should move them.

Policy Ambiguity and the 2024 Manifesto

While Trump’s comments have generated significant attention, the reality of Burnham’s policy remains more nuanced. Labour’s 2024 manifesto included a pledge not to issue new North Sea oil and gas licences. However, sources cited by dailymail.com suggest the incoming Prime Minister is open-minded about the policy and believes he could support further activity in fields like Rosebank and Jackdaw—where licences were previously granted—without technically breaching manifesto commitments.

This follows our earlier report, Andy Burnham Set to Become UK Prime Minister With Bolder Growth Agenda.

Labour’s deputy leader, Lucy Powell, has characterized the reports as speculation. As the Express and Metro noted, Powell emphasized that the incoming government would likely adopt a more pragmatic approach rather than a total policy reversal. She stated, I don’t think it’s a change of policy. It’s more a change of emphasis.

Read also: Andy Burnham Becomes UK Prime Minister Facing Severe Economic Constraints.

The Road Ahead for the New Administration

Burnham’s ascent to power marks a shift for the Labour Party. Known as the King in the North during his time as Mayor of Greater Manchester, Burnham has signaled an intent to address significant domestic issues, including social care policy.

As he assumes the premiership today, Burnham faces the immediate task of managing both his own parliamentary party and the expectations of international partners. While the market currently appears fairly relaxed about his agenda, his first speech as Prime Minister will likely be scrutinized for further clarity on how he plans to balance economic growth with the party’s previous environmental commitments.

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Update (July 21, 2026)

According to telegraph.co.uk, Lord Timpson has resigned as prisons minister hours before Mr. Burnham began choosing his Cabinet. Lord Timpson, who was appointed in July 2024, had been overseeing legal changes scheduled for September that allow thousands of prisoners to be freed after serving as little as a third or half of their sentences.

Labour is facing a growing backlash from victims and backbench MPs, including former Home Office minister Jess Phillips, regarding the failure to exempt rapists and child sex offenders from this early release scheme. Sources close to the new Prime Minister confirmed that he and his team are currently exploring how to tighten the scheme to prevent these specific offenders from walking free this September.