Andy Burnham is expected to be appointed British prime minister on Monday, immediately moving to scrap his predecessor’s digital identity programme and redirect resources to cost-of-living relief, while signalling a possible U-turn on North Sea oil and gas drilling that has drawn a public endorsement from US President Donald Trump. British media reports, citing allies of the incoming leader, say he will also place the distressed utility Thames Water into a special administration regime as a step towards greater public control of the water sector.

The shift on energy policy remains ambiguous. Labour’s deputy leader Lucy Powell described the change as a “change of emphasis” that would not breach the party’s 2024 manifesto ban on new exploration licences. However, Trump claimed on social media that Burnham would “open up, all the way, the invaluable North Sea Oil”, and that the people of Aberdeen were “dancing in the streets”. Moscow, via Russian state media, portrayed the move as a corrective to what it called Britain’s “nightmarish poverty”. In the Middle East, Arab news outlets noted that Burnham intends to harden Britain’s stance on Israel, backing additional sanctions and trade restrictions on settlements—a departure from Starmer’s more cautious line that had already cost Labour support among left-wing voters.

Domestically, the incoming government faces immediate economic headwinds. Inflation is expected to have eased to 2.4 per cent in June on the back of falling fuel prices, but Ofgem’s 13 per cent energy price cap rise took effect in July, pushing average household bills to £1,862. Octopus Energy has publicly urged the new prime minister to overhaul electricity markets, estimating that reforms could cut bills by £114 a year. Meanwhile, the reported choice of Home Secretary Shabana Mahmood as chancellor is generating friction with Labour’s left wing, given her past behind-the-scenes criticism of tax rises introduced by the previous government and her opposition to wealth taxes.

Burnham inherits a country still grappling with the economic drag of Brexit, strained public finances, and a volatile relationship with the White House. He has pledged stability after a decade that has seen seven prime ministers. Formal handover proceedings at Buckingham Palace are set for Monday, with cabinet appointments to follow. The first hard economic indicator comes on Wednesday when June’s inflation figure is published, offering an early verdict on the room for fiscal manoeuvre. How the new government balances industrial pragmatism—symbolised by the North Sea debate—against its climate and fairness commitments will define its initial credibility.