Electricity tax cut funded by scrapping digital ID plans
LONDON — U.K. Prime Minister Andy Burnham’s announcements during his first 24 hours in office — naming former Defense Secretary John Healey as chancellor of the exchequer and suspending the tax on home electricity — underscored the competing pressures he faces from voters and bond markets, the Associated Press reported.
Burnham, from Britain’s left-leaning Labour Party, faces restive voters seeking relief from the high cost of living. At the same time, investors who help finance the government by buying its bonds are demanding that he reduce public sector debt that has ballooned to levels last seen in the 1960s, according to the AP.
In an effort to balance those demands, Burnham surprised pundits by naming Healey, who served in the Treasury under former Prime Minister Gordon Brown, as his Treasury chief. Healey is seen as someone who will make sure the government lives up to its pledge to reduce Britain’s debt pile, the AP reported.
First thing Tuesday morning, Burnham made a down payment on his commitment to ease pressure on cash-strapped consumers. The government announced it would scrap the tax on home electricity use for at least six months beginning in October, saving the average household £45 ($60) a year, according to the AP.
The government said the move would be paid for by canceling plans to introduce digital ID, in an effort to reassure investors that Burnham is not about to go on an unfunded spending spree.
The early decisions underscore the political and financial challenges Burnham faces as he tries to jump-start the country’s sluggish economy.