Stories

Mon, 18 May 2026

Mon, 18 May 2026 Faisal Islam: Burnham seeks to calm markets by committing to fiscal rules

Greater Manchester Mayor Andy Burnham is looking to manage the markets as well as the Makerfield byelection

* Greater Manchester Mayor Andy Burnham has committed to sticking to the government's existing borrowing limits (fiscal rules)
* Markets reacted positively, with UK 10-year gilt yield falling back
* Burnham had previously suggested changing the fiscal rules to allow for extra spending
* The International Monetary Fund urged the UK to stick to the fiscal rules, which limit how much the government can borrow and require debt as a share of national income to fall by 2029
* Some think tanks and Labour supporters have proposed changes to the rules to allow for extra investment spending, but this would require waiting years until a surplus is achieved
* Burnham may face tough choices on tax or other areas of spending if he sticks to the existing rules
* Conservative shadow chancellor Mel Stride warned of a "Burnham penalty" if Labour's plans to change the fiscal rules are implemented
* Chancellor Rachel Reeves defended sticking to the fiscal rules, arguing they provide stability and confidence for government bondholders.