New UK PM Andy Burnham axes Starmer allies in ruthless first Cabinet reshuffle

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What Andy Burnham’s new-look Cabinet tells us about Britain’s direction

A big Cabinet reshuffle under the incoming PM yielded some surprises — and opened up some potential new Westminster dramas.

By SAM BLEWETT

in London

Newly appointed Chancellor John Healey leaves Downing Street in London as new Prime Minister Andy Burnham names his Cabinet on July 20, 2026. | Dan Kitwood/Getty Images

Britain’s new Prime Minister Andy Burnham wasted no time Monday showing that there is much more to him than the friendly, folksy image he’s cultivated in public by swiftly banishing Keir Starmer’s closest allies from the Cabinet.

The former mayor gave pure Westminster with his ruthless first acts in the job, a reminder that, as one of his big supporters told POLITICO last month , inside is a “cold-hearted lizard of a politician.”

During a round of telephone sackings, Starmerites from Chancellor Rachel Reeves to Deputy Prime Minister David Lammy were demoted all the way to the backbenches. In their stead, Burnham is forming a top team spanning the mainstream wings of the party, including key northern allies and ministers who fell out with Starmer.

Here’s who’s up, who’s down and who’s made a lateral move.

The winners

The biggest surprise was John Healey becoming chancellor. The second-most-important job in government was a big reward for the MP whose resignation as defense secretary a little over five weeks ago ensured there could be no chance of Starmer fighting on.

Healey will insist that he quit purely on principle over how the Starmer administration was failing to sufficiently increase defense spending in a perilous world. But that resignation also came with a barb about the “unwilling” Treasury he now commands.

Angela Rayner, who is the new housing secretary, rings the doorbell as she arrives at No. 10 Downing St. in London on July 20, 2026. | Dan Kitwood/Getty Images

He will have to fill the multi-billion-pound holes in government spreadsheets created by the Defence Investment Plan that was ultimately agreed after he quit, and work out how to facilitate the major hike in defense spending to 3 percent of GDP by 2030, as he demanded. To tax more or to cut existing budgets? That is the question.

For now, he will be seen as a safe pair of hands with experience across government, including in the Treasury back in Tony Blair’s administration in the 2000s. Burnham will hope he’s sufficiently safe not to spook the bond markets, which have at times been jittery about the prospect of this new PM.

One No. 10 official insisted Burnham and Healey have the “same outlook” when it comes to re-industrialization, devolution and the cost of living — key planks of Burnham’s plans — as well as the need to stick with the government’s “fiscal rules” aimed at securing economic stability.

Ed Miliband is now Britain’s top diplomat. One of Labour’s former leaders, who failed to win a general election in 2015 , he had been an ally of Starmer — until he refused to be reshuffled out of the energy secretary brief.

He then became one of the first members of the Cabinet to tell Starmer he should quit. Now he is Burnham’s voice to the world.

The new boss wants to focus relentlessly on the domestic. So, having a big figure from Labour’s left in charge of the foreign brief could help smooth that ride.

Ed Miliband and Shabana Mahmood, who had both been strongly tipped to become chancellor, arrive in Downing Street together on July 20, 2026. | Ryan Jenkinson/Getty Images

Then again, Miliband will have to lead relations with the White House. Moving Miliband out of the energy role may open a pathway for Britain to do a little more extraction of oil and gas in the North Sea. But his credentials as an environmental champion are unlikely to endear him to Donald Trump, who has repeatedly encouraged Britain to drill for North Sea oil.

And Miliband has already proved, repeatedly, to be a thorn in America’s side. While leader of the opposition in 2013, he successfully blocked the British government from taking part in military action in Syria, complicating the picture for Barack Obama .

He was also a leading voice in privately pushing for Britain not to let Trump use the Indian Ocean base on Diego Garcia for offensive strikes on Iran earlier this year. That, too, may not endear him to the U.S. administration.

Miliband’s statement on entering the Foreign Office noted how his parents came to Britain as Jewish refugees from the Nazis. In it he also pledged to work “tirelessly” to seek a sustainable peace between Israel and its neighbors. It will remain a tough topic for Labour to manage.

Miliband strode up Downing Street side-by-side with Shabana Mahmood in what seems to have been a strange coincidence. Westminster observers had seen them both as shoo-ins to be chancellor in recent weeks.

Mahmood’s allies had always insisted she wanted to stay in the Home Office to continue pushing through the immigration reforms that are contentious with many progressives.

Wes Streeting arrives at Downing Street on July 20, 2026 before he was named defense secretary in the new Burnham Cabinet. | Ryan Jenkinson/Getty Images

She’ll get her wish, with Burnham keeping her in the post of home secretary. But one of her allies, like others in this article granted anonymity to speak frankly, predicted to POLITICO in recent weeks that there will likely “have to be some sort of sop to the soft left” when it comes to immigration reforms.

Like Miliband, Mahmood was an early mover in telling Starmer his time was up. And like Miliband, that she did not get the job of chancellor shows glaring faults with the “insidious briefing culture” in Westminster that Burnham has vowed to end.

Last week, trusted newspapers ran articles with little caveating that she would lead the Treasury, thanks to the murmurings of figures linked to Burnham. Now journalists in Westminster are re-examining how they will cover this administration.

And Miatta Fahnbulleh will replace Miliband as secretary of state for energy security and net zero.

The former energy minister and think tank chief has been advising Burnham on policy . She served as a junior energy minister, then communities minister, before becoming the first to resign in May to pressure Starmer to quit.

Now she will lead DESNZ, the department tasked with securing the U.K.’s energy supplies in an increasingly volatile world; with bringing down the cost household and business energy costs (a major drag on U.K. growth); and with keeping the U.K. on course to meet its legally binding climate goals.

Her department could be center stage on Tuesday, with Burnham expected to announce new measures to give voters immediate “breathing space” on cost of living pressures. Two people briefed on plans, granted anonymity to speak candidly, said a cut to the 5 percent in VAT charged on household electricity bills could be among the policy pledges.

Burnham has vowed to end factionalism. But there are plenty of signs that helping him prize Starmer from power has rewards. Wes Streeting , who indicated earlier this year he intended to challenge Starmer for the top job, will instead become the U.K.’s new defense secretary , Downing Street announced late Monday.

Streeting takes over less than six weeks after predecessor Dan Jarvis, who was appointed amid a fierce row within government over defense spending, was appointed to the job by Starmer. Streeting has made several interventions on defense spending, endorsing the idea of “war bonds” to raise money and arguing for the scrapping of outdated military programs .

He has, however, never held a foreign-facing brief and would face skepticism from those who believe the ministry should ideally be led by a veteran.

MPs spurned by Starmer make comebacks

Louise Haigh was a rebel ringleader who secured a humiliating U-turn from Starmer over his botched welfare reforms after she was forced to resign from his government. She then masterminded Burnham’s Makerfield by-election campaign.

Now Haigh holds two titles that are only matched in being a bit of a mouthful by the power and influence they hold. She will lead the Cabinet Office as chancellor of the Duchy of Lancaster and first secretary of state — putting her first among Cabinet ministers.

Newly appointed Secretary of State for Digital, Culture, Media and Sport Lisa Nandy departs Downing Street on July 20, 2026. | Ryan Jenkinson/Getty Images

The leading light of Labour’s “soft left” will now be in charge of pushing through Burnham’s vision of greater public control of key utilities and helping devolve power from Westminster.

On that aim she will be working closely with Angela Rayner — another northern MP who had to resign from Starmer’s Cabinet under a cloud. Rayner has settled her tax affairs and is back as housing secretary.

Lucy Powell was sacked in a reshuffle by Starmer, only to humiliate him by winning the election of party members to replace Rayner as deputy Labour leader. A close ally of Burnham, she rejoins the cabinet as education secretary.

Yet another Manchester MP, Jonathan Reynolds , returns to his old gig of business secretary. It was a job he happily served in under Starmer until he was made chief whip. He did little to hide his disappointment at that reshuffle.

Reynolds is replaced in that key role enforcing discipline and scoping support among Labour MPs by Anneliese Midgley , another one of Burnham’s so-called “Northern Queens” — the women who helped run his by-election campaign. The former trade unionist is seen as having broad popularity across Labour MPs and escaped much of the factionalism of the last decade.

To the reforming pastures

One loser of the reshuffle is Yvette Cooper . She was demoted from foreign secretary to health secretary, though that is set to become a much more politically high-profile role as Burnham has pledged to expend political capital by trying to reform Britain’s expensive and ineffective social care system.

Like Cooper, Pat McFadden is a Starmer ally who has survived the cull. And he also has a big reforming brief in store. By keeping McFadden on as work and pensions secretary, Burnham is signaling he really is serious about getting to grips with Britain’s welfare problem.

And Lisa Nandy will stay on as secretary of state for digital, culture, media and sport — a title that adds digital responsibility. This comes at Burnham vows to wind down the Department for Science, Innovation and Technology.

Kanishka Narayan , who became an MP in the 2024 election and had overseen AI policy as a junior minister, is now AI minister — a role that will report to both the Cabinet Office and DCMS and involve attending Cabinet meetings — a step up from his previous job.

Esther Webber, Mizy Clifton and Charlie Cooper contributed to this report.