Lord O’Neill turns down role in Andy Burnham’s team

Former Goldman Sachs executive and ex‑Treasury minister Lord Jim O’Neill has turned down a senior economic post in the administration of newly elected Andy Burnham, the Labour leader who became prime minister last week.

The decision hits Burnham at a delicate moment. He is still building a team of heavyweight advisers to steer the upcoming Budget, a litmus test for his credibility with markets and the business community.

“It’s not because of any policy disagreements. I’m a massive fan of the focus on devolution and I hope Andy and his team will be bold on this and everything else,”

O’Neill told the Financial Times that he enjoys his current private‑sector roles “too much” and does not want to place his assets in a blind trust, a requirement for senior public office. He said the choice was personal, not a clash over policy.

Economic expertise in short supply

O’Neill was one of three senior advisers reported to be courting Burnham before his election as MP for Makerfield. The other two, former Office for Budget Responsibility chair Richard Hughes and ex‑Bank of England chief economist Richard Hughes, have also stayed out of formal government roles. Former Bank of England deputy governor Minouche Shafik recently left Number 10, and other long‑standing economists such as John van Reenen and Anna Valero are no longer on the official council that supports Chancellor John Healey. Only Neil Amin‑Smith, a former Treasury adviser to Rachel Reeves, has been retained as an economic adviser to Burnham.

What lies ahead for the Budget

With the Budget only weeks away, Burnham faces pressure to present a growth‑friendly plan while the UK grapples with a protracted Iran conflict, slowing growth and rising interest‑rate concerns. Analysts say the £22.7 billion fiscal headroom identified in March has likely eroded, but some economists argue Healey can keep taxes steady without jeopardising public finances. Nonetheless, the need for additional spending on cost‑of‑living measures and defence could force a tax‑rise debate, a scenario that would be harder to defend without a marquee economist on the team.

For now, Burnham will have to lean on the remaining advisers and his own political capital to reassure markets that the UK’s economic policy remains on a steady course.