New government, new opportunity? Or just new faces, same old approach?

What Andy Burnham's administration could mean for REC members

Andy Burnham's swift arrival as Prime Minister following the Makerfield by-election and an uncontested Labour leadership contest, alongside the departure of Keir Starmer just two years after Labour's landslide election victory, marks a significant moment of change in British politics.

Burnham's subsequent Cabinet and Ministerial reshuffle has produced a markedly different Labour Government, with 14 new Cabinet ministers and several influential figures moving into new roles. While some key players remain, the changes signal Burnham’s determination to put his own stamp on government. It’s early days but the government is making some bold policy moves.

For REC members, the months ahead will be crucial. The new administration must now turn its rhetoric around growth and renewal into practical policies that support, employment and investment. Early signals suggest the Government will focus on tackling the cost of living, driving regional growth, supporting reindustrialisation and strengthening its partnership with business.

Burnham has already shown that he has a very different leadership style from his predecessor. Rather than spending Parliament's summer recess in Westminster, he will be travelling across the country to meet businesses, communities and local leaders as he begins shaping his Government's agenda. 

The REC is already engaging 

The REC has moved quickly to engage with the new Government. We have written to both the new Prime Minister and his Chief of Staff as well as other relevant Secretaries of State setting out the opportunities and challenges facing employers and offering our support as ministers develop their agenda.

We begin from a position of strength, having built a positive and constructive relationship with Andy Burnham during his time as Mayor of Greater Manchester.

Our correspondence have focused on two priorities: helping the Government deliver economic growth and seeing us as partners in that mission, while ensuring ministers understand the pressures facing employers, including rising employment costs, labour shortages, economic inactivity and weakening hiring confidence.

We have also reiterated the REC's longstanding position that agency work should be exempt from the proposed guaranteed hours provisions. Temporary work provides an important route into employment, particularly for young people and those furthest from the labour market, while giving employers the flexibility they need to respond to changing demand. We continue to make the case that applying guaranteed hours to agency work would create significant practical challenges without benefiting workers or employers.

Key Ministers to watch

Former Defence Secretary John Healey's appointment as Chancellor has attracted considerable attention.

Jonathan Reynolds' return as Business Secretary is particularly significant for employers. A longstanding ally of the Prime Minister, he now leads an expanded department covering business, trade and science and will play a central role in delivering the Government's growth agenda. Having previously held the role, he already understands the recruitment industry's priorities, and the REC has built a positive and productive working relationship with him.

Former Employment Minister Kate Dearden has also been promoted to Minister of State within the department. Given her previous engagement on employment policy, the REC looks forward to continuing a constructive dialogue with her, particularly on the implementation of the Employment Rights Act and its implications for employers and recruiters.

For the labour market, several familiar faces remain in key roles. Pat McFadden continues as Work and Pensions Secretary, placing him at the centre of efforts to reduce economic inactivity. Shabana Mahmood remains Home Secretary, while Yvette Cooper becomes Health Secretary, with responsibility for addressing workforce challenges across the NHS and social care.

Former Transport Secretary Louise Haigh has emerged as one of the most influential figures in Government as Chancellor of the Duchy of Lancaster and First Secretary of State, while Angela Rayner returns as Housing Secretary after previously playing a significant role in shaping the Employment Rights Bill.

What to expect

Many of the Government's flagship policies are still being developed. The Prime Minister has committed to publishing a Ten-Year Plan in the autumn, setting out his long-term vision for economic growth, public services and national renewal, while the first Budget will provide greater clarity on taxation, spending and business support.

In the meantime, several priorities are already emerging. Tackling the cost of living sits at the top of the agenda, with early announcements on ending homelessness alongside previously announced £2 bus fares and reported reductions in business rates for pubs and clubs.

Alongside this is a clear commitment to economic growth through reindustrialisation, greater devolution and stronger regional economies. Infrastructure investment, industrial strategy and local decision-making are all expected to feature prominently as the Government develops its programme. The Government has also reaffirmed its commitment to its fiscal rules, signalling an intention to maintain market confidence and provide a stable economic environment for investment.

For the REC, the priorities remain clear: a strong Industrial Strategy, investment in skills, action to reduce economic inactivity and labour market policies that encourage businesses to recruit and invest.

The challenge ahead

The Government inherits a difficult economic backdrop. Productivity remains weak, economic inactivity is high and many employers continue to face skills shortages alongside rising employment costs and increasing regulatory pressures.

The success of the new administration will depend on whether it can create the conditions for businesses to invest, recruit and grow. That means ensuring employment regulation, taxation and labour market reforms are practical, proportionate and support economic growth.

The REC stands will continue to push these messages to the government and build on the existing relationships as well as developing new ones for example with Yvette Cooper at Health and Social Care.  It certainly won’t be a slow summer for your REC Campaigns team!

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