Key facts
- Economists including Lord Jim O’Neill and Andy Haldane have reportedly declined advisory roles with Andy Burnham.
- Disagreements over potential wealth taxes are the primary reason cited for their refusal.
- O'Neill is reportedly still in talks but has not joined due to his stance on wealth taxes and desire to oversee business interests.
- Some Labour MPs have called for a 2% tax on assets over £10 million, while others favor equalizing capital gains and income taxes.
- Andy Haldane has expressed that tax hikes should not be treated as a 'cash cow'.
Prominent economists have reportedly shunned advisory roles with Prime Minister Andy Burnham due to disagreements over potential wealth taxes. Lord Jim O’Neill, a former Goldman Sachs executive, and Andy Haldane, ex-chief economist at the Bank of England, are among those who have opted not to join Burnham's government, according to fresh reports.
O’Neill is said to be in ongoing talks with Burnham but has not yet taken a role, citing his dislike for a potential wealth tax and the Prime Minister's failure to rule out such a policy. He also reportedly wishes to retain oversight of his business interests.
Before Burnham's premiership, O'Neill, Haldane, and former Office for Budget Responsibility chair Richard Hughes were widely reported to be advising him. Their reported proximity to Burnham had been credited with soothing investors' nerves. However, City AM revealed last week that none had taken official roles a month into the new premiership.
Burnham has reportedly kept Neil Amin-Smith, an adviser to Rachel Reeves, to assist with economic policy. The situation leaves Burnham lacking the economic expertise that his allies had previously highlighted.
Within the Labour party, there are differing views on taxation. Several backbenchers have urged for increased taxes on the wealthy, with some calling for a 2% tax on assets exceeding £10 million. Others, including figures from the Labour Growth Group, advocate for a wealth tax that equalizes capital gains taxes with income taxes, while allowing for investment incentives.
Andy Haldane has previously stated that tax hikes should not be used as a 'cash cow'. The absence of a dedicated economic advisory team ahead of the Autumn Budget and ongoing tax debates highlight underlying divisions within the party.