Shabana Mahmood is being tipped to become Chancellor of the Exchequer under incoming Prime Minister Andy Burnham, with a key challenge being the management of welfare cuts and the ballooning Department for Work and Pensions (DWP) budget. Ms Mahmood, the Labour MP for Makerfield, is reportedly Mr Burnham's choice for the role after beating Ed Miliband to the position.
Mahmood's Task: Selling Welfare Cuts
According to reports, the "big question" for Ms Mahmood is the welfare bill and the rising DWP payments. She has been told she "needs to be someone who can sell cuts, as well as the work and pensions secretary" and must also "be able to come up with cuts that make sense and which are coupled with genuine reform, rather than eliding the two."
This would mark a stark contrast to Rachel Reeves' approach, which saw cuts to the Winter Fuel Payment. Ms Mahmood's role would require her to navigate the delicate balance between reducing spending and maintaining public support.
Timms Review and PIP Changes
Currently, a Timms Review—led by Labour Party cabinet member Sir Stephen Timms—is exploring changes to Personal Independence Payment (PIP). The outcome of this review will likely influence Ms Mahmood's decisions on welfare reform.
Isabel Hardman, an I paper columnist, commented: "Even if he does develop that underpinning, Burnham might find Mahmood isn’t that easy to run as a chancellor. She is a tough cookie, and that means she doesn’t like being pushed around. One of the reasons she has made a success so far of being in the Home Office is that she is, in the words of one admiring former colleague, 'very hard to work with'."
Addressing Neets Numbers
As well as PIP, Ms Mahmood must address a report from former Health Secretary Alan Milburn on the spiralling number of young people who are classed as 'Neets'—those not in education, employment, or training. Just over a million young people aged 16-24 are currently classed as Neets, a figure that has been rising.
Mr Burnham told The Times last month: "I am not squeamish about saying that the plan would be to reduce the welfare bill. Not at all." This signals a clear intention to pursue cuts, with Ms Mahmood expected to be the key figure in implementing them.
Mahmood's Reputation and Future Challenges
Ms Mahmood's reputation as a tough negotiator may serve her well in the Treasury, but it also presents potential friction with colleagues. Hardman noted that Burnham might find Mahmood "isn't that easy to run as a chancellor," suggesting that her strong-willed nature could lead to clashes.
The welfare bill remains a contentious issue, and Ms Mahmood's ability to sell cuts while ensuring genuine reform will be closely watched. With the Timms Review ongoing and the Neets report demanding action, her early days as Chancellor would be dominated by these pressing challenges.
