Blain’s Morning Porridge 30^th, September 2026 – Burnham’s Britain? Well, it’s likely to better than the Farage alternative…

“There is a big difference between presenting a plan and then executing it.”

What should markets be thinking about Andy Burnham’s conference speech yesterday? Gilts look to be giving him the benefit of doubt. Good in parts? He spoke well, proposed some positive policies and ideas, and gave an impression of a confident, positive politician set to deliver. The real issue isn’t just can Labour hold the nation steady and reverse years of negativity and low growth, but can any of the other parties do any better given the constrained state of the national finances?

LINK TO PODCAST

Key Takeaways:

• Andy Burnham has offered a credible political programme that didn’t scare the horses or the Bond market. The perception of the UK’s credit in bond markets required confidence and competence – which was delivered. Now they wait for execution.
• Burnham’s appeal is not universally attractive, but on a relative basis the party is betting he’s a better choice than the alternative for the Gilts Market and the electorate; Reform and Farage.
• Labour has already wasted half its parliamentary life under Starmer – Burnham has to persuade voters he can deliver his promises post next-election. (He’s said he won’t call an early election – making it distinctly possible he will.)
• His policies on care, housing, privatisation and Europe are positive, but there was nothing on creating growth, resilience and defence – which shows a lack of connective thinking.
• The UK’s political and fiscal credibility remains very much tied to keeping the bond market happy through adherence to the rules and restraining spending. The big challenge will be selling tax-rises to the electorate – they aren’t alternatives.
• Stability is not nailed on. There is a significant risk that Labour MPs mutiny over tax, pensions and any welfare cuts.

What should the markets be making of UK Premier Andy Burnham’s speech to the Labour Party Conference, setting out his stall and vison for Britain yesterday? Confidence is everything, and Burnham wields it with… aplomb. The Gilts market didn’t scream in horror or run away. The 10-year was marginally weaker on the day, but stronger post his comments – which came even as stalled negotiations on Iran pushed oil higher and fears of a US export ban on Diesel hangs over higher inflation.

You can tell Burnham scored big points in the great game of UK Politics. As evidence take a look at the Torygraph IMFReference Index for strongest signal of how good the speech was.

The IMF index ( {IMF UK Index <go> GP} on BBerg ), is the number of times writers or commentators in the Torygraph Newspaper cite the expression “IMF Bailout” while dismissing Labour as incompetents. It counts double if they write “imminent” IMF Bailout or anything along the lines of: “the chancellor has bought tickets to visit Washington for a chat with the nation’s bank manager at the IMF”.

Oh, these Telegraph journalists… oh so amusing they are.

Regular readers will know I make a point of reading the Torygraph first every morning – to know what the enemy is thinking. Buried among some actually quite good and interesting stuff, it’s important to know just what kind of misinformation the Russian Troll-farms are feeding their fake news and social-media shills here in Blighty. Undermining the finances of the UK with false and malicious lies expressed as irrefutable facts (like an IMF Bailout) is as important to Moscow’s war effort as knowing where the undersea cable nodes are.

(The story of the IMF bailout is one from a dimly remembered and distorted past. Most of the Gammons citing it this morning would have been annoying children in 1976, but with the usual 5 minute memory of the UK chattering classes they will have forgotten how a recently elected Labour government, facing an acute balance of payments crisis inherited from previous governments, went to Washington for a loan, which was enough to calm the crisis and was promptly repaid. Embarrassing but practical.)

This morning, the black-shorts/black-balaclava Gammons of the Reform right-wing are in full puffed-up, red-faced, angry mode and wielding IMF Bailout with furious abandon. Just about every second comment and article in Torygraph says such an IMF bailout is now inevitable. As Labour’s electoral popularity moves as the direct inverse of the IMF Index – Reform are worried… very worried.

If Burnham keeps performing this well, then he looks increasingly electable! Especially when Nigel Farage, his circus of fellow travellers of dubious provenance, and the tide of crypto money enveloping him, is now revealed in his true colours – red, white, blue a recently sick shade of green clown make-up.

The Conservatives, bless their little cotton socks and despite my personal liking for Kemi Badenough, just aint paid their dues for the 14 years of Cameron, May, Boris, Truss, and whatshisname’s dither. The Liberals? (When that’s the answer, it must be a bloody stupid question.)

Although Burnham might just be the best choice from a pretty uninspiring bunch, let’s not pretend Labour are God’s gift to the UK economy…

But… tis a pity Burnham hadn’t given us his list of things that must be fixed in the UK way back in July 2024 – before Starmer, the great vacillator, plunged the UK into a wasted 2-year black hole of political indecision and a woe-driven feedback-loop. Half a parliament has now passed, and Burnham knows a better UK now is undeliverable – which is why most of it his promises are for post-2029 and have been crafted to appeal to the Liberals and Greens for coalition support if a hung parliament is the (likely) result.

The question for the Gilt Market is simple – will Burnham’s speech make the UK any more stable? Will it increase the likelihood of political decisions delivering positive outcomes? Will it make the UK’s debt burden is more sustainable and therefore its ability to make prompt repayment of interest and principal (the only thing Gilt buyers worry about) more likely?

And let’s be honest about the speech. I heard nothing about the UK’s immediate crisis – the underfunded armed forces and the importance of building up national resilience in the face of the mounting Soviet Russian Threat. I worry Burnham has been too long “Oop North” and doesn’t understand there is a big, nasty world out there, with very sharp, pointy-toothed predators than will swiftly gulp down small nations given half-a-chance. I read nothing about how encouraging investment into the SME defence and Mil-tech sector could create substantial growth.

What I did hear were the bare bones of much needed care-reform, and a nod to the importance of housing security to get young people into work. He was honest about the failure of Labour governments to reform the NHS – and his care plan is a step in the right direction. He’s being “courageous” (which means potentially career limiting) on ending the Triple Lock on Pensions… but needs must. The money has to come from somewhere, and that somewhere should not be the bond market. Taxes will rise… not because Labour want to destroy the economy, punish the people or kill business, but because the last 40 years of bad government means they have to rise to pay for the mistakes of the past…!!!

And Burnham is right about privatisation – it’s been a disaster, an ideological imperative that was about as effective for the UK economy as the Cultural Revolution was for Chinese waistlines. Any smart financier knows that owning a monopoly asset is risk-limited and an opportunity to reap windfall dividends – which is exactly what happened: underinvestment, enshitification for consumers, and massive returns to the private owners. Burnham is going to give the private sector a chance – by allowing public/private competition. Answers on a postcard on how that will work out please.

Europe will be the big challenge. On paper reversing the mistakes of Brexit, finding a new accommodation, and not being terrified of dealing with France, Germany and the rest, while embracing commonality with them (especially in Defence) makes loads and loads and loads of sense. The problem will be whatever dark hole of political mayhem populist right-wing parties take France and Germany down in coming years. Again, the Russians are smiling.

The answer to my question on whether markets should be positive is a hedged yes. Everything Burnham and his Chancellor, John Healey, say is carefully weighed, measured and designed to reassure the Gilts market that the UK is sticking to its debt workout plan. They understand maintaining the confidence of the bond market in the UK – especially in today’s high inflation-risk environment is critical. If they were to promise to slash welfare spending and caused the government to collapse as Labour MPS rebelled – then that would be a death-knell for gilts.

Had Burnham done a Liz Truss, torn up the Treasury rules and cited unique circumstances requiring unique spending and tax-cutting measures to fund guns and butter (defence and welfare) … then we’d be looking at 5.75% on the 10-year Gilt… and rising.

Will things get better because Burnham looks and sounds like a real politician? He came over with passion, vision and political honesty. So did Margaret Thatcher, Tony Blain, Gordon Brown, David Cameron and even Rishi Sunak, all of whom – to a greater or lesser extent – appeared to believe in something. Burnham might be overly optimistic, and politically misguided (and I know many readers consider him a dangerous cloth-cap, black-sausage eating exponent of Northern Ecky-Thump Socialism…)

I simply suggest you do a simple exercise: Compare and contrast Andy Burnham with Nigel Farage and then put on your Gilt Market rational hat.

It’s not really a contest… is it. Britain faces difficult choices in coming years. Nigel is not one of them.

Out of time and back to the day job…

Bill Blain

Author of the Morning Porridge
CEO Windshift Capital
Advisor – Spitfire Strategic Capital

Meanwhile, don’t forget about my new book: The Battle for Hamble

You can read a review on the Society of Professional Economist’s website here.