Burnham's Cabinet bloodbath kicks off as 'disappointed' Steve Reed is axed - and swipes that he will be 'loyal' unlike the new PM

By JAMES TAPSFIELD, UK POLITICAL EDITOR Published: 15:46, 20 July 2026 | Updated: 15:58, 20 July 2026 Andy Burnham kicked off a Cabinet bloodbath today as he axed Keir Starmer loyalists David Lammy, Steve Reed and Peter Kyle. The new PM has started reshaping his team after admitting in his first speech to the country that the Labour Government 'needs to be better'. Mr Reed said he was 'disappointed' to be going from his Housing Secretary role, and swiped that he 'hoped those who did not show loyalty to Keir will now show it to you'. Outgoing deputy PM Mr Lammy bemoaned that he 'would have been proud to continue serving in Cabinet'.  The sackings are under way after Mr Burnham used his Downing Street debut to hint at a lurch to the Left. Watched by an adoring crowd of aides and supporters, Mr Burnham said he wanted to put services under 'stronger public control' and 'reindustrialise' with a 'ten-year plan'. He repeated his view that Britain has been heading in the wrong direction since Margaret Thatcher was PM.  He made clear his first instruction to officials would be to end rough sleeping, and revealed there would be some help on the cost of living announced tomorrow – but stopped short of giving any details.  Mr Burnham was invited to form a Government at an audience with the King in Buckingham Palace – where he was unusually accompanied by wife Marie-France van Heel. But the former Greater Manchester Mayor is already facing a crucial moment, with all eyes on whether Ed Miliband will be made Chancellor. The Left is pushing hard for the appointment, despite alarm from businesses and moderates. Markets have been calmer following speculation that Shabana Mahmood will get the role instead, but any surprises could prompt a panicky response. Mr Miliband dropped a broad hint that he will be leaving the Department for Energy and Net Zero in a speech to staff this morning - although he insisted he did not know what decisions Mr Burnham had made.  Meanwhile, the fates of big beasts such as Angela Rayner, Wes Streeting and Yvette Cooper are due to be decided. On another momentous day in UK politics: Andy Burnham has launched his Cabinet reshuffle after making his Downing Street debut  Mr Burnham and wife Marie-France van Heel waved to supporters as they entered No10 Mr Burnham shunned a lectern in his first speech after being officially installed as PM The former Greater Manchester Mayor saved a kiss for his mother, Eileen, who was there to see him speak The new PM was greeted outside No10 by crowds of aides and supporters, who had gathered to hear his first speech to the country The new residents of Downing Street were applauded into the building by staff Andy Burnham was officially installed as PM by the King today after Keir Starmer bowed out  Unusually, Mr Burnham was accompanied to meet the King by wife Marie-France van Heel (pictured arriving at Buckingham Palace) Keir Starmer is giving a farewell address outside the famous black door of No10, just two years after winning an extraordinary election landslide  Your browser does not support iframes. In his seven-minute speech, delivered without notes, Mr Burnham said: 'Later this year I will bring forward a new plan for Britain, a ten-year plan laying out a path from where we are now to where I believe we all want Britain to be, wherever we're coming from, whatever party we support. 'But I can do something to give people some breathing space now, some help with the cost of living. 'And I will set out some of those measures starting tomorrow, including how we pay for them.' Mr Burnham said he was aiming for the 'biggest changes in the last 40 years', with a 'new political model and a new economic model'. 'In the 1980s, Britain took some wrong turns. Political power was centralised, economic power privatised, large parts of the country de-industrialised, and they still haven't recovered,' he said. 'Many feel as though they're still in decline, and they don't have the ability to turn things around. 'And that's why we will change politics, to make it more collaborative, more about problem solving than point scoring. 'We will take power out of here and carry it into every postcode in the land so that they can do more. 'And in doing more, build a new economy where we put life's essentials back under stronger public control to make them affordable to you again. 'Re-industrialising Britain, using public procurement to back British industry.' The constitutional changeover came after Sir Keir used a farewell address outside No10 to insist he has not been a failure – despite only surviving two years following a huge election victory. Sir Keir said he was 'closing the book on my time', saying 'my work is done' and the country is 'stronger'. He insisted Mr Burnham – who orchestrated a coup to secure the leadership – would have his 'full support'. 'I go with good grace, I go with a smile and I go proud of everything we have achieved,' he said, thanking wife Victoria and his family.  Close Cabinet allies including David Lammy and Rachel Reeves had gathered with hundreds of aides in a sunny Downing Street to watch Sir Keir say goodbye. London Mayor Sadiq Khan was also present for the emotional moment.  In his valedictory statement , Sir Keir said: 'I am about to visit His Majesty The King to offer my resignation and close the book on my time as Prime Minister. 'My work is done. In six and a half years, I took our party from a historic defeat in 2019, changed it so it was fit to face the country and won a landslide general election victory in 2024. 'Since then, it has been the privilege of my life to serve you and this great country as Prime Minister, and I am confident that Britain is now stronger and fairer than it was two years ago. 'Our economy is stronger. Our public services are on the up, with the biggest fall in waiting times for 17 years. Children are being lifted out of poverty every single day. 'Immigration is down significantly. Our defence and security are on a far stronger footing and our international reputation is greatly enhanced.' The handover comes barely a month after Mr Burnham returned to Westminster following his victory in the Makerfield by-election. He has been installed by Labour MPs in a 'coronation', without a formal vote by activists – or having to spell out any policies. Among the vague commitments laid out by the incoming PM so far are devolving power away from Westminster. He has announced he will scrap Sir Keir's flagship digital ID programme to focus money and attention on the cost of living. In an interview with The Times, Mr Burnham said he had already spoken to the Treasury about his planned announcements and stressed the importance of making people 'feel better'. Adding that complaints about frozen tax thresholds had been 'lodged in his mind' since the Makerfield contest, he said: 'So when people, they're just characterising me as a tax raiser, well again, it's never that simplistic is it? The breathing space point is a really serious one.' The comments raise more questions about how Mr Burnham will pay for giveaways, after he backed a 'land tax' and harked back to the 1970s condemning Thatcherite reforms. But the weekend was dominated by bungled briefing over whether the new Government will allow new oil and gas drilling in the North Sea. The leader's team has now confirmed he will stick to Labour's 2024 manifesto, which promised not to issue new licences. Instead he could merely allow expanded drilling at the Rosebank and Jackdaw sites – something that was being considered by Sir Keir's administration. That could bode badly for Mr Burnham's relations with Donald Trump, who yesterday jubilantly hailed more drilling as a way of stopping Britain being a 'poverty stricken disaster'. Mr Burnham also faces a decision on whether to temporarily nationalise Thames Water as the firm struggles with a £20billion debt pile. He has already expressed support for greater public control of essential services, and Thames Water's main creditors have said they are willing to discuss the issue with his new ministers in an effort to agree a rescue deal and avoid the business falling into a so-called 'special administration regime'. Another priority is likely to be reforming social care, which he has said is something he wishes to 'expend political capital' on. Your browser does not support iframes. Eco-tycoon Dale Vince was spotted in Downing Street wearing a 'chips are vegan' T-shirt, amid confusion over whether the Government will allow more drilling in the North Sea The Labour Left is still clamouring for Ed Miliband to be made Chancellor, despite alarm from businesses and moderates The fates of big beasts such as Angela Rayner, pictured on the campaign trail with Mr Burnham, are due to be decided Keir Starmer's resignation was accepted by the King at an audience in Buckingham Palace today Close Cabinet allies including David Lammy and Rachel Reeves had gathered with hundreds of aides in a sunny Downing Street to watch Sir Keir say goodbye There was a hug for Chancellor Rachel Reeves - also expected to lose her job - after the speech Sir Keir gave his wife a kiss as they left Downing Street for the final time today  Sir Keir and Lady Victoria got into a car to be driven to Buckingham Palace after his speech Your browser does not support iframes. Kemi Badenoch warned Mr Burnham he will have to cut spending instead of increasing taxes Liberal Democrat leader Sir Ed Davey has urged Mr Burnham to engage other parties to solve the 'social care crisis', calling for guaranteed rights for family carers, a universal safety net and protection against 'catastrophic costs'. Kemi Badenoch has also written to Mr Burnham, saying her party will work with him to cut the welfare bill and calling for him to rule out tax rises and back new oil and gas drilling. Mrs Badenoch told Mr Burnham she would 'never shirk' from holding him to account, adding: 'You will enter office without having set out a clear plan on any of the issues facing our country. 'You have refused calls to come to Parliament for questions from MPs, and you have not submitted yourself to serious media scrutiny. This is not a promising start.'