Please click here to access the briefing: GK Strategy – Andy Burnham Labour Party Conference – October 2026
This will be followed up a separate briefing on the government’s commitment to reform the adult social care system and introduce a National Care Service.
This year’s conference season saw one of the clearest ideological divides in British politics for some time. The prime minister delivered a speech that many on the left had long wanted to hear, making the case for a more active and interventionist state. In Birmingham, Kemi Badenoch offered an equally unapologetic defence of Thatcherism.
The Conservative leader’s speech gave a sense that the party is finally off life support and up for the fight, with a renewed appeal to the shires through promises of tax cuts that will undoubtedly energise the Tory core vote. At the same time, Badenoch sought to challenge Reform UK on questions of values and integrity. Clearly adored by her party members, she remains behind in the polls and continues to fight for attention from the country.
More significant than any individual announcement was the moral case set out in The Right Way, Badenoch’s conference policy document, and echoed throughout her speech. Almost every policy proposal was rooted in a belief in personal responsibility and the value of individual endeavour. Badenoch argued that individual effort is not only the source of economic prosperity but also of human fulfilment and opportunity. In that sense, her speech was about more than policy. It was a battle of ideas, with Badenoch presenting conservatism as a competing vision ‘for the soul of the country’.
The headline-grabbing policy announcement was Badenoch’s pledge to abolish inheritance tax on family homes and raise the amount an individual can pass on tax-free to £500,000. Under the proposals, a couple would be able to leave their main residence to direct descendants free from inheritance tax, alongside a further £1 million of assets to other beneficiaries. Long criticised by many on the right as Britain’s least fair tax, inheritance tax is often portrayed as a form of double taxation, applying to assets accumulated from income that has already been taxed.
Badenoch also identified the eventual abolition of inheritance tax as a long-term ambition. Critics argue, however, that the benefits would be concentrated among the wealthiest and not ‘ordinary’ families. The Institute for Fiscal studies estimated that the wealthiest 1% of estates, worth £2.1 million or more, would receive around half of the gains from full abolition. Some also worry that the proposal could encourage older homeowners to remain in larger properties, limiting the availability of family-sized homes.
The Leader of the Opposition also argued that too many people are being written off by a welfare system that discourages work. Her reforms would remove access to out-of-work benefits immediately after school or university, introduce ‘back to work’ cards for long-term claimants, and require those able to work to engage with employment programmes. Badenoch aims to couple these welfare reforms with plans to halve the jobs tax for under-25s and repeal Labour’s Employment Rights Act.
Badenoch said that cutting the welfare bill would help fund higher defence spending, something that was notably absent from Burnham’s conference speech. Central to this was a £10 billion commitment to build ‘Britannia Shield’, an integrated UK air and missile defence network. The proposal would initially focus on protecting critical national infrastructure and military bases before being expanded to cover the UK mainland and British territories overseas. However, with the programme expected to be delivered over ten years, it represents a long-term ambition rather than a rapid build-out.
The proposal is more ambitious than the government’s current plans, having previously identified missile defence as a priority while allocating less than £800 million to the capability over four years. This comes despite a recent commons Defence Committee report warning that the UK has ‘next to nothing’ in place when it comes to missile defence, particularly against the growing threat posed by drones.
Despite the non-nonsense tone of Badenoch’s speech and the long list of policy commitments unveiled at conference, all of it ultimately depends on the Conservatives returning to power. With Badenoch ruling out an electoral pact with Reform UK and the party still polling below its performance at the 2024 general election, the central question remains whether voters are willing to give the Conservatives another hearing after fourteen years in government.
Steve Brine, GK’s Strategic Adviser and former health minister said: ‘What struck me was the attempt to give the Conservatives a clearer organising argument: that Britain’s problems stem from weak growth and an overextended state, and that the answer is greater economic freedom, lower taxes and firmer choices about public spending. The speech also sought to present Kemi as someone prepared to make the case for a distinct Conservative identity and one that her party feels wholly comfortable with. In that, the two main parties are in lock-step. The test will be whether that argument can be turned into a credible and coherent programme for government.’
Robert Halfon, GK’s Strategic Adviser and former education minister said: ‘Kemi Badenoch leaves conference with her leadership secure and her party more united than it has been for years. The direction is clear: firmly Conservative, and clearly distinct from Reform. Skills are part of that offer. Badenoch put apprenticeships in her leader’s speech, and the plan to move money from poor-value degrees into apprenticeships gives the Education team a concrete policy to drive forward. Employers will now want to see it costed and funded.’
GK’s Lauren Atkins shares her reflections from attending Labour Party Conference.
As September drew to a close, party members, politicians, journalists and public affairs professionals once again descended on Liverpool for the annual Labour Party Conference. The third since Labour took office in 2024, this year’s gathering was the first with Andy Burnham as Prime Minister, setting the stage for a party looking to turn the page on recent political instability.
There was a palpable buzz around this year’s conference. The atmosphere was one of renewed optimism and a desire for clearer direction, reflected in the presence of Burnham’s new cabinet colleagues and junior ministers, who packed out fringe events and receptions to engage with party members and businesses. There was a clear effort to reconnect Labour with its sense of purpose and build excitement around the government’s next chapter.
Under the banner of “Hope Again”, Burnham’s first conference speech as Prime Minister provided the focal point. Promising to “break with the direction of the past forty years”, he criticised deindustrialisation, deregulation, privatisation, austerity and Brexit, setting out a vision in which the state takes a more active role in public services, economic renewal and tackling the cost of living. The speech received at least eleven standing ovations from delegates in the main conference hall, underlining the enthusiasm among party members for a clear, long term political vision for the UK.
The policy announcements were wide-ranging. Burnham committed to establishing a National Care Service in the next parliament, transforming the state pension triple lock from 2030, and launching a commission on electoral reform. He also signalled a renewed focus on the UK’s long-term relationship with the EU, promised legislation to enable the public ownership of water companies, and announced plans to remove VAT from electricity bills from the beginning of October, develop a national energy plan and establish Great British Grid. On housing, he reaffirmed plans for the biggest council housebuilding programme since the post-war era, alongside measures to support first-time buyers and reform leasehold. Internationally, he pledged to put AI at the centre of the UK’s G20 presidency next year.
Taken together, these commitments offered a clearer articulation of the government’s ambitions and helped sustain the conference’s sense of momentum. Yet, while the enthusiasm in Liverpool was unmissable, the government faces a tight timetable to convince the wider electorate that its vision can deliver. With the next general election less than three years away, the challenge will be to turn the optimism of “Hope Again” into tangible improvements for households and businesses, particularly those facing persistent cost-of-living pressures.
Yesterday’s long-term commitments – with the most significant policy changes not expected until 2030 – were certainly valuable for Burnham in setting out his stall and establishing a sense of direction, but they will do little to reassure voters unless progress is also felt in the near term. The upcoming Budget will be an early test of how the government intends to balance its ambitious programme with the realities of public spending and the immediate economic pressures facing the country.
Burnham has given Labour members renewed reason to feel energised about the future. The conference had a genuine sense of optimism and purpose, but the real test lies beyond Liverpool docks. The coming months will determine whether that enthusiasm can translate into effective government, and whether “Hope Again” can become more than a conference slogan.
Erin Caddell of GK Strategy’s American partner Anchor Advisors examines the ideological battle reshaping the Democratic Party and what it could mean for investors, corporates and the future direction of US policy
Sir Isaac Newton’s Third Law of Motion, published in 1687, states that for every action there is an equal and opposite reaction. This centuries-old theorem may go some way toward explaining the ideological split currently occurring in the U.S. Democratic party – one that could carry significant importance for the congressional midterm elections in November 2026 and for U.S. policy for many years to come.
Republican President Donald Trump faces a difficult political backdrop approaching the midterms, often thought of as a referendum on the incumbent U.S. president’s first two years in office. Trump faces sagging approval ratings in his second term, with notable weakness on his handling of the economy due to rising inflation, as well as a Middle East war with no easy way out. As this column has noted before, Republicans are already defending one of the narrowest House majorities in American history (218-212, with four vacancies and one independent).
Given these dynamics, many Democratic leaders and pundits have suggested the party employ a midterm campaign version of Napoleon’s military adage to never interrupt your enemy when he is making a mistake: focus voters’ attention on Trump policies that many voters view unfavorably rather than on promoting a robust alternative agenda. To these strategists, the poster child for the ideal Democratic candidate in 2026 is Roy Cooper, a two-time former governor of North Carolina running for U.S. Senate in that state with the simple slogan “Make Stuff Cost Less”. Cooper focuses fairly narrowly on criticizing Trump actions that he argues have resulted in “farmers… getting crushed by tariffs” and “families… seeing prices rise at grocery stores and restaurants.” In response, Cooper proposes a modest set of reforms such as tougher anti-trust enforcement and making data centers pay more for the power they draw from public utilities.
Cooper may well reach the Senate – he has run ahead of his Republican opponent in every poll published since the race began. But the middle-of-the-road approach of Cooper and other moderates is not capturing the hearts of Democratic voters writ large. The hard-edged governing style of Trump and his Republican congressional allies, in areas ranging from immigration enforcement to foreign policy to social spending, has, to use a scientific term, made Democrats mad as hell. And – returning to Newton’s Third Law – Democrats want their leaders to push back hard at Trump with policies equal and opposite to those promulgated by the GOP-led Administration and Congress.
Evidence of Democrat voters’ more confrontational impulse is ample in recent party primaries to select candidates to run in the November congressional elections. In June, two progressive U.S. House candidates running to represent district in New York City – Brad Lander and Darializa Avila Chevalier – ousted incumbents, while a third (Claire Valdez, a member of the state Assembly) defeated the Brooklyn borough president in a race for another U.S. House seat. All three candidates support increased government support for public housing, universal federal health insurance, abolishing the U.S. Immigration and Customs Enforcement (ICE) agency, cutting defense spending, shifting energy production from fossil fuels to renewables to address climate change, and reducing American military involvement abroad, among other progressive policies. All are vocal in their criticism of Trump. It is not just in deep-blue New York where the left is gaining momentum: earlier this month, Melat Kiros, a 29-year-old Democratic U.S. House candidate in Colorado, backing an agenda similar to her New York counterparts, unseated U.S. Rep. Diana DeGette, who had represented the district in D.C. for nearly 30 years. Progressive candidates have tallied recent election wins in states from Maryland to Oregon.
A number of the candidates cited above, and others squaring off against more-moderate Democrats, are members of the Democratic Socialists of America (DSA), a left-leaning political organization founded in 1982. DSA’s importance in the U.S. political ecosystem can be easily exaggerated by both critics and supporters – the organization reports about 120,000 members, compared to 45 million Democrats and 39 million Republicans. Yet the DSA has clearly touched a nerve within a Democratic party still trying to figure out how best to oppose Trump and his MAGA movement – and position itself for a post-Trump future. The party’s goal to create “a system where ordinary people have a real voice in our workplaces, neighborhoods, and society” (see below) echoes in the campaign speeches and placards of progressive candidates on the stump today. The most famous DSA member is New York City Mayor Zohran Mamdani, the 34-year-old political wunderkind who rode his own anti-Establishment, anti-incumbent wave to power in January, defeating Andrew Cuomo, former New York governor and scion of a well-known political family.
What is Democratic Socialism? “Capitalism is a system designed by the owning class to exploit the rest of us for their own profit. We must replace it with democratic socialism, a system where ordinary people have a real voice in our workplaces, neighborhoods, and society… We want a democracy that creates space for us all to flourish not just survive and answers the fundamental questions of our lives with the input of all. We want to collectively own the key economic drivers that dominate our lives, such as energy production and transportation. We want the multiracial working class united in solidarity instead of divided by fear. We want to win “radical” reforms like single-payer Medicare for All, defunding the police/refunding communities, the Green New Deal, and more as a transition to a freer, more just life.” (Source: Democratic Socialist of America)
The recent success of DSA members and similarly inclined progressives has led to an equal and opposite (Newton again!) reaction from moderates who argue that moving too far to the left will cost Democrats in the midterm elections in November as well as the presidential election in 2028. In a July 20th note, Third Way, a center-left think tank, warned: “If [Democrats] follow the siren song of the left, they will steer their ships into the rocks. If they remain in the mainstream, they will have a fighting chance of winning not only the primary, but also most crucially, the general election.” Third Way and other naysayers of the progressive wave cite the example of Kamala Harris, who ran on a progressive agenda as the Democratic party’s presidential nominee in 2024 after then-President Joe Biden opted not to run for re-election. In the 2024 campaign, Harris proposed ambitious spending to combat climate change, an increase in the corporate tax rate and anti-price gouging laws for groceries, among other policies popular with many progressives. Trump, of course, comfortably defeated Harris in the presidential election (though the hurried mid-campaign handoff from Biden to Harris certainly didn’t help).
What does this mean for US-focused investors and corporates?
The moderate, middle-of-the-road approach of some Democratic candidates doesn’t seem to meet the political moment. Thus, we do think the progressive movement will move the Democratic Party to the ideological left in the years to come, even if “socialist” candidates remain a small portion of the electorate and the Congress. This could benefit sectors that have been out of favor thus far in Trump’s second term. For instance, health insurance companies that provide insurance under Medicaid and other healthcare programs for disadvantaged Americans could benefit from reversal of recent cuts to such programs under a Democrat-controlled Congress and/or White House. Similarly, apartment-focused real estate investment trusts (REITs) would benefit from expanded public spending on housing in a more progressive political climate. Child-care providers could see the same from federal programs to provide more support for working families. In sum, Democrats’ intense anger at Trump’s policies and persona are likely to be quelled only by a similarly forceful agenda on the other side of the spectrum – the equal and opposite reaction crystallized by Newton so long ago.
GK’s Brett Morton examines the ongoing negotiations with the EU on a youth mobility scheme and what it means for the future of the UK-EU relationship
A youth mobility agreement has become a central component of the Labour government’s drive to improve UK-EU relations. Although both sides broadly support the principle of making it easier for young people to live, work and study across borders, the parties remain divided over the terms. Points of contention over immigration caps and tuition fees risk preventing a wider package of UK-EU cooperation measures. Both sides had been keen to secure these at a second bilateral summit scheduled for 22 July in Brussels. The summit has now been delayed following the Prime Minister’s resignation.
The scheme under discussion would allow 18-30-year-olds from the UK and EU to spend a limited period living, studying and working in each other’s countries. In broad terms, it would resemble the agreement the UK already has with countries such as Australia and Canada. Under those arrangements, young people can come to Britain for up to three years, subject to visa rules and annual caps, and work, travel or study without employer sponsorship. The UK would like any deal with the EU to follow the same basic model: temporary, managed and clearly distinct from free movement.
That distinction matters because immigration remains one of the most politically charged legacies of Brexit. Opponents of the proposal, including Nigel Farage, argue that such a scheme would amount to freedom of movement under a different name. Ministers have been keen to stress that any agreement with the EU would be time-limited and capped. Reports suggest the Starmer government favoured a ceiling of 50,000 participants a year. The EU, by contrast, is believed to prefer a more flexible arrangement, with no fixed cap but a break mechanism that would allow either side to intervene if numbers became excessive. For the next Prime Minister, accepting a scheme without a visible numerical limit would be politically difficult, particularly given the public’s appetite to reduce net migration.
Since Brexit, labour shortages have become a persistent problem in sectors such as hospitality, agriculture and construction. At present, a young EU citizen who wants to work in the UK for a limited period usually needs sponsorship from a British employer. In practice, that system is often costly, bureaucratic and tied to salary thresholds that many small businesses cannot meet. In many cases, sponsorship requires employers to offer a salary of at least £41,700 a year, or the going rate for the role, which places it out of reach for much seasonal, temporary and lower-paid work. Supporters of a youth mobility scheme argue that without the need for sponsorship or salary thresholds, it could widen the pool of labour and make it easier to fill temporary or seasonal vacancies. Even so, its impact would be limited, as it may ease pressure in high-turnover sectors but would do far less to address longer-term shortages in fields that depend on permanent skilled workers, such as healthcare or technology.
A major obstacle to a youth mobility agreement is tuition fees. The EU wants students to study in the UK and EU countries on the same basis as domestic students, meaning EU students at UK universities would pay home fees rather than higher international rates. With 24 institutions reportedly at risk of insolvency within the next year, according to the Education Select Committee, international student fees have become a vital source of income. The Russel Group, an association of 24 prestigious universities in the UK, has warned that granting EU students home fee status could cost the sector around £580 million, reducing universities’ ability to invest in programmes such as Erasmus+ and Horizon Europe.
The youth mobility debate must also be understood in its wider political context. Starmer had originally hoped that a UK-EU reset would help revive his premiership by showing that closer cooperation with Europe could deliver practical benefits, from smoother trade to lower costs for consumers. With his resignation, that personal political purpose has fallen away. Future negotiations are no longer about rescuing his administration, but about shaping the direction of the next Prime Minister’s agenda.
With an Andy Burnham coronation now increasingly likely ahead of 22 July, the EU has postponed the summit. A youth mobility scheme could offer Burnham an opportunity to pursue economic and social reforms in response to what he has described as the ‘damage’ caused by Brexit. However, Burnham is also likely to be cautious about making significant concessions to Brussels, particularly on a cap, as he seeks to appeal to Reform UK voters and avoid reopening divisions from the Brexit referendum ahead of a potential 2029 general election. The future of any youth mobility scheme with the EU will therefore depend on Burnham’s political calculus.
GK’s Joshua Owolabi assesses Chancellor Rachel Reeves’ and FCA Chief Executive Nikhil Rathi’s differing perspectives on consumer finance regulation and the potential impact on the sector
The Chancellor Rachel Reeves insists that the government’s main objective is to facilitate economic growth and believes that the UK’s regulatory bodies should support this objective. In January 2025, the Chancellor wrote to several regulators, including the Financial Conduct Authority (FCA), directing them to ‘tear down regulatory barriers’ that hold back economic growth. This view is likely to have a significant impact on the regulation of consumer finance during the rest of this parliament (expected to end in 2029).
Since the 2008 financial crisis, the FCA and its predecessor the Financial Services Authority, have generally preferred to strengthen consumer finance rules to prevent the harm to consumers that occurred following the crisis (e.g. consumers being forced into high-interest loans without fully understanding the long-term impact on their finances). The pressure placed on the FCA could result in a reversal of long-term regulatory trends in the consumer finance sector, reducing compliance requirements on businesses across the sector.
Across several consumer finance sub-sectors, such as mortgages, motor finance, and personal loans, the FCA has spent the last decade implementing stricter measures to prevent the mis-selling of products and services, and to protect consumers from taking on excessive debt. These efforts culminated in the implementation of the Consumer Duty in July 2023. The Duty is a regulatory framework requiring firms to prioritise consumers’ needs. Firms must proactively identify the specific needs of each of their customers and prevent risks that could result in financial harm. This involves providing customers with clear financial advice on products like hire purchase agreements, which are common in the motor finance industry, so that they can make informed choices. It also involves making it as easy as possible for customers to switch or cancel products without incurring unnecessary debt.
Rachel Reeves’ belief that financial services regulation should encourage innovation, competitiveness, and increased risk taking in lending and investment is at odds with recent FCA consumer protection measures. This has resulted in contrasting messages from Reeves and FCA Chief Executive Nikhil Rathi. While Rathi has said the FCA will support innovation and economic growth, he has voiced concerns that the push to prioritise growth will result in an increase in financial scandals. He has warned the government and parliamentarians that there may need to be an ‘enduring acceptance’ of these failures as regulations are relaxed. Rathi’s concern is not a surprise. Since his appointment as Chief Executive in 2020, he has consistently emphasised the importance of consumer protections and market stability. Under his leadership, the FCA has prioritised improving affordability checks so that firms are not just doing basic credit checks and consumers understand the true cost of products.
An area where major change is likely to occur, despite Rathi’s reluctance, is in the balance between regulation and access to credit. Reeves has argued that excessive regulation can make it harder for consumers to borrow money, slowing economic growth. As a result, the government announced in May 2026 that it would reform the Consumer Credit Act 1974 (CCA), which established standard procedures for credit and hire agreements and sets out consumers’ rights when dealing with businesses in those sectors. The government says that its reform of the CCA is focused on modernising consumer credit rules so that they better reflect the realities of today’s digital financial market. It has stated that its main objective is to improve the quality and clarity of information provided to consumers. The government argues that current disclosure requirements are outdated, overly complex, and often overwhelm borrowers with lengthy legal documents that are difficult to understand. The government has said that the CCA reforms will help consumers make better-informed financial decisions and reduce the risk of individuals taking on unsuitable or unaffordable credit.
The government is likely to say that the primary reason for reforming the CCA is its desire to protect consumers. However. the push for economic growth and deregulation in financial services is what is truly driving these reforms. In reality, the core goal of the reforms is to reduce the number of detailed regulatory requirements that are entrenched in legislation and to give the FCA more power to amend regulations quickly without the passing of new legislation. By giving the FCA greater responsibility for setting consumer credit rules, the government hopes to create a more agile regulatory system that can respond more quickly to innovations in financial products, such as fintech and embedded finance. This is likely to lower compliance costs for businesses in the consumer finance market and reduce the likelihood that they fall foul of rules relating to the way in which credit agreements are written or structured.
Ironically, the changes to the CCA, including the increased role of the FCA in modernising credit rules, will place greater power in the hands of Rathi to regulate consumer finance, despite the difference in views with the Chancellor. Rathi will now need to oversee the implementation of changes to the CCA, while also overseeing other consumer finance reforms that have already been announced. For example, the FCA has said that it will complete a review of the Consumer Duty before the end of 2026 to understand firms’ approaches to monitoring consumer outcomes and how well consumers understand risk. The FCA believes that some firms are struggling to provide clear evidence that they are improving outcomes for consumers or that their advice is specific to each individual customer’s needs. This means that there is a scenario where firms will have requirements relating to affordability checks reduced by the CCA reforms, only to see new requirements placed on them to collect data on consumer outcomes following the review of the Duty. The implementation of both these reforms is an unenviable task for Rathi, as he seeks to balance pressure from the Treasury to support economic growth with his own regulatory agenda. The FCA will need to engage with firms to ensure that they are fully aware of the expected changes to the regulatory framework and that firms are not confused by the mixed messaging from the Treasury and the regulator itself.