Andy Burnham unveiled first cabinet last night (20 July), including posts for his fellow Labour/Co-op MPs Jonathan Reynolds, Lucy Powell (above), Alex Norris and Miatta Fahnbulleh.
Reynolds returns to the role of business secretary, which he held under Keir Starmer from July 2024 to September 2025. Under his previous tenure he managed to win praise from both unions and business executives for his collaborative approach and steady hand.
He also played a key role in taking over British Steel after Chinese company Jingye Group tried to shut down its Scunthorpe site – although he was criticised by opposition parties and some sections of the press for not anticipating the crisis, and from industry bodies over his changes to import tariffs.
Moving back to the job from the chief whip’s office, he replaces Peter Kyle.
Meanwhile, Powell, previously seen as an ally of Burnham, moves from deputy Labour leader to education secretary. She had served in Starmer’s government as leader of the House of Commons and lord president of the Council before being dismissed from the role in September 2025. She soon after elected deputy leader in a race where she was seen as the anti-Starmer candidate, defeating rival Bridget Phillipson.
Powell now replaces Phillipson in the education role, with Phillipson remaining in the cabinet as minister for women and equalities.
Related: Andy Burnham becomes UK’s first Labour and Co-operative prime minister
Alex Norris replaces David Lammy as justice secretary and Miatta Fahnbulleh replace Ed Miliband as secretary for energy and net zero.
Other changes saw Labour Co-op MP Steve Reed axed from the cabinet. Seen as a Starmer loyalist, Reed – a leading light of the co-op councils movement – had served as housing, communities and local government since September 2025.
Key roles go to non Co-op MPs, with John Healey, in a surprise move, appointed chancellor; blue Labour figure Shabana Mahmood retaining the home secretary job; Ed Miliband moving to foreign secretary from energy; and Yvette Cooper becoming health secretary. Pat McFadden remains remains work and pensions secretary and Louise Haigh was named first secretary of state. Lisa Nandy keeps her role as culture secretary and Wes Streeting replaces Healey at defence.
Angela Rayner returns to the cabinet as housing secretary. Although not sitting as a Labour / Co-op MP, her appointment is likely to be welcomed by the co-op movement as she has been a vocal supporter of co-operative and community-led housing as well as, more widely, social housing.
Earlier this year, she wrote the forward to a Co-op Party report, Yes In Our Backyard, which called for an expansion of community-led housing, and told the Mirror: “As with so many of the challenges our country faces, communities already have so many of the answers. Rather than holding them back and frustrating them, the system should be on their side and putting power in their hands.”
Related: Angela Rayner backs co-op housing push in new report
The Confederation of Co-operative Housing (CCH) welcomed Rayner’s appointment, along with Burnham’s premiership, adding that it looks forward to working with the new government to deliver its commitment to grow the co-operative economy.
The government’s pledge to double the size of the co-operative sector presents a significant opportunity to expand co-operative housing across the UK, added CCH.
The organisation hopes to work closely with ministers to progress the recommendations set out in its election manifesto, including measures to increase access to finance, land and long-term support for community-led housing.
The organisation also welcomed the announcement that housing minister Matthew Pennycook will attend cabinet, describing this as an important step in ensuring housing – and co-operative housing in particular – has a stronger voice at the heart of government.
CCH said it looks forward to engaging with ministers over the coming months to help create the policy framework needed to unlock the potential of co-operative and community-led housing.
Other changes see Angela Eagle replace Emma Reynolds at Defra.
Meanwhile, Burnham has announced his first policy move, scrapping the 5% VAT levied on household electricity to 0%. It is estimated the move will save a typical home about £45 a year, and the new government says it will be funded by axeing Starmer’s plans for digital ID.
