Betting on Britain: or how to calm the bond markets & raise living standards

New Chancellor John Healey gave his first major policy speech on Monday, the clearest preview yet of what the Burnham‑Healey economic plan might look like, ahead of the Autumn Budget on October 28. So what did Healey say, and how do we stop Burnonomics/Healeyonomics rehashing the same old failed economic orthodoxy that has failed this country for the last 40 years?

The game’s Bonds, Gilt Bonds markets

The Chancellor’s speech started with (bare with me); “Setting out plans for growth, This government’s direction for growth, that will see growth in more places in future. […] growth driven from more places in the UK”. 

In case you missed it then, the government will continue the previous administration’s focus on… “growth”. He also unequivocally stated a commitment to the previous Chancellor – Rachel Reeves’ – self-imposed strait jacket, aka the “fiscal rules” which require the government budget to be balanced by 2029/30, debt to fall, and certain welfare spending to stay capped. 

These restrictions were introduced as a way of “calming the bond markets”. What does that mean? Well, bond markets are essentially a way for the government to take out loans from private investors, pension funds and banks. Keeping them “calm”, means reassuring investors that the UK government and economy is a safe bet. That’s because the more confident those investors are, the lower the interest rates they demand, and the easier it becomes to service debt and reinvest.

And that’s how we arrived here, with abstract “growth” rather than, say, higher living standards, being the primary driver of government policy. The idea being if the economy is bigger, and more money is moving around it, then tax receipts will be higher and there’ll be more cash to pay off debts. Similarly, if government spending is lower, then there’s more cash available to pay creditors. After 14 years of austerity under the previous Conservative-led governments we know that cutting spending and government investment hurts us in the short and long-term, and undermines growth. The current approach risks cutting ourselves further into stagnation.  

We need to remember that inspiring confidence in the bond markets, means building a country that works. Healthy, skilled workforces, decent transport, affordable energy, strong public services— these are the building blocks of a thriving economy. Slashing social security, for short‑term savings, and pushing people deeper into poverty, cutting infrastructure doesn’t grow an economy. Investment does.

Can PuFins help the UK economy to fly? 

That’s why the most meaningful part of Healey’s speech was the plan to expand PuFins— that’s Public financial institutions— investment programs. PuFins let the government act as a lender itself, a co‑investor, backing infrastructure, housing, and high‑growth businesses while generating returns for taxpayers. Burnham and Healey want this done regionally, working with mayors to identify local projects that need capital. And because these investments generate a direct financial return, they offset some of the total debt figure (that they need to keep dropping).

It’s a bit of a workaround— but it’s also an admission. “Fiscal responsibility” is what the government thinks the bond markets want to steady the ship, but it won’t dig our economy out of the hole it’s in. Investment is unavoidable. Britain cannot cut its way to prosperity. A national economy is not a household that must “tighten belts”; it’s more like a BCorp— a business with social aims. If a business is struggling, you invest in it. If it’s not fulfilling its mission, it changes tack.

Rather than acknowledge the possibility of unlocking investment and tackling inequality simultaneously by taxing hoarded wealth, the billionaire‑owned press has tried to force this moment into a false binary: cut spending or raise taxes. You’ll have noticed the recent flood of stories about immigration and social security, always framed as unaffordable burdens. This narrative ignores basic facts. Immigration is a net positive for public finances. Most people receiving social security payments are working. Millions of disabled people or those with long-term health conditions cannot work, with many of them wanting to. Social security reduces poverty, and helps people return to work, gives children a better start in life, and strengthens long‑term productivity.

This framing is designed to scare ordinary people who are already struggling, and pit us against one another. When headlines warn vaguely of “higher taxes”, they imply tax rises on everyone — even though the UK has enormous untapped extreme wealth. Millionaires, billionaires, and highly profitable corporations can easily afford to be taxed what is realistically, a very small amount more, to generate the revenue for the investment Andy Burnham’s government needs to deliver on the reset that was promised. Most are even happy to do so because they want to live in a thriving country, giving them ever better economic conditions for future success. 

Unfortunately there is a loud and powerful minority of greedy super-rich people, lobbyists and companies who are happy for the country to go to the dogs if it means protecting their hoarded fortunes. That’s why they’re stoking hate and division to distract us all, and framing tax like a bad thing. 

Betting on Britain

Healey’s speech shows the government knows investment is essential, but it still seems trapped inside rules and narratives designed to prevent it. The media’s counterweight to the massive public support for wealth taxes, is to turn everyday occurrences into scare stories, pushing narratives that have been debunked time and again.

Healey must shut it all out and be clear‑eyed at the Autumn Budget. We need our Chancellor to make the positive case for tax rather than be trapped in the negative framing from the press— after all taxes are the reason we have the NHS, free education, a fire service, state pensions, decent roads and public transport, and much much more. Britain can recover, rebuild and do great things again, but not without investment. And that investment needs to come from those who can afford it.