Andy Burnham urged to tap £150bn council pension surplus; allies urge CGT hike

Andy Burnham, the former Greater Manchester mayor and prospective Prime Minister, is being pressed to release part of the roughly £150 billion surplus in local government pension funds. Proponents argue the cash could fund local services such as social care, libraries and infrastructure without raising taxes or increasing borrowing, and would fit a broader devolution agenda that would give regional mayors greater fiscal control.

Labour ally Louise Haigh, tipped for a senior role in Burnham’s prospective cabinet, has called for a major overhaul of the tax system. She proposes raising Capital Gains Tax to 45 % and closing loopholes, while also urging the government to relax fiscal rules to let the National Wealth Fund borrow beyond current limits and to drop the Treasury’s “growth mandate”. Both proposals aim to shift the tax burden from labour to capital and to support long‑term investment.

The proposals have sparked debate over the legality of tapping pension surpluses, the impact on taxpayers and the potential for reshaping Britain’s fiscal framework as the Labour Party prepares to assume power.