Andy Burnham returns to parliament next week as prime minister with improved Labour polling, but faces an immediate test as his government moves from its early honeymoon period into difficult policy decisions. His first Prime Minister’s Questions against Conservative leader Kemi Badenoch, alongside pressures over the Budget, welfare, living costs and prisons, will help define the new administration’s direction.

Chancellor John Healey’s 28 October Budget must meet existing fiscal rules and Labour’s pledges not to raise income tax, national insurance or VAT, despite calls from some MPs for higher taxes on wealth, capital gains or companies. Reviews of Personal Independence Payment and youth unemployment could prompt contentious welfare changes, while energy bills are due to rise 4% in October and potentially 9% in January; meanwhile, about 5,000 prisoners are planned for early release from October, though exclusions reduce that figure by 1,000.