Sue Gray has resigned from her position as Sir Keir Starmer’s chief of staff, Number 10 has announced.

Ms Gray has instead been appointed as the prime minister’s envoy for nations and regions.

Morgan McSweeney, the party’s former campaign director who masterminded July’s election landslide, will replace her as the prime minister’s chief of staff.

Ms Gray said that while it had been “an honour to take on the role of chief of staff”, it had become clear that “intense commentary around my position risked becoming a distraction to the government’s vital work of change”.

“It is for that reason I have chosen to stand aside, and I look forward to continuing to support the prime minister in my new role.”

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The prime minister thanked Ms Gray – who famously authored the report into parties in Downing Street during the pandemic – for “all the support she has given me, both in opposition and government and her work to prepare us for government and get us started on our programme of change”.

“Sue has played a vital role in strengthening our relations with the regions and nations. I am delighted that she will continue to support that work,” he added.

Ms Gray’s resignation follows weeks of speculation about her role and reports of a power struggle at the heart of government.

Tensions over Ms Gray’s role reached a crescendo when her salary of £170,000 – £3,000 more than the prime minister – was leaked to the BBC in an apparent attempt to damage her politically.

The broadcaster also reported more junior staff were disgruntled they were not being paid more than what they received when Labour was in opposition – despite now occupying more senior government roles.

Government ‘thrown into chaos’

A Conservative Party spokesperson described the latest moves in Downing Street as “chaos” and questioned who was running the country.

“In fewer than 100 days Sir Keir Starmer’s Labour government has been thrown into chaos – he has lost his chief of staff who has been at the centre of the scandal the Labour Party has been engulfed by,” they said.

Blame for this mess lies with Sir Keir

Sam Coates

Deputy political editor

@SamCoatesSky

Sir Keir Starmer has now gone full circle. At lunchtime he replaced Sue Gray, the former civil servant whose appointment has caused him endless pain, with Morgan McSweeney.

While the elevation of his campaign chief was widely welcomed, this is nevertheless a curious move.

Mr McSweeney was his very first chief of staff back in opposition in 2020 and for the first 14 months of his leadership, until he was moved after the botched reshuffle of 2021.

Cabinet members and Labour MPs must hope second time around he will be a better fit.

In doing so, the prime minister is in effect admitting very big personnel mistakes, forced to act eventually because of complaints from every side around him that the situation had become untenable.

At its heart, Ms Gray – who was known in Whitehall as the consummate fixer – had to go because nothing felt like it was being fixed.

She was in charge of preparations for government, but when 5 July arrived they appear scant and progress from there was slow.

But blame for this should lie not with her but with Sir Keir.

If there had been enough due diligence on the appointment, some of these problems might have been anticipated.

“Sue Gray was brought in to deliver a programme for government and all we’ve seen in that time is a government of self-service.

“The only question that remains is: who will run the country now?”

One Labour insider told Sky News that the current leadership “spent years saying how it was time to professionalise the party – but this chaos with Keir Starmer seems remarkably similar to the chaos with Jeremy Corbyn”.

They pointed out that Mr McSweeney previously served as Sir Keir’s chief of staff between 2020 and 2021 before being moved on to his campaign role.

In a major announcement on Sunday, Sir Keir also announced a shake-up of his entire Downing Street operation following disquiet at how the party handled rows over freebies and donations, as well as its decision to axe winter fuel payments for most pensioners.

Vidhya Alakeson and Jill Cuthbertson have been promoted to deputy chiefs of staff, while Nin Pandit has been appointed as Sir Keir’s principal private secretary.

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Meanwhile, former journalist James Lyons will join from TikTok to lead a new strategic communications team.

The prime minister said he was “really pleased to be able to bring in such talented and experienced individuals into my team”

“This shows my absolute determination to deliver the change the country voted for,” he added.

One source told Sky News that the news of Ms Gray’s departure came on Sunday after plans for the reorganisation announcement on Monday were leaked to the media.

Her advisory role will be to support Sir Keir and the cabinet in delivering on its devolution agenda.

One former senior adviser in Number 10 told Sky News that “without the authority of the prime minister and the proximity to him, this ‘envoy’ role will not be a serious position in government”.

Deaths in the Channel are now troublingly familiar

Deaths in the Channel have now become troublingly familiar.

We are no longer shocked, or even very surprised, when people die while trying to get from France to Britain in these unsuitable inflatable boats. But what happened today resonates on two levels.

As humans, we should be shocked that people die in this way, particularly when a small child is trampled – a grotesque way for a young life to end.

And note that, once a group of passengers, as well as the dead child, had been taken off, the boat continued on its way. These journeys can be brutal, dangerous and callous.

Secondly, for politicians, on both sides of the Channel, there is that pressure to do something, and to be seen to do something.

The Rwanda plan has gone and won’t come back. The promotion of Michel Barnier to become French prime minister could be the catalyst for Paris to take a more proactive view against migration.

It’s easy to think that would help the problem in the Channel, but Mr Barnier’s focus will be on those entering France – not those leaving it.

Many in France blame the British for what they see as a lax benefits system, and for denying asylum seekers any opportunity to register their claim before reaching British shores.

The people under pressure are Sir Keir Starmer and Yvette Cooper, and their promises to tackle cross-Channel migration by being tough on people smugglers.

The more tragedies we see, the more people who cross, the greater the focus on whether those promises are fulfilled.

The owner of an XL bully that was mistakenly euthanised by police has revealed he had been waiting for a call to collect the family pet when he instead learned he had been put down due to an “administration error”.

Lancashire Police said it has given the family an “unreserved apology” for euthanising the seized dog, named Bruno, while the owners were in the process of applying for an exemption to keep him.

Bruno’s owner, Connor Halliwell, told Sky News he is “devastated… because I was waiting for him to come home”.

The dog was at a police station for four weeks, during which Mr Halliwell, 27, from Morecambe, tried to contact officers to find out what was happening.

He said: “They went to go and see the dog and do an assessment on the dog and see if he was really good and calm, and he was, so I got a phone call about that, saying, ‘we’ve had some good news about Bruno – he’s been brilliant and passed the assessment’.

“A couple of weeks later, I didn’t have a phone call so I got hold of them myself, and I had to go to a meeting at the police station with a sergeant.”

That’s when he was told Bruno had been put down due to an admin error.

“I was waiting for messages, emails, saying, ‘you can come and see Bruno now or we can drop him off at your house’. I was just waiting for a call,” he said.

Lancashire Police said it has introduced a process “to ensure the same mistake cannot be made again”.

But Mr Halliwell suggested he was not going to let the matter drop.

“I’m going to take it further,” he told Sky News, adding he would be talking to his MP Lizzi Collinge to see how she could help.

“I’m feeling devastated, upset, and everything else,” he said. “I don’t know how they can get it wrong.”

He said there was nothing “vicious” about Bruno, and revealed some negative comments had been made about the family pet on social media.

“We’ve had a few comments saying, ‘you should put Bruno with the other dogs that have been killed and shot and stabbed, in a graveyard full of animals’,” he said.

“They don’t know Bruno’s background,” he added, describing the two-year-old as a “softie”.

“He was a big dog, he was a beautiful dog, he was good with kids,” he said.

From 1 February, it became a criminal offence to own the XL bully breed in England and Wales without an exemption certificate.

Anyone who owns one of the dogs must have had the animal neutered, have it microchipped and keep it muzzled and on a lead in public, among other restrictions.

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In a statement, Lancashire Police said: “In August we seized an XL bully dog from an address in Morecambe as part of our powers under the Dangerous Dogs Act, as XL bully dogs are a banned breed.

“A file was being prepared for consideration of the owner being prosecuted for the relevant offences.

“However, unfortunately, due to an administration error, the dog was subsequently euthanised before the court hearing.”

Ms Collinge, MP for Morecambe and Lunesdale, has demanded answers over the incident.

“This should be a ‘never event’ and I have taken this issue up directly with the police,” she told the BBC.