No 10 backs Chancellor Rachel Reeves and says she ‘is going nowhere’ after tearful appearance in Commons
Rachel Reeves has not offered her resignation and is “going nowhere”, Downing Street has said, following her tearful appearance in the House of Commons.
A Number 10 spokesperson said the chancellor had the “full backing” of Sir Keir Starmer, despite Ms Reeves looking visibly upset during Prime Minister’s Questions.
Politics latest: ‘A moment of intense peril’ for PM
A spokesperson for the chancellor later clarified that Ms Reeves had been affected by a “personal matter” and would be working out of Downing Street this afternoon.
Politics latest: Reeves looks visibly upset in Commons
UK government bond prices fell by the most since October 2022, and the pound tumbled after Ms Reeves’s Commons appearance, while the yield on the 10-year government bond, or gilt, rose as much as 22 basis points at one point to around 4.68%.
Downing Street’s insistence came despite Sir Keir refusing to guarantee that Ms Reeves would stay as chancellor until the next election following the fallout from the government’s recent welfare U-turn.
Tory leader Kemi Badenoch branded the chancellor the “human shield” for the prime minister’s “incompetence” just hours after he was forced to perform a humiliating U-turn over his controversial welfare bill.
Speaking at Prime Minister’s Questions, Ms Badenoch said: “This man has forgotten that his welfare bill was there to plug a black hole created by the chancellor. Instead they’re creating new ones.”
Turning to the chancellor, the Tory leader added: “[She] is pointing at me – she looks absolutely miserable.
“Labour MPs are going on the record saying that the chancellor is toast, and the reality is that she is a human shield for his incompetence. In January, he said that she would be in post until the next election. Will she really?”
Not fully answering the question, the prime minister replied: “[Ms Badenoch] certainly won’t.
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Welfare vote ‘a blow to the prime minister’
“I have to say, I’m always cheered up when she asks me questions or responds to a statement because she always makes a complete mess of it and shows just how unserious and irrelevant they are.”
Mrs Badenoch interjected: “How awful for the chancellor that he couldn’t confirm that she would stay in place.”
The prime minister’s watered-down Universal Credit and Personal Independent Payment Bill, aimed at saving £5bn, was backed by a majority of 75 in a tense vote on Tuesday evening.
A total of 49 Labour MPs voted against the bill – the largest rebellion in a prime minister’s first year in office since 47 MPs voted against Tony Blair’s Lone Parent benefit in 1997, according to Professor Phil Cowley from Queen Mary University.
After multiple concessions made due to threats of a Labour rebellion, many MPs questioned what they were voting for as the bill had been severely stripped down.
They ended up voting for only one part of the plan: a cut to Universal Credit (UC) sickness benefits for new claimants from £97 a week to £50 from 2026/7.
Ms Badenoch said the climbdown was proof that Sir Keir was “too weak to get anything done”.
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Ms Reeves has also borne a lot of the criticism over the handling of the vote, with some MPs believing that her strict approach to fiscal rules has meant she has approached the ballooning welfare bill from the standpoint of trying to make savings, rather than getting people into work.
Experts have now warned that the welfare U-turn, on top of reversing the cut to winter fuel, means that tax rises in the autumn are more likely – with Ms Reeves now needing to find £5bn to make up for the policy U-turns.
Asked by Ms Badenoch whether he could rule out further tax rises – something Labour promised it would not do on working people in its manifesto – Sir Keir said: “She knows that no prime minister or chancellor ever stands at the despatch box and writes budgets in the future.
“But she talks about growth, for 14 years we had stagnation, and that is what caused the problem.”
Politics
Kemi Badenoch accuses Sir Keir Starmer of ‘lying’ about Peter Mandelson prior to sacking him
Kemi Badenoch has accused Sir Keir Starmer of “lying to the whole country” about what he knew regarding Peter Mandelson’s correspondence with Jeffrey Epstein.
Lord Mandelson was this week stripped of his position as ambassador to the US amid fresh scrutiny over his years-long friendship with the convicted paedophile.
The prime minister initially defended the Labour peer but removed him from his post on Thursday after newly seen emails revealed he sent messages of support to Epstein even as he faced jail for sex offences in 2008.
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Lord Mandelson – the unanswered questions
The Times has now reported that Downing Street and the Foreign Office were aware of the emails on Tuesday – a day before Sir Keir gave Lord Mandelson his backing at Prime Minister’s Questions (PMQs).
In a post on X, Conservative leader Ms Badenoch wrote: “Looks like the Prime Minister and Labour MPs spent the week lying to the whole country about what they knew regarding Mandelson’s involvement with convicted paedophile Jeffrey Epstein.”
She continued: “If No 10 had those emails for 48 hours before acting, it means he lied at PMQs and ministers lied again about new additional information. These are yet more errors of judgment.
“The Prime Minister has very serious questions to answer. The only way to clear this up is full transparency about who knew what, and when.”
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Sources said Sir Keir was not aware of the contents of the emails when he told MPs he had “confidence” in Lord Mandelson.
A media enquiry outlining details of the messages between Lord Mandelson and Epstein was sent to the Foreign Office on Tuesday, and passed on to Number 10.
Sir Oliver Robbins, the permanent under-secretary at the Foreign Office, asked Lord Mandelson about the emails on Tuesday, but did not receive a response until the following day.
Sir Keir is understood not to have been aware of the contents of the emails until Wednesday evening.
Speaking to Sky News, one Labour MP has called for more information on what happened behind closed doors at No 10 this week.
Jo White, MP for Bassetlaw, in Nottinghamshire, said: “We cannot move on until we find out how he [Sir Keir] was not briefed properly before PMQs.”
“What he needs to do now is get on top and sort out this mess,” she said. “Suspend the whip from Peter Mandelson and expel him from the party, then have a transparent enquiry about what went wrong at No.10.”
This came as Sir Keir enjoyed some time away from Downing Street.
The prime minister was on Saturday pictured watching Arsenal face Nottingham Forest in a Premier League match at the Emirates Stadium.
Arsenal fan Sir Keir cheered on his side as they won 3-0. Pic: Reuters
Lord Mandelson’s exit came after less than a fortnight after another high-profile loss for the Labour government, as Angela Rayner was forced to quit as deputy prime minister and deputy Labour leader over her tax affairs.
As Sir Keir has faced a scandal-hit start to the month, a growing number of Labour MPs have begun calling his leadership into question.
Read more from Sky News:
Mandelson’s exit leaves Trump visit in the lurch
What we know about Mandelson-Epstein relationship
Lucy Powell, who is running to replace Ms Rayner as Labour’s deputy leader, has called for a “change of culture” at Downing Street.
“We’ve got a bit of a groupthink happening at the top, that culture of not being receptive to interrogation, not being receptive to differing views,” she told The Guardian newspaper.
Meanwhile, senior Labour MP Emily Thornberry has written to the new foreign secretary, Yvette Cooper, demanding answers about the vetting process for UK diplomats in the wake of Lord Mandelson’s sacking.
A man has admitted arson after a major fire at an MP’s constituency office.
Joshua Oliver, 28, pleaded guilty to starting the fire which destroyed the office of Labour MP Sharon Hodgson, at Vermont House in Washington, Tyne and Wear.
The fire also wrecked a small charity for people with very rare genetic diseases and an NHS mental health service for veterans.
The guilty plea was entered at Newcastle Magistrates’ Court on the basis that it was reckless rather than intentional.
Hodgson, who has been an MP since 2005, winning her seat again in 2019. Pic: Reuters
The Crown did not accept that basis of plea.
Oliver, of no fixed address, had been living in a tent nearby, the court heard.
Northumbria Police previously said it was “alerted to a fire at a premises on Woodland Terrace in the Washington area” shortly after 12.20am on Thursday.
“Emergency services attended and no one is reported to have been injured in the incident,” it added.
Drone footage from the scene showed extensive damage to the building.
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A spokesperson for the Crown Prosecution Service said: “Our prosecutors have worked to establish that there is sufficient evidence to bring the case to trial and that it is in the public interest to pursue criminal proceedings.
“We have worked closely with Northumbria Police as they carried out their investigation.”
Oliver was remanded in custody and will appear at Newcastle Crown Court on Tuesday, 14 October.
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