UK ministers urge potential leader to keep Chancellor Reeves

In Westminster, there is significant discussion about whether Andy Burnham, a potential successor to Keir Starmer, should retain Rachel Reeves as Chancellor if he were to win a leadership contest. Some ministers believe that keeping Reeves in her post would provide crucial economic stability and reassure bond markets, especially given concerns about potential market jitters surrounding a Labour leadership change. One minister cited Reeves's handling of the economy as a reason interest rates have not risen further in response to geopolitical events.

Supporters of keeping Reeves argue that a change in both the Prime Minister and Chancellor would necessitate starting economic policy anew, and that Burnham's commitment to her fiscal rules already provides a foundation. Even some MPs who would prefer Reeves out of office acknowledge that Burnham keeping her would be politically pragmatic, though they might privately disagree with the long-term direction. Some MPs also blame the Treasury under Reeves for earlier policy missteps, such as proposed cuts to winter fuel handouts and welfare budgets, and controversial business tax revaluations.

Burnham himself announced plans to cut business taxes for pubs and music venues by 20 percent, funded by higher taxes on tech giant warehouses, a move that extends existing policies. While Reeves is reportedly focused on maintaining economic stability, some MPs believe her presence reassures bond markets. The possibility of Ed Miliband becoming Chancellor under a Burnham government is seen by some as a move that would concern financial markets.

Separately, the head of the data protection watchdog, John Edwards, continues to receive his £200,000 salary despite being on leave since February pending an investigation. Downing Street has dismissed claims of "two-tier policing" in the UK and also rejected suggestions of potential civil war over identity politics. Meanwhile, the EU and a 12-nation Asia-Pacific trade bloc, including the UK, are reportedly drafting commitments to avoid raising tariffs on each other amidst global trade tensions.