A cabinet reshuffle is coming: will it include Rachel Reeves?

Someone is out to get Rachel Reeves. “I don’t know what they are saying and of course none of them have gone on the record,” she said on Friday, after reports that her expenses claims were investigated when she worked at Halifax Bank of Scotland before she became an MP. The latest report included the story of a bottle of champagne bought on expenses for a colleague, which was allegedly never received. Reeves said she “submitted and had her expenses signed off in the proper way”, and that “no one ever raised any concerns about my expenses” when she was there. None of this is good for the chancellor. The allegations, including that she misstated how long she worked for the Bank of England, have been taken up by the BBC, which is usually careful in its reporting and has no ideological axe to grind.

So far, there is nothing that amounts to either a sacking offence or a resigning matter, but it is beginning to feel as if the prime minister might need to start thinking about what to do if there are further revelations. I have previously dismissed speculation that Keir Starmer would move Reeves because of her real or imagined policy failures. There is no way he could do so without undermining his own position – a point made with some force by Kwasi Kwarteng, who when he was chancellor warned Liz Truss that if she sacked him, she would be gone next. She went 11 days later.

But if the campaign to bring down Reeves succeeds, that would be a different matter. It is a prospect that adds to the reshuffle speculation that was already building. MPs often say that they are not interested in the tittle-tattle of who is up and who is down, but they always are, and the front-page lead story in The i Paper on Thursday was the talking point of the last day before the February recess in Westminster. That report named three ministers who are in danger of demotion: Richard Hermer, the attorney general; Lisa Nandy, the culture secretary; and Bridget Phillipson, the education secretary.

Lord Hermer has been under siege by the Conservatives and Reform for what they regard as his excessive reverence for human rights and international law. This is mostly unfair, but his record as a supporter of liberal legal causes makes it harder for Starmer to pose as tough on immigration. Some of his Labour colleagues are not impressed either. One cabinet minister was quoted, anonymously, by Patrick Maguire, the chronicler of the Labour government: “Richard seems to be under the impression that the government needs objective legal advice.” Beneath the sarcasm lies a serious point: good ministers do not always accept the first legal advice they are given — they push back against it, argue with it, demand a second opinion. They want lawyers who are creative in finding ways to do what they were elected to do.

It is less clear what Nandy is supposed to have done wrong, but it is said that she offended Starmer during the Labour leadership campaign five years ago when she was the rival candidate of the non-Corbynites. Phillipson is the most surprising of the three, having been talked up only recently by Blairites as a great hope for a reforming Labour government. Yet in office she seems to have yielded to officials in her department who have never liked academy schools and who have seized the chance to roll back the cross-party consensus in favour of them. If a reshuffle involves just those three, however, it hardly seems worth it. As John McTernan, Tony Blair’s former political secretary, once said: “A reshuffle must have a clear political purpose — or don’t do it. This is not a technical matter; it’s a demonstration of leadership.” That is why speculation about a reshuffle simply as a demonstration of prime ministerial power still seems premature. That does not mean that the speculation is pointless, however. On the contrary, it may illustrate some of the tectonic movements under the political landscape. One episode that shone a light on the hidden structures is recounted in Get In, Maguire and Gabriel Pogrund’s book about Labour’s road to power: it recounts the moment in 2022 when it seemed that Starmer and Angela Rayner might have to stand down if they were found by Durham police to have broken coronavirus law.

Urgent consultations by Shabana Mahmood, Labour’s campaign co-ordinator, established that the shadow cabinet would appoint John Healey, the shadow defence secretary, as a caretaker leader to oversee a leadership election. It was assumed that this would be between Wes Streeting and Rachel Reeves.

Since then, Reeves’s stock has fallen, and Rayner’s survival means that she would be Streeting’s rival if there were a vacancy at the top. Meanwhile, if there were a sudden vacancy at the Treasury, who would Starmer appoint? The choice is probably between Streeting, Pat McFadden, who was Reeves’s deputy in opposition, and the unassuming but trusted Healey.

What is telling, though, is that we don’t know. As McTernan said, “In contrast to most other modern Labour leaders, Starmer does not provide a running commentary to the Westminster Lobby”, he “stays silent, acts and then moves on”. Whenever it happens and whatever prompts it, Starmer’s first reshuffle is going to be a revealing moment.