Reeves Supports Burnham for Prime Minister
Rachel Reeves has expressed her support for Andy Burnham to become the next prime minister, despite reports suggesting she may be reassigned from her current role as chancellor if Burnham assumes Labour leadership.
In an interview with the BBC, Reeves described her friendship with Burnham and did not dismiss the possibility of accepting a less senior cabinet position.
“I’m supporting Andy to be prime minister,”she stated.
When questioned about reports that Burnham might offer her a diminished role in his cabinet, Reeves responded,
“I’m not going to pre-empt the decisions that the new prime minister will make. I’m backing Andy. I think he’d be a great prime minister, but those are his decisions, not mine to make.”
Fiscal Policy and Defence Spending
During a speech at the British Chamber of Commerce’s global annual conference on Thursday, Reeves affirmed that the fiscal rules she implemented would remain intact under Burnham’s leadership, describing them as
“a good thing.”
Asked by Sophy Ridge, the presenter, whether she had
“unfinished business,”Reeves defended her record but identified fiscal devolution and business rates reform as areas for further progress.
She also noted that her fiscal rules permit increased borrowing for defence. This comes amid reports that senior government officials plan to lobby a new prime minister to revisit the concept of “war bonds” to finance higher defence spending, a proposal traditionally opposed by the Treasury.
Reeves indicated that the forthcoming defence investment plan, to be published before Burnham’s premiership begins, will involve
“more money, spent more effectively.”
When asked if categorizing defence spending as investment could enable additional borrowing, Reeves replied,
“That’s exactly what my fiscal rules allow. We do treat now, for the first time ever, day-to-day spending and capital spending differently because of the fiscal rules.”
She emphasized that defence qualifies as capital investment and stressed the importance of securing better value for money through cooperation with NATO allies, particularly European members.
“Also, what is really crucial is that we get better value for money for our defence spending, which is why cooperation with our Nato allies, especially our European Nato allies, is really important.”
Political Positioning and Support
Reeves, the first female chancellor following Labour’s 2024 landslide election victory, has been consolidating her position amid indications that Burnham is likely to become the next prime minister.
She was absent from outgoing prime minister Keir Starmer’s resignation speech but attended Burnham’s Westminster Hall rally on Monday. A Labour source noted that while her chief of staff was visible among Starmer supporters, Reeves’s absence was conspicuous. The source commented,
“Rachel talking herself into a job is quite mad.”
Reeves assured the BBC of her dedication to Starmer, with whom she has worked closely since his tenure began at No 10.
“I’ve been by his side for six years now as shadow chancellor and then as chancellor of the exchequer. I know that whoever is prime minister and chancellor in the future will inherit a stronger economy than the one I inherited two years ago.”
Lobbying Efforts and Cabinet Speculation
Her endorsement of Burnham follows reports that one of Reeves’s senior aides has encouraged major UK companies and trade associations to lobby Burnham to retain her as chancellor.
According to , Katie Martin, appointed as Reeves’s business adviser in January, reportedly contacted several large firms in insurance, banking, defence, and other sectors this week advocating for
“stability” and “continuity.”
Speculation about Burnham’s choice for chancellor has intensified as his path to 10 Downing Street becomes clearer. The appointment of the next chancellor is viewed by MPs as a defining indicator of Burnham’s intended approach, signaling how radical his premiership might be.
Burnham’s supporters are divided, with a briefing conflict emerging between proponents of former health secretary Wes Streeting and those aligned with energy secretary Ed Miliband.
Some allies regard Streeting as a reassuring figure for the business community and fossil fuel sector, while others advocate for Miliband, believing he is more likely to endorse radical policies and push reforms.
Within Labour, some caution against appointing Miliband. Darren Jones, chief secretary to the prime minister, suggested Miliband might not meet the criteria for a new chancellor. Jones stated that any new chancellor should not attempt to
“control” the prime ministerand must reassure markets, trade unions, MPs, and the public.
Burnham’s Progress and Other Potential Candidates
Burnham advanced closer to leading the Labour party on Wednesday after securing key support.
Former armed forces minister Johnny Carns, who resigned earlier this month over defence spending concerns, has not ruled out entering the leadership race. On social media Wednesday evening, Carns emphasized the need for a comprehensive debate on the country’s direction, stating,
“a proper debate about where we go next. Not a reshuffle. Not a few degrees of course correction. The big, difficult, honest choices we’ve spent 30 years avoiding.”
