Reeves Rearguard; Allies Warn Bond Markets Would Reject Miliband
Chancellor Rachel Reeves has launched a rearguard action to save her job this morning, telling friends she would like to stay in the post even under a new prime minister. Her supporters have been urging MPs to back her if Sir Keir Starmer is replaced later this year, saying she is the only candidate who can safeguard the country’s finances. Reports have suggested Andy Burnham is considering appointing Energy Secretary Ed Miliband as chancellor if he makes it to No 10. Reeves’ allies are warning that Miliband “would not be trusted by the bond markets, which set the government’s borrowing costs”. One Labour insider: “The fight over who gets to be chancellor is almost as important as that for prime minister.”
Although Burnham has not commented on who would be his chancellor if he were to win Makerfield and then succeed Starmer, Labour MPs believe Miliband and Reeves would be close to the top of his list. While Miliband has prioritised the green transition throughout his career, Reeves has tended to be more focused on the cost to taxpayers; the two clashed when Starmer and Reeves slashed Labour’s planned green energy scheme while in opposition. “The two may have served in the same cabinet and been close in the past, but they have very different instincts,” one Labour insider said in an interview. The chancellor question is the operational variable for gilt-market pricing through the Makerfield by-election cycle: a Reeves-stays scenario reads materially differently from a Miliband-replacement scenario.