Reeves Rearguard Continues — Allies Warn Bond Markets Reject Miliband
Chancellor Rachel Reeves’s backbench-lobbying push continues this weekend. Reeves has told friends she would like to stay in the chancellorship even under a new prime minister, and her allies are urging MPs to back her if Sir Keir Starmer is replaced later this year. “The biggest fear for the bond markets and the unions is Ed Miliband,” one Labour MP close to Reeves said. “I am concerned that we may lose everything if a new leader sacrifices the chancellor for promises and new alliances they are currently forging with MPs who fancy the job for themselves.” Friends of Reeves believe there is a world in which she survives the transition to a Burnham premiership precisely because it would reassure the markets.
Reeves this week announced her cost-of-living package — free bus travel for children over the summer holiday, cancelling a planned 5p rise in fuel duty, a VAT reduction from 20% to 5% on tickets for summer attractions (theme parks, zoos and museums), the removal of import tariffs from 100 food items, a VAT cut on children’s meals, and a £120 million support package for the ceramics industry largely based in Stoke-on-Trent. The Stoke component is politically specific: Stoke was won by Boris Johnson’s Tories in 2019, taken back by Labour in 2024, and is now a Reform UK target. Inflation has slowed to 2.8% — the lowest in over a year — with the Bank of England expected to keep interest rates on a downward path.