Rachel Reeves has publicly thrown her support behind Andy Burnham to be the next prime minister, even as reports swirl that he could demote her from chancellor. The chancellor told the British Chambers of Commerce conference that Burnham backs her fiscal rules and that she hopes whoever is chancellor will "stick to what I'm doing because it is beginning to bear fruit."
But behind the scenes, the picture is different. "Not Rachel," a Burnham backer told the New Statesman. The prime-minister-in-waiting is expected to decide on his chancellor this weekend, with market uncertainty looming. The choice is personal and political, with the potential to trigger a market crisis if he gets it wrong.
“Rachel Reeves urges Andy Burnham to keep her as chancellor, but his allies say 'not Rachel' as he weighs Streeting or Miliband.”
The most obvious candidates to replace Reeves are Wes Streeting, from the centre right, and Ed Miliband, from the centre left. Streeting is a favourite with Ladbrokes and is seen as a protector against bond market hostility, having worked with Will Hutton and Andy Haldane. However, Streeting has neither lobbied nor asked for the job, and some worry Burnham might be nervous about having an ambitious neighbour.
Ed Miliband represents the centre left, but he faces a fierce caricature in the right-wing press and would be closely scrutinised by bond markets. A senior MP said of Miliband: "It's actually unfair, but the question is, can Ed get beyond the vicious caricature of him?"
Reeves, meanwhile, is fighting a "forlorn rearguard action," according to the New Statesman. She has been working her business supporters hard for words of support. At the BCC conference, she insisted Burnham backs her fiscal rules, designed to ensure day-to-day spending is funded by tax revenue by the end of Parliament. She claimed she brought stability, pride in her record on inflation and growth, and said the budget later this year will include reforms to business rates and fiscal devolution.
Burnham is the only contender to replace Sir Keir Starmer, who resigned after losing the support of Labour MPs. If no other challenger emerges, Burnham could take over as soon as 17 July. Reeves said that Burnham is a "great communicator" and that he will provide the vision the country needs. But whether she will be his chancellor remains unclear.