UK Chancellor Rachel Reeves may be forced to pay $80k after breaking rental rules
In the latest setback for Keir Starmer’s embattled Labour government, his chancellor has admitted she broke housing rules by unlawfully renting out her family home without a licence.
UK Chancellor Rachel Reeves could be forced to repay more than £40,000 ($80,000) in rent after admitting she broke housing rules by unlawfully renting out her family home without a licence.
In the latest setback for Keir Starmer’s embattled Labour government, Ms Reeves could be forced to pay compensation to the tenants of her four-bedroom house in Dulwich, south London, and could be prosecuted for the breach.
Sir Keir backed his finance minister after she apologised for “an inadvertent mistake” and said his independent ethics adviser had recommended “further investigation is not necessary” and he was “satisfied” that the matter could be closed.
In a letter to Sir Keir, Ms Reeves admitted she had failed to obtain the required “selective” rental licence for the south London home when she moved into 11 Downing Street after Labour won power in July 2024.
“This was an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the licence,” she wrote, adding “I sincerely apologise for this error”.
Southwark council, where Ms Reeves’s property is located, requires landlords to have a “selective” licence and renting without one is a criminal offence. Under the council rules tenants can apply for a refund of their rent during the period in which the property was let out without a licence.
Emerging just weeks after Angela Rayner resigned as deputy prime minister and housing secretary for underpaying property tax, the incident is another embarrassing blow for Sir Keir’s under-fire administration.
It follows a string of missteps by Sir Keir and his ministers as they struggle with immigration and other key policy areas, prompting surging support for Brexit champion Nigel Farage’s hard-right Reform UK party.
Ms Reeves’ rules breach also comes less than a month before she unveils a crucial budget, when she has conceded tax rises and spending cuts are likely amid meagre economic growth, high borrowing and stubborn inflation.
The UK Telegraph reported Thursday her ministry is considering hiking income tax, in a potentially toxic political move that would breach pre-election promises last year.
Sir Keir in his correspondence with Ms Reeves said a code governing ministerial behaviour “makes clear that in certain circumstances, an apology is a sufficient resolution”.
“It is regrettable that the appropriate licence was not sought sooner and it is right that you have taken the appropriate steps today to address this,” he added.
However Tory leader Kemi Badenoch urged him to “launch a full investigation”, saying if Ms Reeves had broken the law “he will have to show he has the backbone to act”.
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