LONDON (AP) - U.K. Treasury chief Rachel Reeves has officially apologized for breaking the law by renting out her London house without the necessary rental license. This incident has raised concerns amid ongoing scrutiny of the Labour Party’s handling of public finances.
After the Labour Party was elected in July 2024, Reeves and her family relocated from their south London residence to a government-owned apartment adjacent to Prime Minister Keir Starmer’s official residence on Downing Street. The Daily Mail reported that Reeves did not possess a rental license, which is required by the local authority, exposing her to potential prosecution or fines for her oversight.
In a letter addressed to Prime Minister Starmer, which was made public by his office, Reeves described the situation as "an inadvertent mistake" and noted that immediate steps had been taken to rectify the issue by applying for the necessary rental license. In response, Starmer stated that after consulting with the government’s ethics adviser, it was determined that no further investigation was needed. He expressed satisfaction with Reeves’ apology and indicated that the matter could be put to rest.
However, Conservative Party leader Kemi Badenoch has criticized Starmer’s decision as insufficient and has called for a comprehensive investigation into the matter. The Labour government is already facing significant pressure regarding public finances as Reeves prepares to deliver her annual budget statement on November 26.
The economic situation in the U.K. has proven challenging for the Labour Party, which has struggled to live up to its commitments of delivering growth. Persistent inflation and a gloomy economic forecast have frustrated efforts to mend strained public services and alleviate the burden of the cost of living crisis on citizens.
In light of the economic conditions, Reeves has suggested that she might need to reconsider a pre-election promise to refrain from increasing income tax or sales tax, acknowledging that the state of the economy is worse than initially anticipated following 14 years of Conservative rule.
This controversy over Reeves' rental practices follows previous scandals within Starmer’s government, further complicating its position. In September, Deputy Prime Minister Angela Rayner resigned after failing to pay adequate tax on a home purchase. Additionally, Starmer dismissed Britain’s high-profile ambassador to Washington, Peter Mandelson, due to his connections with the convicted sex offender Jeffrey Epstein.
The combination of these events has contributed to a tumultuous political climate for the Labour Party, raising questions about its governance and financial management ahead of the upcoming budget statement. As Reeves navigates these challenges, the Labour government faces intense scrutiny and the potential for further political fallout in the coming weeks.
