Prime Minister Keir Starmer has publicly reaffirmed his confidence in Chancellor Rachel Reeves following the announcement of an ethics inquiry into her failure to obtain a landlord licence for a London rental property. Despite rising political pressure and calls for accountability, Starmer insisted that the issue was a “genuine mistake” rather than a breach of integrity, signalling his intention to keep Reeves in post as the government faces mounting scrutiny over ministerial standards.
A Show of Confidence
Addressing reporters during a visit to Birmingham on Wednesday, the Prime Minister sought to draw a line under growing controversy surrounding the Chancellor. “Rachel has my full support,” he said. “She has acted transparently, corrected the error promptly, and continues to focus on the job the country elected us to do.”
The tone of reassurance was deliberate. Reeves, a central figure in Starmer’s economic team, is widely seen as one of the government’s most competent ministers. Her reputation for meticulousness and fiscal prudence has underpinned Labour’s effort to project an image of economic credibility and ethical leadership.
Starmer’s public defence reflects both loyalty and pragmatism. At a time when Labour’s administration is still in its early months, the Prime Minister cannot afford a high-profile resignation that could distract from key policy goals and embolden opposition criticism.
Inside the Ethics Inquiry
The case stems from reports that Reeves’ rental property in south London lacked a valid landlord licence for several months — a legal requirement in certain boroughs to ensure housing standards and tenant protection. Upon discovering the oversight, Reeves’ office confirmed that she had applied for the necessary licence and informed the relevant authorities.
Nevertheless, the Independent Adviser on Ministers’ Interests, Sir Laurie Magnus, announced that his office would review the incident to determine whether Reeves breached the Ministerial Code. The investigation, expected to take several weeks, will assess whether she exercised “due diligence” and whether her response was consistent with the principles of openness and accountability outlined in the code.
While the inquiry’s scope is relatively narrow, its timing is politically sensitive. With Labour preparing its first major budget and public expectations high, any suggestion of impropriety within Cabinet ranks risks undermining Starmer’s message of “clean government.”
Political Reactions Divide Westminster
Reaction across Westminster has been predictably polarized. Opposition parties have accused the government of hypocrisy, citing Labour’s earlier criticisms of Conservative ministers over ethical lapses.
Shadow Chancellor Jeremy Hunt said the situation “raises serious questions about judgment,” arguing that the public would expect a minister responsible for national economic policy to be “fully compliant with basic housing laws.” Reform UK’s spokesperson, meanwhile, said the controversy showed that “the political elite talk about fairness but live by a different set of rules.”
Within Labour, however, the mood has been largely supportive. Cabinet colleagues have defended Reeves’ integrity, describing the issue as a “minor administrative oversight.” One senior aide told journalists, “Rachel reported the issue herself, took immediate steps to put it right, and has cooperated fully. That’s exactly how the system should work.”
The Stakes for Starmer’s Government
For Starmer, the episode represents his first significant test of leadership in handling ministerial discipline. Since taking office, he has positioned himself as the restorer of trust in government after years of controversy surrounding political ethics. He has repeatedly pledged to operate a “clean and transparent administration,” insisting that ministers must hold themselves to the same standards as the public.
Allowing Reeves to remain in her role signals that Starmer believes intent and proportionality matter — that an unintentional licensing lapse does not equate to misconduct. Yet it also leaves him vulnerable to accusations of inconsistency should future cases arise involving other ministers.
Political analysts suggest the Prime Minister is taking a calculated risk. “Starmer has built his brand on integrity, so any ethical question is potentially damaging,” said Dr. Sarah Hall, a politics lecturer at King’s College London. “But dismissing Reeves over something that appears administrative rather than deceitful could look excessive and destabilizing.”
Public Sentiment and Perception
Public reaction has been mixed. Early polling conducted by several media outlets indicates that while a majority of respondents view the error as “minor,” around a third believe Reeves should be formally reprimanded to set a precedent.
The distinction between legality and perception has become a defining challenge for modern politicians. In an era where transparency is demanded at every level, even small infractions can escalate into major reputational crises. For Starmer, managing that perception may prove as critical as managing policy.
Media coverage has also reflected this tension. Some commentators argue that the controversy has been “overblown” compared with more serious past breaches of ministerial conduct. Others contend that Labour’s emphasis on ethics invites greater scrutiny — that holding others to high standards means being held to them in turn.
Starmer’s Balancing Act
Behind the scenes, senior Labour strategists have reportedly urged the Prime Minister to stay firm in his support for Reeves, warning that forcing her resignation could derail the government’s economic agenda. The upcoming fiscal statement, expected to outline tax reforms and investment priorities, is heavily associated with Reeves’ vision for “sustainable growth.”
Losing her now would not only disrupt Treasury operations but also project instability within the Cabinet. “The Prime Minister knows that firing your Chancellor in the first six months of government would send the wrong signal to the markets and the public,” said one Whitehall source. “This is a test of judgment, not loyalty.”
Starmer’s allies argue that the Prime Minister is maintaining consistency by allowing due process to run its course. “He’s not sweeping it under the rug,” said another aide. “He’s allowing the ethics adviser to investigate, while making it clear that one error does not define a person’s integrity.”
The Broader Ethical Landscape
The controversy comes amid renewed debate about ministerial accountability and the adequacy of current oversight mechanisms. Transparency campaigners have long argued for stronger enforcement powers for the ethics adviser, whose findings are non-binding and ultimately dependent on the Prime Minister’s discretion.
Critics say this structure allows political calculations to override moral ones. Supporters of reform propose establishing an independent ethics commission with statutory authority to impose sanctions, similar to models used in other democracies.
For now, however, Starmer’s decision to stand by Reeves will likely shape public expectations of how his government handles ethical challenges. A firm yet measured approach could reinforce his image as pragmatic and fair-minded. But if future scandals emerge, this episode could be cited as evidence of leniency.
The Road Ahead
As the ethics inquiry proceeds, Reeves has remained publicly focused on her economic brief, avoiding media interviews and concentrating on preparations for the forthcoming fiscal statement. Treasury officials describe her as “determined and unflustered,” viewing the investigation as a distraction rather than a threat.
For the Prime Minister, the matter is far from over. Even if Reeves is cleared, the opposition will continue to frame the episode as symbolic of the difficulties inherent in maintaining high ethical standards in government. If she is found to have breached the code — however minor — Starmer will face renewed calls to act decisively.
Ultimately, his handling of the case will be judged not only by political insiders but also by the wider public, who voted for Labour on promises of competence and integrity.
As one senior commentator noted this week, “This is not just about Rachel Reeves’ licence. It’s about whether Starmer’s new government can convince the country that it really does play by the rules — even when the rules are inconvenient.”
