Rachel Reeves faced humiliation after she backtracked over her illegal letting blunder.
The Chancellor was on the ropes with calls for her to be sacked following an extraordinary day of contradictory statements.
On Thursday night the Prime Minister’s ethics adviser was weighing up whether to launch an investigation into the row and whether Ms Reeves broke the Ministerial Code.
The Daily Mail exclusively revealed on Wednesday night that the Chancellor had been renting out her family home without a licence since entering Downing Street.
Ms Reeves had claimed that she and her husband, Nicholas Joicey, were unaware they needed to secure a ‘selective’ rental licence.
But emails released by No10 revealed extensive conversations between Mr Joicey and their letting agent in which they were informed of the need for a licence.
Ms Reeves conceded in a letter to the Prime Minister yesterday that she accepted ‘it was our responsibility to secure the licence’.
She said: ‘Today the letting agency and my husband have found correspondence confirming that on 17th July, 2024, the letting agent said to my husband that a Selective Licence would be required and agreed that the agency would apply for the licence on our behalf.
Rachel Reeves, pictured with husband Nicholas Joicey, was on the ropes with calls for her to be sacked following an extraordinary day of contradictory statements
The Daily Mail exclusively revealed on Wednesday night that the Chancellor had been renting out her family home (pictured) without a licence since entering Downing Street
‘They have also confirmed today they did not take the application forward, in part due to a member of staff leaving the organisation.
‘Nevertheless, as I said yesterday, I accept it was our responsibility to secure the licence. I also take responsibility for not finding this information yesterday and bringing it to your attention.’
But her contradictory claims led to fresh calls for ethics chief Sir Laurie Magnus to investigate.
Meanwhile the letting agency involved in Ms Reeves’s rental arrangements for her family home in Dulwich, south London, attempted to shoulder blame for the ‘oversight’.
Harvey & Wheeler said the property manager responsible for applying for the licence on her behalf had ‘suddenly resigned’ before the tenancy began.
But the firm added they ‘do not normally apply for licences on behalf of our clients; the onus is on them to apply’.
Tory leader Kemi Badenoch said night that it was still Ms Reeves’ ‘duty’ to ‘make sure that something has been followed’.
And she told the Mail: ‘In Opposition, Keir Starmer was always first out of the blocks calling for Conservatives to be sacked.
Reeves is pictured smiling as she leaves Downing Street on Thursday
Tory leader Kemi Badenoch said night that it was still Ms Reeves’ ‘duty’ to ‘make sure that something has been followed’
‘Now he’s ignoring the evidence that Rachel Reeves broke the law, because his flagging Government can’t handle a third resignation in as many months.
‘As always with Labour it’s one rule for them, and another for the rest of us. This weak Prime Minister needs to stop the cover up, order a proper investigation into Reeves, and have the backbone to accept that if it shows she’s broken the law, she has to go.’
Sir Keir desperately tried to prop up Ms Reeves when the Mail broke the story, with the PM’s independent ethics adviser saying her ‘inadvertent’ failure to secure the correct licence did not warrant further investigation.
But No10 refused to say what evidence Ms Reeves had provided to Sir Laurie to back up her claim that she had not been made aware of the licencing requirement.
Downing Street also repeatedly refused to say whether the Chancellor’s actions were in breach of the Ministerial Code.
Ms Reeves failed to obtain a landlord licence when she placed her property in Dulwich, south London, on the rental market last year as she moved into 11 Downing Street.
The four-bedroom detached house was listed for £3,200 a month, and her register of interests states she has received rental income since September 2024.
Southwark Council, the local authority, requires that private landlords in certain areas – including where Ms Reeves’ house is located – obtain a ‘selective’ licence to rent out their property.
In a second letter to the Prime Minister in the space of 24 hours, the Chancellor wrote to ‘update’ Sir Keir Starmer over the blunder that has plunged her into jeopardy
But the Chancellor failed to do so – and hastily applied for a licence following inquiries by the Mail.
Ms Reeves said it was an ‘inadvertent mistake’, and she apologised to the Prime Minister for the error.
But the speed of Sir Laurie’s decision not to investigate left Downing Street facing even more questions over the extent to which the mistake had been probed.
A spokesman for the Prime Minister insisted that the Ministerial Code sets out that an apology is a ‘sufficient resolution’ in certain cases.
But they repeatedly declined to say whether the standards rules had been breached, or if the Prime Minister or independent watchdog Sir Laurie had seen evidence of Ms Reeves’ version of events.
The spokesman, asked why Sir Keir had accepted Ms Reeves’ reason for the breach, said: ‘Regrettably she was not aware the licence was necessary, did not obtain the licence before renting the property out.
‘She’s explained it was inadvertent mistake and as soon as it was brought to her attention, she took immediate action and applied for the licence… the Ministerial Code makes clear that in certain circumstances, in consultation with the independent adviser, an apology is a sufficient resolution.’
Asked whether the Prime Minister, a former director of public prosecutions, believed that ignorance of the law was a defence, the No10 spokesman indicated he did not.
But he rejected suggestions that the Chancellor had got away ‘scot-free’ after a ‘stitch-up’ between Sir Laurie and the Prime Minister to avoid spooking the markets.
Southwark Council, like many other local authorities, requires that private landlords in certain areas obtain a ‘selective’ licence.
This has applied to most private residential properties rented to single families or unrelated tenants in the borough since November 2023.
They cost £900 and landlords must submit documents proving their property is fit for purpose, including gas, electrical and fire safety certificates, floor plans and tenancy agreements.
Failing to obtain a licence when required is a criminal offence and can be punishable with an unlimited fine on prosecution, a fine of £30,000 as an alternative to prosecution, or the landlord could be ordered to pay back up to 12 months’ rent.
No10 said Sir Keir retains ‘full confidence’ in Ms Reeves, and said that she would still deliver the Budget on November 26.
