Rachel Reeves made a surprise, symbolic appearance this morning to aid the prime minister and health secretary Wes Streeting in setting out the government’s 10-year plan for a “Neighbourhood Health Service”.
The chancellor told her audience, gathered at a hospital in east London, that it was “great to be here today”. She said Labour would “always deliver on the priorities of ordinary working people” and ensure the NHS is “there for those who need it for the next 77 years and many more beyond that too”.
It was left to Keir Starmer and Streeting to outline the detail of the government’s “three-way plan” to “transform healthcare in this country”. They propose moving care into the community, digitising the NHS and focusing on sickness prevention.
The PM announced neighbourhood health services of “pioneering teams” will soon be rolled out across England. The goal is for patients to more conveniently access a full range of healthcare services close to home, and to shift care out of overstrained hospitals.
Starmer remarked: “The NHS should be there for everyone, whenever they need it.
“But we inherited a health system in crisis, addicted to a sticking plaster approach, and unable to face up to the challenges we face now, let alone in the future. That ends now. Because it’s reform or die.”
He added: “Our 10-year health plan will fundamentally rewire and future-proof our NHS so that it puts care on people’s doorsteps, harnesses game-changing tech and prevents illness in the first place.”
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In the chancellor’s contribution, there was no reference made to her tearful appearance at prime minister’s questions yesterday, which rocketed Westminster into a bout of feverish speculation as to her future.
But those scenes in the commons continue to occupy a central place in the news agenda as we approach the end of a torrid week for the prime minister. Starmer was duly forced to address the matter in the Q&A portion of his NHS presser today. Asked about the chancellor’s experience, Starmer said her tears came over a “personal issue” and that he “certainly won’t” speak for her or say anymore.
As for why he didn’t show support for the visibly distressed Reeves, Starmer pointed to the very nature of prime minister’s questions. He said: “In PMQs, it was like bang bang bang… that’s what it was yesterday, and therefore, I was probably the last to appreciate anything going on in the chamber.”
Speaking after the NHS event, Reeves addressed her tearful moment at PMQs for the first time, telling broadcasters that “clearly I was upset”.
She added: “It was a personal issue and I’m not going to go into the details of that.
“My job as chancellor at 12 o’clock on a Wednesday is to be at PMQs next to the prime minister, supporting the government and that’s what I tried to do.
“I guess the thing that maybe is a bit different between my job and many of your viewers’ is that when I’m having a tough day, it’s on the telly and most people don’t have to deal with that.”
Reeves’ appearance today, and the prime minister’s comments in the last 24 hours, are intended to serve as an incontrovertible, unmistakable symbol that the chancellor isn’t just staying put — but that she is an integral member of the government.
Starmer said as much in an interview with BBC Radio 4’s Political Thinking podcast, broadcast this morning. He is in “lockstep” with Reeves, he maintained, nodding to less cordial relationships between prime ministers and chancellors down the years.
The PM commented: “She’s done an excellent job as chancellor and we have delivered inward investment to this country in record numbers.”
He added: “She has done a fantastic job. She and I work together, we think together.
“In the past, there have been examples — I won’t give any specifics — of chancellors and prime ministers who weren’t in lockstep. We’re in lockstep.”
Speaking to Virgin Radio this morning in a live interview, Starmer declared that Reeves will stay as chancellor up to the next general election — and beyond if Labour wins it.
Starmer stated: “She is an excellent chancellor, she will be chancellor for a very long time to come, into the next election and beyond it. And she and I are absolutely committed to our fiscal rules and the economic stability that is so important to this country.”
It comes after the prime minister conspicuously refused to confirm that Reeves would be in post “until the next election” in response to a direct question at PMQs.
Starmer’s equivocation on this point, combined with the images of Reeves in tears, was interpreted as a signal that the chancellor could be on her way out. The episode contributed to the sense of instability that has engulfed the government in recent weeks. And the markets took notice.
Following PMQs yesterday, the value of the pound dropped and government borrowing costs rose, via the interest rate on both 10 and 30-year bonds. According to Reuters, “the yield on the 10-year government bond, or gilt, rose as much as 22 basis points on the day at one point, to 4.681%, as investors ditched British debt. It then recovered somewhat to 4.60%”.
All this came after the government’s huge climbdown on welfare — which did little to change expectations. Today, with Starmer having latched himself to Reeves in no uncertain terms, UK government bond markets have rallied.
This fluctuation is revealing on several fronts. Firstly, whatever Starmer’s instincts or anxieties, sometimes it is just better to answer the question. Had Starmer confirmed that Reeves would remain in post yesterday, he could have avoided some of the damaging speculation that has afflicted the government in the last 24 hours.
Speaking today, he has confirmed — with no caveat in sight — that Reeves is an integral member of his government. Why couldn’t he do so when the moment demanded?
Secondly, the saga shows how finely financiers are scrutinising Reeves’ status. Their reaction reflected the direct relationship between the chancellor’s emotional state and the state of the markets.
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I have commented before that Reeves is an exposed politician because she does not have a clear political base of support — aside from within No 10 itself. Reeves is the most disliked member of the cabinet among Labour activists (she has a net favourability rating of -27.84, according to LabourList); she is a frequent target of hostile briefing from Labour MPs; and her public approval ratings are dismal. Ipsos suggests they mirror the standing of Kwasi Kwarteng in the weeks following the 2022 mini-budget (51 per cent of Britons say that Reeves is doing a bad job). Meanwhile, Reeves’ record in office has raised difficult questions about her political judgement.
These were the facts that determined (and determine) the chancellor’s political weakness. Her political proximity to Starmer made any swift sacking untenable. But she was nonetheless counted as a liability.
It is now clear that Reeves does have a support base: the markets.
The chancellor is still seen as a symbol, a personification, of fiscal rectitude. An attempt to remove her, trader logic follows, would mean a shift to more borrowing under a chancellor whose standing better reflects Labour’s historic reputation.
Of course, financier fears that Reeves’ tears suggested a forthcoming departure were unfounded. But in so reacting, they revealed their preference: the market actually likes Rachel Reeves. At least, her hypothetical replacement is seen as less fiscally credible.
That is the supreme irony of the situation: a moment of acute political and emotional vulnerability has paradoxically strengthened the chancellor’s position.
Indirectly, the market movement yesterday could also serve as a signal to Labour MPs. They have been reminded of the precariousness of the UK’s financial position — and the importance of Reeves to it. In other words: undermining her with rival plans and negative briefings has consequences.
Of course, Reeves’ political authority has undoubtedly been diminished as a result of successive, expensive climbdowns. But the markets — and Downing Street’s damage limitation operation — have bound Starmer and his chancellor together, just when politics looked to be pulling them apart.
The PM knows he cannot risk spooking the markets, and so he has no choice but to go all in with Reeves. There is no manageable alternative. (A small problem, one supposes, is that Starmer appears a little passive. Whatever the reality, the reaction reads as though the PM has been bounced into backing Reeves after equivocating yesterday).
A more significant problem for Starmer is that, by signalling No 10 and No 11 are in “lockstep”, he will be inviting criticism of Reeves onto him. Meanwhile, the political and fiscal outlook is no rosier. Difficult decisions await and Reeves must make them. That is where she has come unstuck this parliament.
Indeed, the markets may have spoken, but her Labour sceptics remain unconvinced. For Reeves, winning their trust — or governing without it — will be the defining challenge of the difficult years ahead.
Josh Self is editor of Politics.co.uk, follow him on Bluesky here and X here.
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