Keir Starmer reshuffle: Lammy made Deputy PM as Rayner quits in standards row

Starmer’s reset after Rayner’s resignation

Keir Starmer has kicked off the most dramatic shake-up of his top team since entering No 10, triggered by Angela Rayner’s sudden resignation over a breach of the ministerial code. The deputy prime minister, who also held the housing brief and served as Labour’s deputy leader, stood down after the government’s standards adviser found she underpaid stamp duty on a flat she bought in Hove, East Sussex.

Rayner paid the standard rate on the purchase in May, following advice that it was treated as her main residence because her family home in Ashton-under-Lyne was held by a trust for her disabled son. Later, officials concluded she should have paid the higher rate. Sir Laurie Magnus, the independent adviser on ministers’ interests, ruled this a breach, prompting Rayner’s exit from three roles at the heart of government and the party.

The departure left a gap at the top of Starmer’s operation and forced a strategic decision: move quickly and decisively, or risk drift. No 10 chose speed. To steady nerves in the City, Chancellor Rachel Reeves was confirmed early on as staying put. Her continuity is a clear signal to markets that fiscal plans, spending reviews, and the government’s growth push remain on track.

The biggest switch came with David Lammy. Until now the foreign secretary, he has been named justice secretary and is also taking on the title of deputy prime minister. The pivot is striking. Starmer had told allies as recently as November that Lammy would be in the Foreign Office for the full term. Lammy spent the past year building relationships abroad, including with figures on the US right such as Donald Trump and JD Vance. Now he moves into a department grappling with prison capacity, court backlogs, and long-running debates over human rights law. As deputy PM, he becomes the prime minister’s de facto second-in-command, coordinating across Whitehall and fronting policy delivery.

Several ministers are out. Ian Murray has been removed as Scotland secretary. Lucy Pow, the leader of the House, is also leaving government. With both Pow and Rayner gone, two Greater Manchester voices at the cabinet table have vanished at once. Separate reports suggest the sister of Chancellor Reeves has also been dismissed from a government post, though Downing Street has not set out the full list of changes publicly.

This is not just a personnel shuffle. The government is reshaping departments to reflect its priorities. Work and Pensions is being paired more closely with skills policy, which had sat in Education. The aim is to line up welfare-to-work, retraining, and employer needs in one chain of command, a move officials hope will raise productivity and get more people into good jobs.

What this means for policy, politics, and power

Starmer has preferred continuity since taking office, arguing that stable teams deliver better results than constant churn. This moment breaks that pattern. It is a reset built under pressure: a standards case at the top of government, a vacancy in a central domestic brief, and a need to show the public that delivery will not stall.

On justice, Lammy inherits thorny problems. The prison estate is near capacity, with emergency measures already in play to manage numbers. Crown court delays mean victims and defendants can wait months for trials, feeding costs and public frustration. Legal aid remains a battleground. Any progress here will be measurable—fewer backlogged cases, more court sitting days, better outcomes for victims—so Lammy’s performance will be judged in real time.

The deputy PM title gives Lammy extra clout to push those fixes and corral departments that need to help, especially the Home Office and Treasury. It also plugs a political hole left by Rayner. She was a key communicator for the government and the party, often tasked with taking the fight to opponents. Expect Lammy to take a larger share of those set-piece media and parliamentary moments, while No 10 elevates other strong performers to share the load.

Foreign policy is now an open question. Moving a foreign secretary mid-term usually slows momentum. New ministers need time to establish rapport with allies, shape briefings, and set priorities. That risk is baked into the decision. Starmer is betting the domestic payoff outweighs the short-term turbulence, especially with public services under strain and economic growth still modest.

Scotland will watch closely after Ian Murray’s exit. The post of Scotland secretary is the UK government’s main bridge to Edinburgh on everything from fiscal frameworks to green investment. A change at the top could reset relations—either more cooperative or more combative—depending on who takes the role and how quickly they move to rebuild channels with Holyrood.

Parliamentary management will also shift. The leader of the House orchestrates the Commons timetable: bills, statements, and opposition days. With Lucy Pow leaving, the government needs a steady hand to steer a crowded legislative agenda—planning reform, criminal justice measures, welfare-to-work changes—through tight timeframes and a restive chamber.

Rayner’s resignation as Labour’s deputy leader sets up a separate political contest inside the party. Under Labour’s rules, the deputy leader is elected, not appointed. A race will test alliances across the membership, affiliated unions, and MPs. The winner will help define the party’s tone and priorities beyond Westminster—especially on housing, where Rayner had built a profile on planning reform, renters’ rights, and building targets.

The standards case that sparked all this matters beyond one resignation. Ministers are expected to meet both the letter and the spirit of the rules. Stamp duty rules can be complex—especially where trusts are involved—but Magnus’s verdict underscores a baseline expectation: if in doubt, err on the side of paying more, disclose fully, and correct early. Starmer’s rapid response is designed to show that the system polices itself.

There is a wider Whitehall logic to the departmental changes. Bundling skills with Work and Pensions creates a single pipeline: identify people out of work, train them with short, employer-led courses, and match them to the jobs local economies actually need. If it works, the payoff could be higher employment and faster productivity growth. If it stalls, the government will face awkward questions about delivery capacity and whether the civil service has the bandwidth for big structural change while implementing new laws.

Reeves staying at the Treasury is the anchor for all this. Budgets, spending rounds, and industrial policy rest on that continuity. When governments change personnel at pace, investors get jumpy. Keeping the chancellor in place is meant to dampen that risk and signal that tax and spending plans are steady, even as other pieces move.

The political balance inside cabinet has shifted too. With Rayner and Pow gone, northern and specifically Greater Manchester representation drops. That is sensitive for a party that won big in former industrial areas and must keep those voters engaged. Expect Starmer to compensate by elevating voices with strong regional ties or by putting more focus on local growth deals outside the South East.

The next 72 hours will set the tone. Key unanswered questions remain: Who takes over at Housing, a brief central to planning and housebuilding? Who steps into the Foreign Office and the Leader of the House? How quickly will the government publish the full map of departmental responsibilities after the skills-and-welfare merger?

What is clear is the intent. This Keir Starmer reshuffle is about control and momentum—showing that standards matter, moving heavy-hitters into problem departments, and reorganising machinery to push jobs and growth. It’s a gamble that near-term disruption will buy long-term delivery.

• Angela Rayner resigns as deputy PM, housing secretary, and Labour deputy leader after a ministerial code breach over stamp duty.
• David Lammy moves from foreign secretary to justice secretary and becomes deputy prime minister.
• Chancellor Rachel Reeves remains in post to reassure markets and maintain fiscal continuity.
• Ian Murray is sacked as Scotland secretary; Lucy Pow leaves as leader of the House.
• Reports suggest a dismissal involving the chancellor’s sister; No 10 has yet to detail all changes.
• Whitehall revamp links Work and Pensions with skills policy from Education to turbocharge jobs and training.
• Labour now faces a deputy leadership election under party rules.

First reshuffle of 2025 or not, the message is unmistakable: the government wants to prove it can correct course fast—and keep its policy promises intact.