Rachel Reeves sacked as Chancellor amid major purge of Starmerites with London MPs David Lammy and Steve Reed also out of Cabinet

By MARTIN BECKFORD, POLICY EDITOR Published: 17:46, 20 July 2026 | Updated: 17:54, 20 July 2026 Rachel Reeves was sacked as Chancellor in a major purge of Starmerites from the Cabinet. She became the most high-profile casualty of Andy Burnham’s plan for a new direction at the top of Government after weeks of briefings that she hoped to cling on. Ms Reeves was offered a lesser role by the incoming Prime Minister, with reports that she was even given the opportunity to become Defence Secretary just weeks after she was accused of depriving the armed forces billions of pounds needed for rearmament. But she turned down the ‘big’ job offer and will now sit on the Labour backbenchers alongside her close ally Sir Keir Starmer after he left Downing Street on Monday. Ms Reeves repeated her claim that her two years in No 11 had been a success, writing on social media: ‘The economy today is stronger, fairer and more resilient because of the choices we have taken as a Labour Government over the past two years. ‘Stability restored, investment delivered and reform to our economy under way. I said when I was appointed Chancellor that I would judge my time in office if the lives ordinary working class people have been improved. I’m proud to say that they have.’ But Shadow Chancellor Sir Mel Stride said: ‘I’m afraid that her legacy is one of wholesale mismanagement of our economy and leaving us with more challenges.’ Ms Reeves and Sir Keir will be joined on the back benches by half a dozen ministers who until last week were sitting round the Cabinet table with them, including former Deputy Prime Minister and Justice Secretary David Lammy. Sir Keir Starmer embraces his close ally Rachel Reeves as he left No 10 on Monday  He implied that he too had hoped to avoid the sack, writing on Twitter/X: ‘I would have been proud to continue serving in Cabinet. ‘But a new Prime Minister is entitled to build his own team, and I wish Andy Burnham and the new Cabinet every success.’ Steve Reed - like Mr Lammy a London MP - left his role of Communities Secretary with a pointed remark to Mr Burnham about the Labour coup that led to Sir Keir being ousted. He wrote to the new party leader: ‘Keir Starmer showed loyalty to me by appointing me to his Cabinet. I make no apology for returning that loyalty. ‘It’s what expected of functioning teams, and I hope that those who did not show loyalty to Keir will now show it to you. I’m proud I acted with integrity at every step over the turbulent past few months.’ In what will also be seen as a swipe at Mr Burnham’s focus on the north of England, Mr Reed added: ‘You can’t make funding fairer for the rest of England by making it unfair on Londoners. ‘I’m proud to be a London MP and I’ll always fight to ensure London is treated fairly as you explore new models of devolution, taxation and funding.’ As expected Sir Keir’s longstanding friend Lord Hermer – blamed for the Chagos islands surrender and the hounding of Northern Ireland veterans – was removed as Attorney General. He wrote: ‘I’ve been so lucky to be a part of Keir’s team, as he delivered for the public at home while rebuilding the UK’s reputation abroad, in particular on the rule of law.’ Shadow Justice Secretary Nick Timothy said: ‘Good riddance to a man who hounded British soldiers in court and refused to apologise for it. He took the side of foreign terrorists over our veterans. It's utterly damning that Labour ever thought he was fit to be Attorney General.’ Liz Kendall was removed as Science and Technology Secretary and in her statement said she had been ‘proud to stand up to Elon Musk’ as well as working on the social media ban for under-16s. Sir Keir’s right-hand man Darren Jones joined the exodus, writing: ‘Andy Burnham has called to tell me I won’t be a part of his new Cabinet.’ Peter Kyle was sacked as Business Secretary while Jo Stevens lost her job as Welsh Secretary.