rental

The letting agent which rented out Chancellor Rachel Reeves’ family home has apologised for an “oversight” which led to a failure to obtain the correct licence.

Gareth Martin, owner of Harvey & Wheeler, said the company’s previous property manager had offered to apply for a “selective” rental licence on behalf of their client – but this never happened as the individual resigned before the tenancy began.

He added: “We deeply regret the issue caused to our clients as they would have been under the impression that a licence had been applied for.”

Reeves has apologised for the “inadvertent mistake” but said she accepts “full responsibility”.

Downing Street has spent the day defending the chancellor, with a spokesman insisting the prime minister has “full confidence” in her.

Reeves put her four-bedroom south London home up for rent in July 2024, when Labour won the general election and she moved into 11 Downing Street.

The house falls in area where Southwark Council requires private landlords to obtain a selective licence at a cost of £945.

The chancellor said she first became aware that her property did not have the correct licence on Wednesday when the Daily Mail, who first reported the story, contacted her.

Reeves or her letting agent could face an unlimited fine if Southwark Council takes the matter to court.

The revelations come at a politically awkward time for Reeves, who is preparing for a Budget at the end of the month amidst speculation the government is planning to break a manifesto commitment not to raise income tax.

Reeves’ economic responsibility was a hallmark of Labour’s pre-election argument that they could be trusted with the nation’s finances.

But since then, questions about her personal judgement were raised after she accepted free concert tickets as well as thousands of pounds in donations for clothing.

Her political judgement was criticised after she imposed – and then reversed – cuts to the winter fuel allowance.

Errors in her CV further undermined her standing.

Now this adds to a growing list of charges at the chancellor’s door, and it is yet another day when the government completely lost control of the news agenda.

While the letting agent has taken responsibility, Sir Laurie Magnus, the ethics adviser whose findings have felled two previous Labour ministers, is now re-examining her case.

Sir Laurie was said to have been satisfied with Reeves’ explanation, but Downing Street has refused to say whether Magnus believed the chancellor broke the ministerial code.

He is now reviewing emails about the rental arrangements that were sent and received by the chancellor’s husband.

No 10 will be hoping the latest developments – and the apology from the letting agency used by Reeves and her husband – will bring this saga to an end.

Downing Street will still be worried this evening about how this all looks to voters.

In a letter to Sir Keir Starmer on Wednesday evening, she said “we were not aware that a licence was necessary”.

“As soon as it was brought to my attention, we took immediate action and have applied for the licence,” she wrote.

However, in a second letter to the PM on Thursday, Reeves said she had found correspondence confirming that the letting agent had told her husband a licence would be required and that the agency would apply for this on their behalf.

“They have also confirmed today they did not take the application forward, in part due to a member of staff leaving the organisation,” she wrote.

“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.

“As I said to you today, I am sorry about this matter and accept full responsibility for it.”

Reeves has published the emails, which confirm the letting agent agreed to apply for the licence once the new tenant moved in.

In a statement, Mr Martin, the agency’s owner, said: “We alert all our clients to the need for a licence.

“In an effort to be helpful our previous property manager offered to apply for a licence on these clients’ behalf, as shown in the correspondence.

“That property manager suddenly resigned on the Friday before the tenancy began on the following Monday.

“Unfortunately, the lack of application was not picked up by us as we do not normally apply for licences on behalf of our clients; the onus is on them to apply. We have apologised to the owners for this oversight.

“At the time the tenancy began, all the relevant certificates were in place and if the licence had been applied for, we have no doubt it would have been granted.”

The Conservatives have said the prime minister needs to “grow a backbone and start a proper investigation”.

Speaking on LBC, party leader Kemi Badenoch said “maybe it is the letting agents’ fault but it’s this the funny thing with Labour, it’s always somebody else’s fault.”

“Keir Starmer said law makers shouldn’t be lawbreakers, and he was very happy to chase every fixed penalty notice that occurred under the Conservatives,” she said.

“What Rachel Reeves looks like she has done is a criminal offence.

“They didn’t say it was about the seriousness of the offence. They said if the law has been broken, the law has been broken. I’m only holding them to their standards.”

“They spent five years pretending they were the most perfect people and now they had resignation after scandal after resignation, so let the ethics advisor investigate.”

Sir Keir Starmer has dismissed calls for an investigation into Chancellor Rachel Reeves after she apologised for breaking housing rules when renting out her family home.

In a letter to the prime minister, Reeves admitted she did not obtain a “selective” rental licence required to rent out her London home and “sincerely” apologised for her “inadvertent error”.

In reply, the prime minister said he was happy the “matter can be drawn to a close” after consulting his independent ethics adviser, who has decided not to launch an investigation.

The Conservatives have called for an investigation and for Reeves to be sacked.

The exchange of letters between the PM and Reeves revealed they had met on Wednesday evening to discuss the matter, which was first reported in the Daily Mail.

Reeves told Sir Keir that “regrettably” she was not aware a licence was needed to rent out her Southwark home after moving into Downing Street last year.

Reeves wrote: “This was an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the licence.

“I sincerely apologise for this error and I would be happy to answer any questions you may have.”

In his response, the prime minister said the public expected “the highest standards” and confirmed he had consulted with Sir Laurie Magnus, the ethics adviser whose findings have previously felled two ministers.

Sir Laurie had judged that further investigation was not necessary given Reeves’ swift action and apology, Sir Keir said.

Reeves’ family home in London was put up for rent after Labour won the election in July 2024 for £3,200 a month.

It is in an area where Southwark Council requires private landlords to hold a selective licence.

Selective licences ensure landlords meet set standards, normally aimed at raising housing quality, fighting crime and boosting housing demand.

Reeves’ allies admit she should have obtained a licence, but claim she was specifically told by the estate agents at the time that they would advise if she needed one.

The council’s website states: “You can be prosecuted or fined if you’re a landlord or managing agent for a property that needs a licence and do not get one.”

Reeves or her letting agent now face an unlimited fine if Southwark Council takes the matter to court.

The revelations come at a politically awkward time for Reeves, who is preparing for a Budget next month amidst speculation the government could break a manifesto commitment not to raise income tax.

Tory leader Kemi Badenoch earlier wrote on social media that Sir Keir “once said ‘lawmakers can’t be lawbreakers'”, adding: “If, as it appears, the chancellor has broken the law, then he will have to show he has the backbone to act.”

Shadow Chancellor Sir Mel Stride told BBC Breakfast on Thursday that he also believed the prime minister “needs to show some backbone”.

“We need a proper investigation into exactly what has happened,” he said. “This seems to be an attempt to put the whole thing to bed with a quick exchange of letters last night.

“This is a prime minister who, when he came into office, on the steps of Downing Street talked about restoring the dignity and integrity of government.

“We have seen a whole litany of these instances – Angela Rayner, Louise Haigh and others – who have fallen well short of that standard. If he is to stand by his word I think he should be concluding her position is untenable.”

The Liberal Democrats’ deputy leader Daisy Cooper said: “The chancellor is meant to be delivering growth but the only thing she appears to be growing is the government’s list of scandals.

“Just weeks before the Budget, this risks seriously undermining confidence in this government and its ability to focus on the urgent tasks at hand.”