Sir Keir Starmer has suggested he is ready to sack Angela Rayner if an ethics probe finds against her over underpaid property tax – but is facing warnings of a Labour civil war if the Deputy Prime Minister has to go.
The Prime Minister on Thursday accepted that “it does fall to me” to make a decision on Rayner’s future once his standards adviser reports back on whether she broke the ministerial code after she did not pay enough stamp duty on a flat in Hove.
Starmer is believed to be highly reluctant to remove Rayner, who is also Housing Secretary, as he attempts to reset his ailing Government ahead of the Labour Party Conference this month and a make-or-break Budget in November.
He is also facing warnings from Labour insiders that removing Rayner could trigger a party deputy leadership election that would become a “de facto referendum on Starmer’s leadership” at a time when the party is losing ground to Reform in the polls.
One Labour insider said the ethics probe would be a “sliding doors moment” that could trigger a Cabinet reshuffle, which Starmer had been resisting, with some MPs suggesting Cabinet Office fixer Pat McFadden was Rayner’s likeliest replacement as deputy prime minister.
Judgment day for Rayner could come as soon as Friday, with Sir Laurie Magnus, the PM’s independent adviser on ministerial interests, potentially being able to report back as soon as the afternoon. It comes after Starmer said he wanted to see an outcome “pretty quickly”.
Speaking to the BBC, the Prime Minister went on: “I do want it to be comprehensive… and then of course I will act on whatever the report is that’s put in front of me.”
He added: “Of course it does fall to me, I completely accept that, to make a decision based on what I see in that report.”
Caption: Workers prepare to paint over the Graffiti daubed outside the apartment building in Hove, East Sussex, where Deputy Prime Minister Angela Rayner owns a second home. Gareth Fuller/PA WireThe Prime Minister however repeatedly refused to confirm that Rayner would have to go if she was found to have broken the ministerial code.
Former prime minister Boris Johnson refused to sack Priti Patel in 2020 despite his standards chief finding the then home secretary had broken the ministerial code over bullying allegations.
But Starmer insisted “this is a million miles away from where we were under Boris Johnson” while pointing out he had “strengthened the procedure” for standards inquiries.
Outcome hinges on Rayner’s honesty
The outcome of Magnus’s report is likely to rest on whether Rayner was honest in saying she was acting on legal advice when she made the “mistake” of paying the standard rate of stamp duty on a property purchase in Hove rather than the higher rate reserved for second homes, saving £40,000.
Sources close to Rayner said she was given three separate pieces of legal advice before buying the £800,000 flat in East Sussex, having put her stake in her constituency home in Ashton-under-Lyne into a court-instructed trust following a settlement with the NHS over a “deeply personal and distressing incident” involving her son.
He was left with life-long disabilities and to ensure he continued to have stability in the family home in Greater Manchester, she said her family had agreed its interest in that property would be transferred to the trust.
The sources said Rayner had sought advice from a conveyancer and two experts in trust law before buying the Hove property and they had all suggested the amount of stamp duty she paid on the property was correct and she acted on the advice she was given at the time.
Joanna Verrico, managing director of the high-street conveyancing firm Verrico & Associates which acted for Rayner claimed her company was being made “scapegoats” saying it never gives advice on tax or trusts as it is not qualified.
She told the Telegraph: “The stamp duty for the Hove flat was calculated using HMRC’s own online calculator based on the figures and the information provided by Ms Rayner.
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“That’s what we used and it told us we had to pay £30,000 based on the information provided to us. We believe that we did everything correctly and in good faith. Everything was exactly as it should be.”
It came as Starmer and Science Secretary Peter Kyle, the MP for Hove, condemned graffiti that was found on Rayner’s seaside flat on Thursday. The words “bitch” and “tax evader” were pictured sprayed on the outside of her home.
No 10 said targeting of politicians’ homes is “appalling” and Kyle said “Hove is better than this” while Ms Rayner’s spokesperson called the vandalism “beyond the pale” and said it is a matter for the police.
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