Cabinet ministers have rallied around Angela Rayner as she fights for her political survival after admitting she underpaid stamp duty on a property purchase this year.
Chancellor Rachel Reeves gave the Deputy Prime Minister her “full confidence” to remain in post while Education Secretary Bridget Phillipson said she had “sought to be transparent” in the scandal over her tax affairs.
It comes as sources close to Ms Rayner, who is also the Housing Secretary, said she was given three separate pieces of legal advice before buying an £800,000 flat in Hove at the centre of the row.
They said a conveyancer and two experts in trust law 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.
Ms Rayner has been under mounting pressure in recent weeks after reports emerged she had saved £40,000 in stamp duty on her East Sussex flat by not paying the higher rate reserved for additional home purchases.
On Wednesday she admitted she had made a “mistake” and referred herself to standards adviser Sir Laurie Magnus after receiving fresh legal advice that she was liable for the extra duty following headlines about the purchase.
Speaking to broadcasters on Thursday, Ms Reeves said: “I have full confidence in Angela Rayner. She’s a good friend and a colleague she has accepted the right stamp duty wasn’t paid.
“That was an error, that was a mistake. She is working hard now to rectify that, in contact with HMRC to make sure that the correct tax is paid.”
She said the “definitive advice” on the Deputy Prime Minister’s stamp duty arrangements came in on Wednesday morning.
The Chancellor declined to say whether she thought stamp duty was too complicated, saying it was “incumbent on all of us to try to properly understand the rules”.
Ms Phillipson said initial follow-up advice “came back on Monday” and that Ms Rayner then applied to have a court order lifted which prevented her speaking about the arrangements.
“She has acted in good faith, sought to act appropriately with the information available to her,” she told Times Radio.
Ms Phillipson said the case was different from sleaze rows under the previous Tory government, of which Ms Rayner was a outspoken critic, adding: “What we saw in some of those cases in the past was a lack of scrutiny and a lack of transparency.
“The Deputy Prime Minister has sought to be transparent, has set out in some detail, which has been difficult given that it relates to her family, extensive information.”
But she declined to guarantee Ms Rayner’s political future, insisting the investigation should “run its course.”
Asked if her colleague would still be Deputy Prime Minister by Christmas, she told LBC: “I’m not going to get into hypotheticals or speculate. I’m sorry to disappoint you. I’m just not going to do it. That process will run its course.”
Lucy Powell, the Leader of the House of Commons, told MPs the Conservatives were attacking Ms Rayner “because she is so bloody good at her job”.
Speaking at business questions, she added: “Suffice to say, the Deputy Prime Minister is a huge, huge asset to this Government. She’s an incredibly effective minister and she has been delivering.”
Details about the complex property arrangements have continued to emerge since Ms Rayner’s statement on Wednesday, when she had said that a court-instructed trust was established in 2020 following a “deeply personal and distressing incident” involving her son as a premature baby.
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 that its interest in that property would be transferred to the trust.
She said she had put her stake in the constituency home in Ashton-under-Lyne into this trust, which a “leading tax counsel” had later told her made her liable to pay the additional stamp duty on her new Hove flat.
On Thursday, the Daily Telegraph newspaper reported that she sold her remaining stake to the trust for £160,000.
Tax experts said the new property could not be treated as her only residence because of the nature of the trust.
The Conservatives have written to HMRC calling for it to launch its own investigation on whether she tried to evade tax, with party chairman Kevin Hollinrake saying her explanation “cannot withstand scrutiny”.
Sir Keir Starmer stood by his deputy at Prime Minister’s Questions, saying he was “very proud to sit alongside her” amid calls from Opposition critics for her to resign over the row.
Ms Rayner has said she is “working with expert lawyers and with HMRC to resolve the matter and pay what is due”.
Losing the Deputy Prime Minister would cause a headache for Sir Keir. She is key to his political project, overseeing the manifesto pledge to build 1.5 million new homes as well as Labour’s flagship workers’ rights expansion.
Widely seen a bridge between the No 10 operation and the wider party, she is popular among the grassroots and said to have played an important role in defusing the backbench revolt over proposed welfare cuts earlier this year.
Some Labour MPs have expressed hope that she will be able to remain in post, with one saying she was “doing a good job and everyone recognises she brings a perspective we need to the top team”.
Left-leaning Norwich South MP Clive Lewis, who has previously criticised the Government over policies like the backing of the Heathrow Airport expansion, said he did not think Ms Rayner should be considering quitting.
He told the PA news agency: “I know Angela well enough to say with confidence that she is scrupulous when it comes to following the rules.
“If an error has been made on her taxes, I believe it was just that – an error – not an attempt to avoid paying what she owes.”
He said there were “legal constraints” on how much she can disclose and that she has already done the “responsible thing” in referring herself to the ethics adviser, adding: “For those reasons, I don’t believe she should be considering her position.
“We are all fallible and what matters is how we act when mistakes occur. I have every confidence she will rectify this fully and transparently.”
