Rachel Reeves has admitted she did not get the right paperwork to rent out her family home, despite backing a similar scheme in her constituency.
The chancellor apologised after she failed to obtain a selective rental licence for her home in Dulwich, south London, which she put up for rent after she moved into No 11 following Labour’s election win.
Sir Keir Starmer is seeking to draw a line under the row after consulting his ethics adviser Sir Laurie Magnus, who decided against launching a probe.
But it has emerged that the chancellor publicly backed plans for a licensing scheme for rental properties in Leeds, saying it would improve conditions for renters.
Conservative chair Kevin Hollinrake reshared a tweet from the chancellor from earlier this month in which she supported the changes in the Armley part of the city.
“While many private landlords operate in the right way, we know that lots of private tenants in Armley face problems with poorly maintained housing,” she posted.
Southwark Council requires people renting out their properties in certain areas, including where Ms Reeves’s home is, to get one of the licences in advance.
The chancellor is understood to accept she should have obtained the licence, but relied on the advice of a letting agent and was not told it was necessary.
Southwark Council indicated on Thursday afternoon that enforcement is only likely if a person does not apply for a licence within 21 days of officials becoming aware of an unlicensed property, or the house is in a bad condition.
A spokesperson said: “When we become aware of an unlicensed property, we issue a warning letter advising the landlord that they have 21 days to apply for a licence – enforcement action such as fines are reserved for those who do not apply within that time or where a property is found to be in an unsafe condition.”
Meanwhile, Downing Street refused to say whether the chancellor broke the ministerial code over her failure to obtain the licence.
The prime minister’s spokesman also declined to get into what evidence was provided for adviser Sir Laurie to look into.
Facing questions about the extent to which the mistake had been probed by the prime minister and his ethics adviser, No 10 insisted that the ministerial code sets out that an apology is a “sufficient resolution” in certain cases.
“It was advised that in the light of the chancellor’s prompt action to rectify the position, including her apology, further investigation is not necessary,” the spokesman told reporters.
Tory leader Kemi Badenoch has called for the prime minister to conduct an audit of his whole cabinet to make sure no other errors have been made, after a number of high-profile government figures, including former deputy prime minister Angela Rayner, had to step down as a result of scandals.
I welcome Leeds City Council's decision to expand their selective landlord licencing policy to include the Armley area.
— Rachel Reeves for Leeds West and Pudsey (@RachelforLWP) October 20, 2025
While many private landlords operate in the right way, we know that lots of private tenants in Armley face problems with poorly maintained housing. (1/3)
Asked if Sir Keir should carry out an audit of his cabinet, Mrs Badenoch said: “I think he’s going to have to do more than a one-off audit. He does not have a cabinet of people who are ready to run the country. None of them have ever run a proper business. That’s why they’ve got themselves into a mess.”
She added: “They’re very, very distracted with all of their personal issues, their constant blunders. We need a Cabinet of people who are focused on what is going on with the economy.”
Meanwhile, a ministerial colleague has said the chancellor should not resign, after Ms Reeves apologised for her “inadvertent error”.
Asked on Times Radio on Thursday whether Ms Reeves should resign, Ms Jones said: “No, she shouldn’t.”
“She, after the election, of course, moved into 11 Downing Street, as chancellors do. She has a family home in Southwark that she rented out through a letting agency. Now, Southwark Council has what’s called a selective licensing scheme.
“Some boroughs have them, some don’t … The chancellor wasn’t aware that she had to apply for this selective licence. As soon as she became aware, she rectified the situation.”
A spokesperson for Ms Reeves said: “Since becoming chancellor, Rachel Reeves has rented out her family home through a lettings agency.
“She had not been made aware of the licensing requirement, but as soon as it was brought to her attention, she took immediate action and has applied for the licence.
“This was an inadvertent mistake and in the spirit of transparency, she has made the prime minister, the independent adviser on ministerial standards and the parliamentary commissioner for standards aware.”
In a letter to the prime minister, the chancellor wrote: “I wanted to make you aware of a matter which has been brought to my attention regarding my family home, which we are letting out to tenants via an external lettings agency.
“There are selective licensing requirements in this ward for renting out a property. Regrettably, we were not aware that a licence was necessary, and so we did not obtain the licence before letting the property out.
“This was an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the licence.”
