UK's Starmer stands by his Treasury chief after house rental rule breach

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LONDON (AP) — U.K. Treasury chief Rachel Reeves has apologized for breaking the law by renting out her London house without a license.

Prime Minister Keir Starmer said he would not take action over what Reeves called an inadvertent mistake.

Reeves and her family moved out of their south London home and into a government-owned apartment next to the prime minister’s Downing Street residence after the Labour Party was elected in July 2024.

The Daily Mail newspaper reported late Wednesday that Reeves did not have a rental license, as required by the local authority in the area. Landlords who don’t have a license can be prosecuted or fined.

In a letter to Starmer, published by the prime minister’s office, Reeves said it was “an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the license.”

Starmer replied that he had consulted the government’s ethics adviser, who had concluded that “further investigation is not necessary.”

“I am satisfied that this matter can be drawn to a close following your apology,” he wrote.

The real estate agency Reeves used apologized Thursday for its “oversight” in not applying for a license after promising to do so.

“We deeply regret the issue caused to our clients as they would have been under the impression that a license had been applied for," said Gareth Martin, owner of the firm Harvey Wheeler.

The statement came after Conservative Party leader Kemi Badenoch said “the whole thing stinks,” and demanded Starmer launch a full investigation.

Reeves is already under pressure over the public finances as she prepares to deliver her annual budget statement on Nov. 26.

The Labour Party government has struggled to deliver the economic growth it promised. Inflation remains stubbornly high and the economic outlook subdued, frustrating efforts to repair tattered public services and ease the cost of living.

Reeves has indicated she may abandon a preelection promise not to raise income tax or sales tax, arguing that the economy is in a worse state than previously thought after 14 years of Conservative government.

Starmer has already lost members of his government to scandal.

In September, Deputy Prime Minister Angela Rayner resigned after failing to pay enough tax on a home purchase. Days later, Starmer fired Britain’s high-profile ambassador to Washington, Peter Mandelson, over his links to the convicted sex offender Jeffrey Epstein.