Shabana Mahmood is understood to be among the leading contenders to become chancellor in Andy Burnham’s new cabinet, with John Healey emerging as a potential successor at the Home Office.
Mahmood, the current home secretary, is thought to be well regarded by figures in the prime minister-in-waiting’s camp as speculation builds over who Burnham would appoint to the Treasury.
A move to No 11 would create one of the most significant vacancies in government. Speaking on the latest episode of In The Room, The Independent’s political podcast, former deputy cabinet secretary Helen MacNamara said Westminster sources had suggested Healey, who resigned as defence secretary under Starmer less than a month ago, was among the names being discussed for home secretary.
Those conversations appear to have hardened in recent days. The Independent understands that Mahmood’s name has gained traction in discussions about the Treasury, while Healey is now being spoken of in Westminster as a frontrunner to take over at the Home Office if she is moved.
“So it’s interesting that they seem to have very, very firmly rolled the pitch for Rachel Reeves going. And that’s happened in the last few days. She has sort of indicated that that’s what she’s expecting too.
“I think there were some thoughts a couple of weeks ago that maybe she would stay, but that doesn’t look likely anymore. So I would bet on Shabana Mahmood.”
“I wouldn’t actually think it’s a good idea to move Shabana, because she’s doing an amazing job,” MacNamara said. “But she’d be great as chancellor. She’s clever, well-regarded, and tough enough.
“The actual job of chancellor is to project massive amounts of confidence. They have to make some really difficult decisions, and they’re going to have to carry some of the things that Andy Burnham has already signalled he’s going to do.”
Burnham’s economic plan for the UK, set out in a speech on 29 June, included a focus on reducing welfare spending. MacNamara suggested that could strengthen the case for work and pensions secretary Pat McFadden, another candidate tipped for the role.
“If you’re Burnham, and you know that welfare needs this really big transformation, you might want to keep Pat McFadden in that role. He’s a widely respected, tough, old Labour/new Labour guy.”
Healey, meanwhile, is “a man everyone likes,” MacNamara said. The former defence secretary quit on 11 June after accusing Starmer of failing to defend the country at a time of “rising threats”.
In his resignation letter, Healey said the prime minister had been “unable, and the Treasury has been unwilling, to commit the resources that the nation needs to defend the country at this time of rising threats”.
The shock exit was seen by many as the final straw for an already weakened Starmer, who resigned as prime minister 11 days later.
MacNamara said: “Healey quitting essentially got the ball rolling for Keir Starmer going. And if you did have Shabana Mahmood as chancellor, you have a problem in the Home Office, which is a hell of a department. You would need somebody really tough.”
Cleo Watson, MacNamara’s fellow In The Room co-host and a former No 10 special adviser, also said she had heard rumours that David Miliband would be open to a return to Labour as foreign secretary.
Watson speculated that Miliband could be made a Lord in order to serve in the role, in the same way David Cameron was brought back into government by Rishi Sunak. “It could be a move from Burnham of, ‘He’s an old mucker of mine, I just want to give him this brief, and I can crack on,’” she said.
When questioned during a panel for the Institute for Government about what his response to an offer from Burnham might be, Miliband said: “Let him make his choices. We should give him the space to form his government.”
MacNamara said the rumour was “really heartening… it looks like Andy Burnham is drawing on the actual storied, star ranks that the Labour Party has at its disposal. One of the things I found really weird about the Starmer government was that they had a really good team of people, and they just didn’t really use them.”
Listen to the newest episode of In The Room on Apple Podcasts, Spotify, or watch on YouTube.