UK Chancellor Rachel Reeves has apologised for failing to obtain a licence to rent out her family home in South London, a lapse that has drawn criticism just weeks before she is set to deliver her first Budget on 26 November.
The issue, which surfaced after the Daily Mail approached her for comment, has prompted debate over ministerial accountability and housing compliance at the highest level of government.
Reeves, who became Chancellor following Labour’s victory in July 2024, admitted in a letter to Prime Minister Keir Starmer that she had rented out her Dulwich Wood property without the required permission from Southwark Council.
Reeves admits breach and apologises to Starmer
The Chancellor told Starmer in a letter sent late Wednesday that she “regrettably” did not realise a selective licence was necessary to let out the property. She wrote,
This was an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the licence. I sincerely apologise for this error and I would be happy to answer any questions you may have.
The Prime Minister, after consulting his independent adviser on ministerial standards, Sir Laurie Magnus, said no further investigation was needed given her prompt action and apology. Starmer wrote in a reply,
I am satisfied that this matter can be drawn to a close following your apology. It is regrettable that the appropriate licence was not sought sooner.
The exchange between the two, published on Wednesday, indicated they had also met in person that evening to discuss the issue.
Property rules and potential penalties
The Daily Mail first reported that Reeves had breached Southwark Council’s rules, which require landlords in selected areas to obtain a licence before renting out residential properties.
Her Dulwich Wood home, rented for £3,200 a month, falls within one such area.
Under the council’s housing regulations, selective licences ensure landlords meet minimum property standards to maintain safety and quality across private rentals.
Failure to obtain one can result in prosecution or an unlimited fine.
Reeves, who represents Leeds West and Pudsey in Parliament, could therefore face penalties if the council chooses to pursue legal action.
Ironically, Reeves has publicly supported the use of selective licensing schemes.
Less than two weeks ago, she praised Leeds City Council for expanding such measures, saying that landlords must meet certain standards to ensure homes are “safe and in a decent state of repair.”
Political pressure ahead of November Budget
The incident has come at a politically sensitive moment, with Reeves preparing to present a crucial Budget expected to outline plans to close a £40 billion funding gap.
While Starmer has accepted her apology, opposition parties have seized on the timing to question Labour’s commitment to integrity and transparency.
Conservative leader Kemi Badenoch said Starmer must act consistently with his earlier pledge that “lawmakers can’t be lawbreakers.”
Shadow Chancellor Sir Mel Stride echoed that sentiment, saying the government appeared to be “trying to put the whole thing to bed with a quick exchange of letters.”
Police Minister Sarah Jones, however, defended Reeves, stating she had “rectified the mistake, informed the Prime Minister, and apologised.”
Liberal Democrats Deputy Leader Daisy Cooper said the episode risked undermining confidence in the government’s ability to focus on economic priorities.
Fresh scrutiny after Angela Rayner’s tax controversy
The episode adds to a growing list of compliance issues within the Cabinet.
Only months earlier, Deputy Prime Minister Angela Rayner stepped down after failing to pay the correct taxes on a property purchase.
That controversy, combined with the current lapse by Reeves, has reignited opposition claims that Labour’s senior ministers have struggled to meet the same regulatory standards they promote.
Reeves’ prompt apology has, for now, spared her from formal investigation.
But with her debut Budget just weeks away and public attention fixed on her fiscal policies, the incident serves as an uncomfortable reminder of how administrative oversights can quickly become political liabilities.
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