FTI Consulting UK Public Affairs Snapshot: The great reshuffle: Reset or overreach?

The government reshuffle – which had been discussed as far back as January of this year – finally kicked off at the end of last week, forced by the resignation of Angela Rayner. The Prime Minister, Keir Starmer, and his team decided that this was not an opportunity to be missed and set about implementing a significant rearrangement of responsibilities around the Cabinet table, as well as a widespread change of the guard in the lower ministerial ranks. 

This followed changes at the start of the week to operations in No 10 and No 11, with a significant promotion for Darren Jones to the heart of government strategy and operations. Starmer, and perhaps more accurately, his Chief of Staff, Morgan McSweeney, have taken a huge gamble with such bold moves. Either it successfully rocket-boosts the delivery across government that they are so desperate to see, or it creates unmanageable disharmony on the Labour benches. 

Headline changes  

The reshuffle winners include Shabana Mahmood, promoted from Justice to Home Secretary, taking on the thorny issues of small boats and asylum hotel protests. On day one in the job Mahmood signalled her intention to be even tougher than her predecessor, with an announcement that the UK may suspend visas for countries with whom no migrant return arrangement exists. 

There were promotions too for Steve Reed, stepping up from the Department for Environment, Food and Rural Affairs (Defra) to replace Rayner at the Ministry of Housing, Communities and Local Government (MHCLG), and Peter Kyle, who replaces the popular Jonathan Reynolds at the Department of Business and Trade (DBT). Emma Reynolds is rewarded for her work at HM Treasury and joins the Cabinet for the first time at Defra, and Douglas Alexander returns to the role of Secretary of State for Scotland, almost 20 years after he previously held it.  

Sweeping policy changes are not envisaged with this reshuffle, which is more about emboldening delivery across the government. Two additional Cabinet ministers are placed front and centre of this strategy. The promotion of Darren Jones initially to Chief Secretary to the Prime Minister and then to Chancellor of the Duchy of Lancaster at the Cabinet Office places him directly at the heart of translating the Prime Minister’s vision for government into delivery and action. 

Pat McFadden, previously a fixer-at-large, is tasked with fixing one of the government’s greatest problems in its first year: welfare reform. McFadden is understood to be determined to take another swing at reducing the welfare bill, and few who know the doughty Scotsman would doubt him.  

Ian Murray vacates the Scotland Office in a move that went down so badly with Scottish MPs and party members that he has been brought back as a minister, straddling roles at the Department for Science, Innovation and Technology (DSIT) and the Department for Culture, Media and Sport (DCMS). 

Lucy Powell loses out, vacating the position of Leader of the House of Commons to be replaced by a stalwart of the Labour Whips’ Office, Alan Campbell. Tensions had been growing, with No 10 and the Whips’ Office blaming each other over the welfare reform rebellion. The solution was found in the form of new Chief Whip Jonathan Reynolds, who may be as sad to leave his Business Secretary role as the somewhat disillusioned business community is to see him go, especially given how far they have fallen out of love with HM Treasury.    

Debate continues on whether both Yvette Cooper and David Lammy have been demoted, but neither can be too disappointed with their respective moves to the Foreign Office and the Justice Department, the latter sweetened with the additional title of Deputy Prime Minister. Labour insiders will see Lammy’s role change as possible preparation for a London mayoral candidacy, as Labour still desperately seeks the right candidate for the contest to follow Sadiq Khan’s term. Meanwhile, Liz Kendall survives her removal from the Department for Work and Pensions (DWP) to head up DSIT. 

The greatest speculation over the last few months was, of course, the future of the Chancellor of the Exchequer, Rachel Reeves. However, in reality, a change on this front was never seriously on the cards, with economic policy remaining, for now, a joint project between No 10 and No 11.  

Will Starmer’s changes work?  

The intent of this reshuffle is clear: to promote loyalists and MPs who Starmer believes can deliver. The make-up of the government has moved slightly to the right and is likely to be stronger and more united behind the view that taking the fight to Reform UK, rather than offering a left-wing alternative, is the right course to chart. This will be a hard sell among a tetchier backbench group, some entirely disgruntled at their own sackings, and others feeling they are taking the brunt of the government’s policies on the doorstep but with no reward.  

Starmer and McSweeney have once again shown their ruthless side by casting so many ministers aside and acting on No 10’s ambition to promote loyal talent, many of whom come from the 2024 intake of MPs. This is, in essence, the fruition of a strategy which dates back to Labour’s time in opposition, with McSweeney’s tight grip over parliamentary selections shaping the make-up of the Parliamentary Labour Party and talent pool. Starmer may now have the government he wants: loyal, disciplined and easier to control. 

However, in addition to a more difficult backbench group, creating so many brand-new ministers threatens to slow progress just as Labour is trying to convince the public that this is the “delivery” phase of the government they elected last year. For stakeholders who had just built positive working relationships over the last few months, these will have to be restarted in a number of cases with fresh-faced Ministers. 

Meanwhile, just over the horizon lies another potential complication: Labour’s competition for deputy leader, an independent position elected by party members. While this reshuffle is a decisive attempt to create a more harmonious government, it risks alienating other factions of the party– and this dynamic threatens to play out in the deputy leadership contest.  

Labour Party membership is, in the main, to the left of the government, and has a history – by intent or accident – of ensuring “balance” between the occupants of leader and deputy: think Blair/Prescott, Corbyn/Watson and, indeed, Starmer/Rayner. Therefore, there is no guarantee that the winner will reflect the leadership’s choice. In the worst case, it could be someone recently sacked in the reshuffle. With a hustings being organised for Labour Party Conference and a vote set for 23 October, it will also take up precious time and attention. From Starmer’s perspective, whoever wins needs to be a figure everyone can get behind, or risk deepening the very factional divides he worked so hard to unite. At the time of writing the declared candidates are Lucy Powell, Bell Ribeiro-Addy, Emily Thornberry and – No 10’s pick – Education Secretary Bridget Phillipson.   

Whether or not the “great reshuffle” was worth it will ultimately be determined by the Cabinet’s ability to deliver a clear direction on growth, immigration, welfare reform and the ability to transform the machinery of government into one that delivers the change Labour promised last year. The coming Labour conference will be the immediate test. If Starmer can frame the reshuffle as a bold reset aimed at delivering growth and competence, he will arrive with his authority intact. If, however, the narrative is dominated by talk of sackings and sidelined factions, internal party noise may drown out the intended message.