Rachel Reeves has suffered her second big blow today, after a top gambling firm announced it has stopped taking bets on whether she’ll still be in her job by the end of the year. Coral bookmakers announced it has suspended betting on whether she’ll be ousted before 2026, as the firm believes it’s now a certainty.
The blow came hours after Keir Starmer appeared to undermine the Chancellor by poaching her second in command as part of a mini-reshuffle that saw the PM appoint a number of new economic advisers. Coral’s John Hill explained: “The writing may be on the wall for Rachel Reeves after the PM failed to publicly back her. We have pulled the plug on our betting on the Chancellor leaving her post by the end of the year.
“Betting is already available on Reeves’ replacement, with Pat McFadden the early favourite, ahead of Darren Jones and Torsten Bell respectively.”
The bookmaker’s odds on her replacement currently see Pat McFadden, the Cabinet Office minister, as the early favourite, with Mr Jones in second and tax-loving Treasury minister Torsten Bell in third.
Mr Jones’ new job will see him oversee day-to-day delivery of Sir Keir’s policy priorities, after privately calling on Ms Reeves to take a more radical approach.
The Chancellor is facing a nightmare Budget this August, with up to £40 billion in new tax rises on the way after successive U-turns from Ms Reeves on Winter Fuel cuts and welfare reforms.
Last week top economists also publicly warned that Ms Reeves is steering Britain towards a humiliating crisis that could see her forced to go cap-in-hand to the International Monetary Fund for a 1970s-style bailout.
Government borrowing costs have hit a 26-year high in recent weeks, as investors increasingly view the UK as a high risk investment.
Professor Jagjit Chadha, who recently ran the National Institute for Economic and Social Research, warned that the economy is now at risk of “collapse”.
He added that Ms Reeves’ financial situation is “as perilous the period leading up to the IMF loan of 1976”.
He was backed by Andrew Sentance, a former member of the Bank of England’s Monetary Policy Committee, who said the current situation is “very reminiscent of the 1970s”.
Rachel Reeves is on course to deliver a Healey 1976-style crisis in late 2025 or 26. Like Healey, she has massively boosted public spending, borrowing and taxes – fuelling both demand-pull and cost-push inflation. Unless policies are reversed, we are heading for an economic crash.
“We’ve still got bond yields that are even higher than the US. In fact, we’re even higher than Greece when it comes to borrowing costs, which is an indictment of where the UK is at the moment, or where it’s perceived to be by the financial markets.”
This morning Downing Street insisted that the mini-reshuffle did not suggest a schism opening up between the Prime Minister and his Chancellor.
A spokesman said: “The Prime Minister and the Chancellor have always worked in lockstep, and will continue to do so.”
