The heart of the new Government became a “lightning conductor for criticism” within months of the election, a Cabinet minister conceded, as he insisted a “strong team” has been appointed in a Number 10 reshuffle.
Defence Secretary John Healey said Sue Gray, who quit as chief of staff on Sunday after weeks of negative briefings against her, had played a “massive role” in preparing the party for power but had “become a distraction”.
Ms Gray stepped aside citing “intense commentary about my position”, after rows over her salary and freebies given to Cabinet ministers and MPs cast a shadow over Labour’s annual party conference.
Replacing her is Morgan McSweeney, who led the party’s election campaign and with whom she was reported to have clashed, while she will take on a new position as “envoy to the regions and nations”.
Critics have argued the new administration was failing to set out a clear vision for Government, with some saying the timing of the Budget at the end of October has allowed negative stories to fill a policy vacuum.
Facing broadcasters on Monday, Mr Healey rejected suggestions the Government had left it too long, saying “we saw with Liz Truss and Kwasi Kwarteng what happens when you try and rush a Budget” so “this needs to be done properly”.
He rejected the idea that the Government is already at “crisis point”, three months after winning an electoral landslide that some would have expected to have been followed by a longer political honeymoon period.
“No, I’d characterise this as a new Government getting on with the job,” he told LBC.
He refused to be drawn on whether Ms Gray’s new role as envoy to the regions and nations was salaried or whether she would be elevated to the House of Lords, saying: “None of those are decisions for me.”
Speaking to BBC Breakfast, he said: “She made a massive contribution to helping prepare Labour for Government, we owe her a great deal, but as she said herself yesterday, she’d become a distraction with the commentary that was removing the focus on the Government’s job of working for change, and that’s why she’s stepped aside.
“I’m really glad she’s going to carry on working with the Government, working with the Prime Minister.
“She’ll help lead our work in the regions but the important thing is we’ve got a strong team at Number 10, the Prime Minister’s got a strong team across Government and in Parliament, and we’re a Government determined and continuing to get on with the job.”
He added: “We’ve seen this before, haven’t we, where the centre of Government becomes the lightning conductor for wider criticism, but in the end people understand Government is hard. What they judge governments by is what they do and not what they say.”
It comes as Blair-era spin doctor Alastair Campbell told BBC Radio 4’s Today programme the timing of the Budget 16 weeks after the election “creates this sense of people not being quite sure what the Government is about”.
Meanwhile, John McTernan, who was Sir Tony Blair’s political secretary, told Times Radio that Labour was “delivering drift” and the Government had “completely lost a grip” on its media grid and operations.
The Tories accused the ruling party of allowing itself to descend into “chaos”, as leadership hopeful Robert Jenrick claimed the new administration was in “freefall”.
Shadow Commons leader Chris Philp told GB News: “(Sir Keir) can’t even run his own Number 10 Downing Street operation, let alone run the country. This has all fallen apart a lot faster than I was expecting.”
Mr Jenrick claimed that Ms Gray’s tenure was “one of the unhappiest in the long history of that building (Downing Street)” and called for an investigation into allegations that she had denied access to officials who wanted to give an intelligence briefing to the PM.
“Ms Gray should be blocked from taking up her new role until the propriety and ethics team at the Cabinet Office — a unit she once ran — have carried out a full investigation,” he said.
In her statement on Sunday, Ms Gray said her “first interest has always been public service” and described it as an “honour” to “play my part in the delivery of a Labour Government.”
“However, in recent weeks it has become clear to me that intense commentary around my position risked becoming a distraction to the Government’s vital work of change,” she said.
“It is for that reason I have chosen to stand aside and I look forward to continuing to support the Prime Minister in my new role.”
Sir Keir thanked her for “all the support she has given me, both in opposition and government, and her work to prepare us for government and get us started on our programme of change”.
Number 10 rejected suggestions the Prime Minister has a “woman problem” after Ms Gray, one of the most senior figures behind the scenes with decades of Whitehall experience, was replaced by a man.
“I wouldn’t accept that characterisation at all,” Sir Keir’s official spokesman said when asked by reporters on Monday.
Asked whether it could be inferred from Ms Gray’s departure that the right structures had not been in place in Downing Street, the spokesman said: “I think it’s right to reflect on the first weeks and months in office to ensure that you do have the right structures in place going forward to deliver change for the country.”
Foreign Secretary David Lammy defended the former senior civil servant, who before joining Labour oversaw the report into the so-called partygate scandal , as a “superb public servant”.
“I thank Sue Gray for all that she did as a superb public servant. I congratulate her as she heads into this new role,” he told reporters on Monday.
As part of the reshuffle, there are two new deputy chiefs of staff in Vidhya Alakeson, political director at Number 10, and Jill Cuthbertson, who has been director of government relations in Downing Street since their election win.
She had previously worked for former Labour leaders Gordon Brown and Ed Miliband.
Former journalist James Lyons will be in charge of a new strategic communications team, joining Downing Street from TikTok.
Nin Pandit, who previously ran the Downing Street policy unit, has been appointed principal private secretary to the Prime Minister, a senior civil service position.
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