David Lammy becomes new deputy PM — live

As a council leader, Reed “saw front and centre the impacts of homelessness on people living in temporary accommodation”, meaning he would share Rayner’s determination to end the housing crisis, the member of the housing committee told Times Radio.

Ben Habib, the former Reform deputy leader, warned he was not impressed with the party “impregnating” itself with “failed Conservative ministers”.

He accused Reform UK of “rapidly becoming Conservative Party mark two”.

As the party that thought it stood on the ticket off change, absorbing former Tory ministers was “not the answer”, he told Times Radio.

“If you go to the same people that’s infected and you fish, you’re going to get infected fish,” he added.

Sir Jacob Rees-Mogg does not think it is likely that Reform and the Conservatives will merge and dismissed rumours over the weekend that he would defect.

Despite being “very friendly with members of Reform”, including the recent Conservative defector, Nadine Dorries, he insisted that “I am a Tory”.

However, Rees-Mogg did not rule out a “coupon election” in the style of Conservatives and the Lloyd George Liberals in 1918 whereby Reform and the Tories would not “aggressively oppose each other in constituencies” to avoid splitting the vote.

Even Angela Rayner’s political opponent, the former Conservative minister Sir Jacob Rees-Mogg, sang her praises, saying that the former deputy prime minister was a “leader in waiting for Labour”.

With the preface that “Nigel won’t appreciate this,” he told Times Radio that Rayner and the Reform UK leader, Nigel Farage, were remarkably similar in style, saying they shared their talents for speaking to voters, energising their supporters, cutting through the noise and appearing “very to be very real people”.

He added: “Losing Angela is, I think, a big blow to the Labour Party, who are all such dullards in comparison to her.”

However, the tax lawyer Dan Neidle countered that “Rayner has been unforgiving about other politicians, some of whom have done nothing wrong.”

Highlighting Rayner’s skewering of Jeremy Hunt for seeming to avoid stamp duty “when he hadn’t”, Neidle argued that “it’s a bit unreasonable” to expect forgiveness for a similar mistake.

Downing Street has announced the full line-up of Sir Keir Starmer’s cabinet appointments, as the prime minister completed his reshuffle:

• David Lammy will be the justice secretary and deputy prime minister
• Yvette Cooper will be the foreign secretary
• Shabana Mahmood will be the home secretary
• Darren Jones will be chancellor of the Duchy of Lancaster, and retains his new role as chief secretary to the prime minister
• Steve Reed will be the housing secretary
• Peter Kyle will be the business secretary
• Liz Kendall will be the technology secretary
• Emma Reynolds will be the environment secretary
• Douglas Alexander will be the Scottish secretary
• Jonathan Reynolds will be the chief whip
• Sir Alan Campbell will be the leader of the Commons

The “respect for Angela remains undimmed” because she referred herself to the ethics commissioner as soon as she realised she had made a mistake, the Labour peer Baroness Thangam Debbonaire has told Times Radio.

She also praised the former deputy prime minister’s prompt resignation after her position became untenable.

However, Debbonaire’s “overriding” thought was that Rayner’s exit from high office was a “great loss to the Labour frontbench,” with her “great Labour story”.

Debbonaire said that Rayner’s political career was “looked up to” by “women of all political parties and none”.

There is “no way to sweeten this pill” as Angela Rayner’s resignation is a “huge blow” to the Party, the Labour peer Baroness Ayesha Hazarika has said.

She told Times Radio that just a week before the story broke “there was serious talk of Angela Rayner potentially becoming prime minister at some point” if “things continued to be wobbly”.

Within the party, Rayner, “often seen as a sort of love child of Rizzo from Grease and Barbara Castle”, the late Labour MP, and the only person within the party who could take on Farage, Hazarika said.

Pat McFadden has been handed a new “super-ministry” bringing together the Department of Work and Pensions and skills policy.

He is job is effectively to fix Britain’s labour market, which has been plagued by a huge rise in long-term sickness at the same time as skills shortages, which are holding back business. His success will go a long way to determining the success of Starmer’s drive for economic growth.

As one of Starmer’s close allies, McFadden will have to revive efforts at welfare reform after a chaotic retreat earlier this year on plans to cut disability benefits. Ministers know they must stem the rising cost of sickness benefits, but are now focusing on doing it by getting more people into work.

Steve Reed will take over Angela Rayner’s role as housing secretary.

Reed, who was the environment secretary, was previously a Lambeth council leader and turned around what was one of London’s worst-run boroughs. He also worked on community cohesion initiatives.

He held the housing brief in opposition.

Sir Keir Starmer is expected to confirm the appointment of David Lammy as deputy prime minister and justice minister.

Yvette Cooper is being moved from the Home Office to the Foreign Office to replace Lammy. Shabana Mahmood will move from the Ministry of Justice to the Home Office.

It means that Mahmood will become one of the most high-profile politicians in government, charged with tackling one of its biggest challenges: small boat crossings.

Who has left?

• Angela Rayner resigned as deputy prime minister and the housing secretary, as well as deputy leader of the Labour Party
• Lucy Powell was sacked as the leader of the Commons
• Ian Murray was sacked as the Scottish secretary

Who are the new ministers?

• David Lammy has been appointed the deputy prime minister and justice secretary
• Shabana Mahmood will leave the Ministry of Justice to become the home secretary
• Yvette Cooper will leave the Home Office to become the foreign secretary
• Pat McFadden, who was the chancellor of the Duchy of Lancaster, will become the work and pensions secretary and will include a skills brief
• Steve Reed will leave Defra to become the housing secretary

A deputy leadership election among senior cabinet ministers has the potential to be very messy and Sir Keir Starmer may be tempted to try and avoid this.

If he nominates a deputy, that would make it very difficult for anyone in government to run against them. A compressed process, potentially concluding by the end of conference, could avoid a divisive contest.

Labour’s ruling National Executive Council, dominated by Starmer loyalists, would go along with the leader’s wishes.

But the risk of what would undoubtedly be seen as a stitch-up by many is that it would give a clear run for a left-leaning candidate to run against Starmer’s pick. While Corbynites such as Richard Burgon are likely to run, they will struggle to attract 80 supporters.

A soft left candidate, however, will be far closer to the instincts of many Labour MPs than Starmer’s government. That could leave Starmer with another very tricky relationship to manage.

As he reshuffles the cabinet, Sir Keir Starmer has a tricky decision to make about the structure of an election for a deputy leader.

Labour’s rules say he can appoint a temporary incumbent but the party must hold an election for a new deputy, who must be an MP.

Candidates must be nominated by 80 MPs and either 5 per cent of constituency Labour parties, or three affiliated trade unions.

This is meant to happen by the party’s conference at the end of the month, which candidates must attend, to be followed by a vote of party members. Affiliated supporters, such as union members, will also be able to vote.

There is mounting speculation among Labour MPs and ministers that the home secretary will be moved on and replaced by Shabana Mahmood, the justice secretary.

There are some who claim she will be given another major role, such as foreign secretary. Others think she is out of the government completely.

Ian Murray has been sacked as Scottish secretary, saying he is “hugely disappointed” to be leaving government.

Murray, who for years was the only Labour MP in Scotland for four years after the party was wiped out by the SNP in 2015, argued he had played a “pivotal role” in winning back 36 more seats last year.

Starmer is understood to have had some concerns about Murray’s performance and one Labour MP suggested that it was better to make the change now before the Holyrood elections next year.

Politics “is at a dangerous crossroads”, Murray said, adding that voters were “impatient for change”. In a sign of Labour anxiety about the rise of Reform, he said that politicians should aim to bring “prosperity, hope and our communities together, rather than furthering division and despair”.

• Read in full: Ian Murray ‘hugely disappointed’ to leave government

Lucy Powell has said “the future of our democracy looks uncertain” after she was sacked from Sir Keir Starmer’s cabinet.

She said it had been an honour to serve as leader of the Commons but added: “This has not been an easy time for the government … nor in politics more generally, not least with the rise of abuse, misrepresentation, social-media echo chambers and the call for easy answers.

“As women in public life, we experience this all the more. The future of our democracy looks uncertain and parliament and representational politics has an important role to play.”

The reshuffle is about to begin. Lucy Powell, the leader of the Commons, and Ian Murray, the Scotland secretary, are both leaving office.

However, far bigger moves are expected. There is speculation around the future of Yvette Cooper, the home secretary, and Lisa Nandy, the culture secretary, but at this point no one is safe.

The only minister to have been given assurances that she is safe is Rachel Reeves, the chancellor.

Angela Rayner has become the tenth minister to resign under Sir Keir Starmer, a rate of one every 43 days.

Others to have resigned include Louise Haigh last November, Anneliese Dodds this February and most recently Rushanara Ali last month.

Starmer still has a long way to go to catch the 45 recorded under Boris Johnson.

Nigel Farage has said Reform UK will establish a department for preparing for government as he unveiled a host of pledges at the party conference in Birmingham.

Zia Yusuf, the Reform party official who served as chairman until June this year, will be in charge of formulating a policy platform for the next election.

Farage said he would soon be meeting the Albanian prime minister as part of plans to deport asylum seekers, which he said would take place “within two weeks of winning government”.

The Reform leader said the UK is in a “very bad place” and in a state of “cultural decline”, adding: “I get this in the street from people. People point at me and say, ‘You are the last chance we’ve got to get this country back on track’.”

Since her election as an MP in 2015, Angela Rayner has stood out both for her extraordinary backstory and her direct and uncompromising approach to politics. While many of her colleagues put on a front when they come to Westminster, Rayner is undeniably — for better and for worse — herself.

• Read in full: The meteoric rise and spectacular fall of Angela Rayner

Matthew Pennycook, a housing minister who is a contender to replace Angela Rayner as head of the department, paid tribute to his former boss.

“It has been both a pleasure and a privilege to work with Angela Rayner over the past two years,” he said. “She’s put her heart and soul into delivering for this Labour government and leaves a legacy to be proud of.”

Dame Emily Thornberry, whose name is being circulated as a potential deputy Labour leader, said Rayner “has delivered the biggest upgrade to workers’ rights in a generation and begun to build the homes we desperately need. She has made a real difference and improved the lives of millions of people. That is something to which we should all aspire.”

Ed Miliband, the energy secretary, said: “Angela Rayner is one of the great British political figures of our time. Generations will grow up with stronger rights at work and in new homes because of her vision and leadership. I know she will continue to stand at the front of the fight for social justice in this country.”

A string of senior Labour politicians have praised Angela Rayner’s record in office.

Wes Streeting, the health secretary, said on X: “Angela Rayner has achieved more in the last year than most politicians achieve in a lifetime — a trailblazer for working-class kids from backgrounds like ours. When those kids have a council house, when their mums and dads have better rights and pay, they’ll have her to thank.”

Darren Jones, the newly promoted chief secretary to the prime minister, said: “For our Labour movement, Angela is the embodiment of social mobility and an inspiration to those of us from working-class backgrounds.”

Steve Reed, the environment secretary, said: “Angela, you can be so proud of all you’ve achieved for our country and party. You knew from your own background what it’s like to struggle and you used that experience to fight for a better future for working families.”

Sir Keir Starmer is expected to use his reshuffle to appoint a new deputy prime minister.

Under Labour rules the prime minister cannot fill the now vacant post of deputy leader of the party. However, there is nothing to stop him from appointing a governmental deputy who will stand in for him at events like prime minister’s questions.

It would also put whoever is chosen in prime position to run for the deputy leadership of the party with the full backing of the Labour hierarchy.

Among the possible candidates for the role include the Cabinet Office minister Pat McFadden, who has already been dubbed the “real deputy prime minister” given his cross-cutting Whitehall role.

Wes Streeting, the health secretary, is another contender along with Shabana Mahmood, the justice secretary.

Labour is now in “crisis”, according to Nigel Farage, who believes Sir Keir Starmer’s government will not last the full five years.

In his speech to the Reform UK party conference, brought forward by three hours to respond to Angela Rayner’s resignation, he says: “This government is deep in crisis. Not only have they fallen into deep unpopularity within a year of winning the general election, but it’s become clear to all of us it is a cabinet of wholly unqualified people to run our country. They are not fit to govern.”

Rayner’s behaviour reeks of “entitlement”, he argues, adding that there is a “good chance” Labour will implode due to a split on the left, causing a general election in 2027. “We must be ready,” the Reform leader says.

Angela Rayner’s tax avoidance shows Labour’s standards are worse than the Conservatives, Nigel Farage has said.

The Reform UK leader said in his speech at the party conference in Birmingham: “You simply can’t get away from being the housing secretary and avoiding £40,000 worth of council tax.”

He added: “Despite all the promises that this would be a new kind of politics, it is as bad, if not worse, than the one that went before.”

Farage appears to have mis-spoken. Rayner resigned for underpaying stamp duty, not council tax. She was accused last year of underpaying council tax on the sale of a former home in 2015, but the police and HMRC said no action needed to be taken.

The Labour peer and Times Radio presenter Ayesha Hazarika said Rayner’s resignation was a “huge blow to the Labour Party”.

“There’s no way to sweeten this pill. This is very, very difficult for the government. It’s very difficult for Keir Starmer. The new Labour government has been struggling but it’s going to be really interesting in terms of what the ramifications are,” she said.

“She was often seen as a sort of love child of Rizzo from Grease and Barbara Castle. Many people actually felt she was the only person that could really take on Nigel Farage. So that wing of the party is going to be gutted. But there is another part of the party who are furious with her for putting not just herself, but the whole of the reputation of the party on the line.”

• Listen to Ayesha Hazarika on Times Radio today from 1-4pm

Nigel Farage, whose conference speech today looks set to be upstaged by Rayner’s resignation, will now speak three hours earlier than planned.

In a video on X, Farage said: “It was inevitable, wasn’t it? Really, you can’t be housing secretary and avoid £40,000 worth of stamp duty. It’s just as simple as that.

“So, in the last few minutes, Angela Rayner has gone, but not just as housing secretary. Now, more significantly, she’s gone as deputy leader of the Labour Party.

“That means there will be an internal election within the Labour Party and you’re going to see the hard left of Labour shouting very, very loudly. For the last few years, the story has been splits within the Conservative Party. Mark my words: within weeks, it’ll be splits within the Labour Party.”

Sir Laurie Magnus acknowledged that Angela Rayner did receive advice suggesting that she only needed to pay the lower rate of stamp duty on the property — but found against her because that advice was caveated.

The ministerial standards watchdog said that on the basis of the advice she received, Rayner believed that the lower rate of stamp duty would be applicable and “was twice informed in writing that this was the case”.

But he added that in those two instances, that advice was qualified by the acknowledgment that it “did not constitute expert tax advice and was accompanied by a suggestion, or in one case a recommendation, that specific tax advice be obtained”.

He added that if such expert tax advice had been received, as it later was, it would likely have advised her that a higher rate of stamp duty was payable.

Sir Keir Starmer will carry out a major cabinet reshuffle this afternoon in the wake of Angela Rayner’s resignation.

The prime minister is expected to sack or demote senior members of his cabinet as he seeks to “invigorate and refresh the team”. Only Rachel Reeves, the chancellor, has been told her job is safe.

Starmer was originally intending to carry out the reshuffle in the autumn but has brought it forward in an effort reset his premiership. He is said to believe that he needs a “new refreshed team to deliver on the country’s key priorities”.

Kemi Badenoch has said Rayner’s position was “untenable for days” after she admitted she underpaid stamp duty on her Hove flat.

In a video posted on X, Badenoch said: “Angela Rayner is finally gone. It says everything about Keir Starmer’s weak leadership that he had to wait for a report before acting.

“The truth is simple, she dodged tax. She lied about it. Her position was untenable for days.

“Keir Starmer once promised honesty and integrity in politics, but when faced with this test, he hesitated: no principles, no backbone.

“We Conservatives forced this investigation and were vindicated. But this isn’t the end. Questions remain. What did Keir Starmer know and when did he mislead the public?”

In his letter to Sir Keir Starmer, Sir Laurie Magnus was unambiguous in his belief that Angela Rayner had breached the ministerial code.

The independent ethics watchdog said that while he believed she had acted with “integrity”, that did not excuse her failure to pay the right amount of tax.

“Her unfortunate failure to settle her stamp duty liability at the correct level, coupled with the fact that this was established only following intensive public scrutiny, leads me to advise you that, in relation to this matter, she cannot be considered to have met the ‘highest possible standards of proper conduct’ as envisaged by the Code,” he wrote.

“Accordingly, it is with deep regret that I must advise you that in these circumstances, I consider the Code to have been breached.”

Sir Keir Starmer let Angela Rayner resign rather than sacking her, despite the finding that she had broken the ministerial code.

In a rare handwritten letter, the prime minister told Rayner he was “very sad to be losing you from the government”, saying he had “nothing but admiration for you and huge respect for your achievement in politics”.

Despite their past clashes, Starmer described Rayner as a “trusted colleague” and “true friend”, praising her work on housebuilding, renters’ rights reform and the employment rights bill which he said “will change the lives of millions of people”.

But he told Rayner she had been “right to refer yourself to the independent adviser on ministerial standards and right to act on his conclusions”.

Angela Rayner said the challenges of being in government were “nothing compared to the challenge of putting food on the table” as she reflected on her upbringing.

The former deputy prime minister said that rising from being “a teenage mum from a council estate in Stockport to serve as the highest level of government has been the honour of my life”.

She said: “The challenges of government are nothing compared to the challenge of putting food on the table and getting a roof over our head when I brought up kids working as a home help. Too many people face the same across our country.”

Rayner added: “Every day I had in office, I worked to serve working-class communities like the one that I grew up in, which are too often overlooked by those in power. I am proud that in every decision I made, I did it for them.”

Sir Laurie Magnus’s report found that Rayner had broken the ministerial code by failing to meet the “highest possible standards of proper conduct” in government.

The prime minister’s adviser on ministerial standards found that while Rayner had taken advice before paying the lower rate of stamp duty on her £800,000 Hove flat, she had ignored warnings from lawyers that she also needed to take expert tax advice.

Magnus said it was “highly unfortunate” that she had “failed to pay the correct rate of stamp duty, particularly given her status and responsibilities as the Secretary of State for Housing, Communities and Local Government and as Deputy Prime Minister”.

He told Sir Keir Starmer: “She believed that she relied on the legal advice she had received, but unfortunately did not heed the caution contained within it, which acknowledged that it did not constitute expert tax advice.”

Angela Rayner said she was resigning from the government both because of the finding of Sir Laurie Magnus’s report and for the sake of her family.

In her letter to Sir Keir Starmer, Rayner said she had to “consider the significant toll that the ongoing pressure of the media is taking on my family”.

She said: “While I rightly expect proper scrutiny on me and my life, my family did not choose to have their private lives interrogated and exposed so publicly.

“I have been clear throughout this process that my priority has, and always will be, protecting my children and the strain I am putting them under through staying in post has become unbearable.”

The ethics watchdog Sir Laurie Magnus said Angela Rayner had “acted with integrity and with a dedicated and exemplary commitment to public service” but concluded she breached the ministerial code over her tax affairs.

Angela Rayner has said she “deeply regrets” her decision not to seek specialist tax advice as she thanked Sir Keir Starmer for his support.

In her resignation letter, the former deputy prime minister said she took “full responsibility for this error” and said it was “never my intention” to not pay the correct amount.

She said she decided to resign from her three positions “given the findings” of the investigation by Sir Laurie Magnus.

She praised the achievements of the Labour government so far and vowed to continue to serve and support Starmer in the years ahead.

Despite her resignation Angela Rayner remains a powerful figure in the party who may be a focal point for rebellions, writes Steven Swinford.

• She had to go but Starmer’s Rayner problem is far from over

Angela Rayner has resigned as deputy prime minister, deputy leader of the Labour party and housing secretary following the investigation into her tax affairs.

The MP for Ashton-under-Lyne has been under investigation by Sir Laurie Magnus, the independent adviser of ministerial, since it emerged she had underpaid stamp duty when purchasing her property in Hove.

It will trigger a cabinet reshuffle and an election within the party. The Labour party conference takes place at the end of the month, which could see a new deputy leader elected.

Angela Rayner has quit government after a sleaze investigation by the prime minister’s adviser on ministerial standards.

The deputy prime minister and housing secretary resigned over her failure to pay £40,000 in stamp duty on her second home.

Her departure will trigger a cabinet reshuffle and an election for Labour’s deputy leadership. Rayner had claimed she paid the correct rate of stamp duty on the property in Hove following legal advice.

But she referred herself to Sir Laurie Magnus after a senior barrister found she should have paid a £40,000 surcharge on the property.

Magnus handed over his report to Sir Keir Starmer this morning who concluded that Rayner’s position was untenable, triggering her resignation. A reshuffle to fill Rayner’s job as housing secretary is also expected today.

• Who will replace Angela Rayner? The likely candidates

Angela Rayner is expected to leave government after a sleaze investigation by the prime minister’s adviser on ministerial standards.

Two senior government sources said that the deputy prime minister is expected to leave over her failure to pay £40,000 in stamp duty on her second home. An announcement is due shortly.

Her departure will trigger a cabinet reshuffle and almost certainly an election for Labour’s deputy leadership. Rayner had claimed she paid the correct rate of stamp duty on the property in Hove following legal advice.

But she referred herself to Sir Laurie Magnus after a senior barrister found she should have paid a £40,000 surcharge on the property.

Magnus handed over his report to Sir Keir Starmer this morning who concluded that Rayner’s position was untenable.

Sir Laurie Magnus must examine if Angela Rayner sold her constituency property in January this year “because she knew taxes were about to go up” in the budget, the Conservatives have said.

Kemi Badenoch said the independent adviser on ministerial standards needs to examine what Rayner’s department said to the Treasury, to avoid “accusations of a whitewash”.

“We already know that Angela Rayner was lobbying to increase stamp duty in the upcoming budget. What we don’t know is what other discussions she was having with the Treasury about hiking taxes on the family home,” the Tory leader said.

“To avoid any accusations of a whitewash, the ethics adviser must examine all the material that Rayner’s housing department sent the Treasury about any proposed property taxes.”

Kemi Badenoch has weighed in this morning, suggesting that the government is being distracted by “yet another scandal”.

The Conservative leader was reacting to a Times report showing companies were cutting jobs at the fastest rate for four years in the wake of payroll tax increases.

My usual attitude to a political scandal is all-in schadenfreude, writes Times columnist Sarah Ditum. But in this case I’ve found the feeding frenzy around Angela Rayner difficult to watch and felt deeply conflicted about her treatment.

• Read in full: Whisper it, I feel sorry for Angela Rayner

Away from Westminster and questions over Angela Rayner’s tax affairs, the Reform UK party conference is beginning in Birmingham.

Nigel Farage will tell delegates he is ready for a general election as early as 2027. He predicts the Tories will collapse as a national force, while Jeremy Corbyn’s new party and the state of the public finances will help sink Labour.

The Reform leader also believes that further high-profile defections in the wake of the decision by Nadine Dorries, a former Tory cabinet minister, to join his party will help to broaden Reform’s appeal further.

• Nigel Farage: I’ll be prime minister by 2027

Whatever Angela Rayner’s fate, there is confusion about who really wields power behind the throne — and Sir Keir Starmer’s Downing Street reshuffle this week has not made things any clearer, Patrick Maguire writes.

• Read in full: Who is Keir Starmer’s No 2 — even if Angela Rayner stays?

As ministers went out to defend Angela Rayner, Sir Keir Starmer was kept in the loop about his deputy’s stamp duty advice and how the situation had changed. His endorsement of her never wavered, but what happens next is ultimately out of his control.

• Read in full: Who knew what — and when — about Angela Rayner’s tax affairs?

The prime minister said in parliament on Wednesday that his deputy was the victim of a smear campaign because she is a working-class woman. It’s an argument even she did not make and he’s wrong, argues Fraser Nelson — this is about fairness and accountability.

• Read in full: Angela Rayner tax row is not about class war

Since her tearful interview with Sky News on Wednesday in which she admitted she did not pay enough tax when purchasing her apartment on the south coast, Angela Rayner has been almost silent.

But the work of the deputy prime minister and the secretary of state for housing, communities and local government has gone on.

On Thursday Rayner shared a picture on her social media account of her with all the metro mayors across the country.

They met as Sir Laurie Magnus, the independent adviser on ministerial standards, continued his investigation to determine if she breached conduct rules.

The constituency home of Angela Rayner was valued at almost double the price of other recently sold homes on the same street when she sold her stake, it has been revealed.

The deputy prime minister sold a 25 per cent share of her four-bedroom detached home in Ashton-under-Lyne for £162,500. This was said to be based on a total valuation of £650,000 taken in 2022 when Rayner and her husband divorced.

However, an analysis of property data by The Daily Telegraph showed that no house within a mile of the house has sold for more than £561,000. A three-bedroom semi-detached property sold for £365,000 in 2021.

The newspaper also used an online portal to estimate the price of the house, which placed it at £565,000.

We know the deputy prime minister failed to pay £40,000 of “higher rate” stamp duty when she bought her Hove flat. But did she avoid tax? Evade tax? Or something else? A tax expert explains the possible scenarios.

• Dan Neidle: Did Angela Rayner avoid or evade tax — or make a simple mistake?

Government sources were gloomy about Angela Rayner’s future this morning.

One senior source told The Times things were “looking bad” for the deputy prime minister, while another said their mind had changed overnight on whether she would survive.

Douglas Alexander, the trade minister, was unable to guarantee on LBC that Rayner would still be in post by Labour’s party conference this month.

He said: “On a personal level, of course I hope so. But as you know and as all your listeners know there’s a process now under way.

“Angela Rayner made a mistake, she admitted as much on the basis of the additional advice that she received.

“What is important to understand, honestly, is not that these issues don’t arise, but how does the government deal with them?”

The trade minister Douglas Alexander has said Angela Rayner is in politics “for the right reasons”.

Asked whether he trusted the deputy prime minister, he said: “Listen, I really want to live in a country in which someone with Angela Rayner’s circumstances and background can rise to one of the highest offices in the country.

“I have to say I should declare an interest — I really like Angela Rayner. We’re a rather improbable group of friends. We come from very different circumstances … if you look at the challenges that Angela Rayner has overcome, not only do I like and respect her but, yes, I think she’s in politics for the right reasons.”

If the deputy prime minister and housing secretary resigns, she leaves two openings in powerful roles.

She would still be a powerful force on the Labour back benches and would remain as the party’s elected deputy leader, unless she resigned or members voted for a contest.

Wes Streeting and Shabana Mahmood would be among those in line to replace her.

• Read in full: Who could replace Angela Rayner? The likely candidates

A trade minister has said that Angela Rayner made a “mistake” but would not be drawn on whether she should resign if she is found to have breached ministerial conduct rules.

Douglas Alexander told Times Radio that questions over the deputy prime minister’s conduct were for Sir Laurie Magnus, the independent adviser on ministerial standards.

“We have a process and truthfully the test for government is not whether issues like this arise in the course of a parliament. The question is, what is it that they always do? It’s how these issues are dealt with.”

• How long can Angela Rayner last? Judgment day looms for deputy PM

Alexander said he did not know when the report will be published, with speculation it could be as soon as today. “Sir Laurie Magnus will be bringing forward his report to the prime minister in due course.

“The expectation is he works in a very comprehensive but also a pretty expeditious way. Then it will come to the prime minister and it will be for the prime minister, as always, to make judgments in relation to his ministers.”

Angela Rayner’s political future is in the balance as the prime minister has indicated that he is prepared to sack her if she has breached ministerial sleaze rules, as a report into her conduct is expected to be delivered as early as today.

On Thursday Rayner’s own lawyers said they had not given her any tax advice and were being made “scapegoats”, appearing to contradict claims from Rayner that she had been following advice.