Sir Keir Starmer has dismissed calls for an investigation into his chancellor after she apologised for putting her family home up for rent without obtaining the necessary licence.

Rachel Reeves wrote to the prime minister to “sincerely” apologise for the “inadvertent error”, which was first reported by the Daily Mail.

Politics Hub: Latest updates from Westminster

The newspaper said the chancellor rented her family home in Dulwich when she moved into 11 Downing Street, but was unaware she had to obtain a “selective licence” to do so.

Please use Chrome browser for a more accessible video player


1:23

Could Labour break its manifesto in the budget?

Some London boroughs require private landlords to obtain a specific kind of licence if they are putting their property up for rent – including Southwark Council, where Ms Reeves’ home is listed.

The newspaper said she had now applied for a licence, but the Conservatives have called for an investigation.

A spokesperson for Ms Reeves said: “Since becoming chancellor, Rachel Reeves has rented out her family home through a lettings agency.

“She had not been made aware of the licensing requirement, but as soon as it was brought to her attention, she took immediate action and has applied for the licence.

“This was an inadvertent mistake and in the spirit of transparency, she has made the prime minister, the independent adviser on ministerial standards and the parliamentary commissioner for standards aware.”

What is a selective licence?

Southwark Council introduced “selective licences” across certain areas two years ago.

The scheme is designed to “improve safety, security and quality for people living in private rented homes”.

It aims to ensure renters who face persistent problems with damp, mould and outstanding repairs can get their issues resolved.

These licences apply to most private residential properties, last for five years, and cost £900.

Landlords need to provide documents including safety certificates for gas, electricity and fire alarms – along with floor plans and tenancy agreements.

Renting out a property without a licence can lead to civil penalties of up to £30,000 – as well as prosecution in some cases.

It is understood that Sir Laurie Magnus, the prime minister’s ethics adviser, has not launched an investigation into Ms Reeves.

Sir Keir said further investigation into the issue was “not necessary” after consulting Sir Laurie.

In a letter to Ms Reeves, he suggested her apology was a “sufficient resolution”.

Daisy Cooper, deputy leader of the Liberal Democrats, said the chancellor was adding to the government’s “list of scandals”.

“Just weeks before the budget, this risks seriously undermining confidence in this government and its ability to focus on the urgent tasks at hand,” she added.

Please use Chrome browser for a more accessible video player

Chancellor faces tough budget choices

The development comes weeks before Ms Reeves delivers her budget on 26 November.

She is rumoured to be considering a series of tax hikes, including a new tax on the sale of homes worth more than £500,000 to replace stamp duty.

Under the proposal, sellers, instead of buyers, would be responsible for paying the tax.

Read more:
What tax rises could Reeves announce?
Why is there a budget black hole?

The chancellor is understood to be looking at an annual 1% charge on the amount a property’s value exceeds £2m – and a £10,000-a-year levy for homes worth £3m.

Another proposal would see capital gains tax (CGT) charged when someone sells their main home, based on the amount it has increased in value during ownership.

Reports suggest this would only be applied to the most expensive properties, with a possible threshold of £1.5m, which would affect about 120,000 homeowners.