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 helping the party 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 waited 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.”
Asked whether her new position was paid, Mr Healey said: “She has this great talent, Sue Gray, to bring people together, she’s a natural team player and she raises the standards of those around her.”
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.”
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 former prime minister 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: “What this shows us is that Keir Starmer’s government has collapsed into chaos after just 93 days.
“He 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.”
In her statement on Sunday, Ms Gray said: “It has been an honour to take on the role of chief of staff, and to play my part in the delivery of a Labour Government.
“Throughout my career, my first interest has always been public service.
“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.
“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 Ms Gray 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”.
As part of the reshuffle there are two new deputy chiefs of staff in Vidhya Alakeson, political director at Number 10, and Jill Cuthbertson, 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.