Former Defence Secretary, John Healey, has been appointed as the new Chancellor of the Exchequer following the departure of Rachel Reeves, while Pat McFadden has kept his job as Work and Pensions Secretary.

In naming his cabinet, new Prime Minister, Andy Burnham, opted to remove Reeves from the role of Chancellor to replace her with Healey.

Healey is the MP for Rawmarsh and Conisbrough, and most recently served as Defence Secretary under Keir Starmer.

He quit as Defence Secretary in June due a disagreement over the government’s military spending plan, which he said fell short of what was required.

Healey was Parliamentary Private Secretary to then-Chancellor, Gordon Brown, between 1999 and 2001, after which he served as Adult Skills Minister, Treasury Minister, Local Government Minister, and Housing Minister.

In a post on X, Healey said his appointment as Chancellor was the "greatest privilege".

"Together, we will build a new economy, build new hope and advance the working people of this country," he continued. "Time to get on with the job."

In a post on her departure, Reeves said serving as Chancellor had been the “privilege of my life”.

“I wish the very best of luck to my successor, Andy and his cabinet," she added.

"You have my full support, and I will continue to play my part in helping this Labour government deliver the change the country needs.”

Meanwhile, McFadden has kept his job as Work and Pensions Secretary, a position he has held since September 2025.

He is the MP for Wolverhampton South East and his previous roles include Chancellor of the Duchy of Lancaster.

In a social media post, McFadden said: “I’m honoured to have been reappointed as Secretary of State for Work and Pensions.

“As the Prime Minister said, our mission as a government must be to support people into work and spread opportunity. That’s how we’ll reform the welfare system in a way that is fair and sustainable.”

This article originally appeared in our sister publication Wealth Investment News.

---