Former Defence Secretary John Healey has been appointed as the UK’s new “Chancellor of the Exchequer” or finance minister.
The surprise appointment comes as part of a major Cabinet reshuffle under Prime Minister Andy Burnham, who succeeded Keir Starmer.
Widely liked by colleagues, the 66 years old Healey will now have to find more money to spend on defence while also investing in other key areas such as health and welfare.
He replaces Rachel Reeves as Chancellor. Reeves departed the Cabinet after declining an alternative post offered by Burnham.
Though best known recently for his defense portfolio, Healey is not new to the Treasury. He previously held junior Treasury positions including Financial Secretary and Economic Secretary under Tony Blair and Gordon Brown between 2002 and 2007.
John Healey previously served as Secretary of State for Defence under Keir Starmer from July 2024 until June 2026, when he resigned over disputes regarding military funding levels.
Healey is viewed by Westminster insiders as a steady, experienced pair of hands to manage the UK’s finances.
People familiar with the decision said that Healey and Burnham had similar outlooks on the need to maintain economic stability and the need to drive growth by devolving power across the country, helping people with the cost of living, and building up Britain’s industrial base.
As defence minister, Healey spent months lobbying Starmer and the finance ministry to lay out a pathway to spend 3% of GDP on defence by 2030, rather than the 2.68% that the government eventually had budgeted for.
The unexpected resignation by Healey, who was a loyal ally of Starmer and one of the government’s most experienced ministers, was a significant blow to the then prime minister, who announced his resignation less than two weeks later.
Healey said Starmer had been “unable” and the Treasury “unwilling” to find the money to keep the country safe
The posting surprised political observers and markets, where Home Secretary Shabana Mahmood had been widely expected to take the Treasury brief.
