Politics latest: Senior Tory steps back in shadow cabinet reshuffle but Jenrick could miss out

Archie Mitchell, political correspondent, reports here:

The Governor of the Bank of England has said it “would not be sensible” for the Government to scrap the bank ring-fencing regime, after Rachel Reeves announced plans to reform the system last week.

Andrew Bailey also stressed that the UK cannot “compromise” on financial stability amid the Treasury’s plans to rip up red tape across the sector.

“I do think the ring-fencing regime is an important part of the structure of the banking system,” he told MPs on the Treasury Committee.

“It makes the resolution of banks if they’re in trouble much easier, and it benefits, particularly in terms of the UK, consumers, business and households.

“I’m sure there are things that can be improved and we will work constructively to get through that process.”

“I think it has established itself as part of the system and to me it would not be sensible to take it away at this point,” he clarified.

The ring-fencing regime was brought in after the 2008 financial crisis to separate banks’ retail and investment banking activities.

In a letter to the party leader dated July 9 and shared by Mrs Badenoch on X on Tuesday, Mr Argar said: “I had a health scare earlier this summer and remain grateful to the doctors and hospital staff who looked after me.”

He added: “I have been well looked after, but have also listened to what the doctors said to me, and have listened to my family, and have concluded that lightening my front-bench workload over the coming months, in order to complete my recovery and fully restore my health in that period is the sensible approach.”

Mrs Badenoch said in her X post that Mr Argar is preparing “for his last parliamentary oral questions from the front bench”, and in her response letter to him dated on Tuesday, said she was “very sorry” that he was leaving the shadow cabinet.

“Though I am saddened that you feel unable to continue in the shadow cabinet, I strongly agree that you must put your health first,” she said in her letter.

The governor of the Bank of England has warned MPs that “greater uncertainty” in global trade policy is pushing up the cost of borrowing in bond markets.

Andrew Bailey said he was “not unconcerned” as he gave evidence to MPs on the Commons Treasury Committee.

It follows Donald Trump’s decision to slap tariffs on goods from other countries entering the US – prompting a trade war.

Chancellor Rachel Reeves has said a review into raising the state pension age is needed to ensure the system is “sustainable and affordable”.

The Government review is due to report in March 2029 and Ms Reeves said it was “right” to look at the age at which people can receive the state pension as life expectancy increases.

The state pension age is currently 66, rising to 67 by 2028 and the Government is legally required to periodically review the age.

The Chancellor told reporters: “We have just commissioned a review of pensions adequacy, so whether people are saving enough for retirement, and also the state pension age.

“As life expectancy increases it is right to look at the state pension age to ensure that the state pension is sustainable and affordable for generations to come.

“That’s why we have asked a very experienced set of experts to look at all the evidence.”

Kemi Badenoch has confirmed that Ed Argar is leaving the Shadow Cabinet ahead of her reshuffle.

Mr Argar, who acted as Shadow Secretary of State for Health and Social Care, suffered a health scare earlier this summer.

Mrs Badenoch said: “As he prepares for his last parliamentary oral questions from the front bench, I want to put on record my sincere thanks to Ed Argar for serving in my Shadow Cabinet.

“I wish him the very best for a speedy recovery and return to full health, and so I will be making a few changes.”

A list of full changes to the Conservative front bench team will be announced on Tuesday afternoon.

Here’s what we already know:

• Sir James Cleverly is expected to return to the Conservative front bench.
• Allies of shadow chancellor Sir Mel Stride believe he will remain in his post, despite reports that Robert Jenrick, shadow justice secretary, covets the role.
• Questions remain as to whether the likes of Suella Braverman will return to the front bench.

David Lammy says he feels “appalled” and “sickened” by Israel’s actions in the Gaza Strip.

Asked for his personal reaction to the scenes in Gaza, the Foreign Secretary told BBC Breakfast: “I feel the same as the British public: appalled, sickened. I described what I saw, yesterday in Parliament, as grotesque.

“These are not words that are usually used by a Foreign Secretary who is attempting to be diplomatic, but when you see innocent children holding out their hand for food, and you see them shot and killed in the way that we have seen in the last few days, of course Britain must call it out.

“Of course Britain must lead others in the statement, as I did yesterday, to call it out.

“Of course we must get on the phone and we must urge Israel to think again, as I did again yesterday.

“We will continue to pressure, we will continue to act, we will continue to urge this Israeli government to listen to 83% of its public who are urging them now to move to a ceasefire so those hostages can come out.”