LONDON (AP) — British Prime Minister Keir Starmer said Wednesday that Treasury chief Rachel Reeves is secure in her job after a series of government U-turns dented her revenue-raising plans and sparked speculation about her future.
Rumours swirled after Reeves appeared to be in tears in the House of Commons, the day after an embarrassing reversal for the government over its plans to cut welfare spending. Many viewers observed that Reeves looked exhausted and upset as she sat behind Starmer during the weekly Prime Minister’s Questions session.
The Treasury said Reeves was dealing with a “personal matter.” It would not elaborate.
Starmer initially declined to say, when asked by opposition leader Kemi Badenoch, that Reeves would still have her job when the next election is called, likely in 2029.
The pound fell against the U.S. dollar during the session and the cost of government borrowing rose on uncertainty about Reeves' future and the administration's fiscal plans.
Starmer’s press secretary later stressed that Reeves “is going nowhere. She has the prime minister’s full backing.” And the prime minister said Reeves would remain Chancellor of the Exchequer “for a very long time to come.”
“She’s done an excellent job as chancellor and we have delivered inward investment to this country in record numbers," Starmer told the BBC.
He said Reeves' tears had “nothing to do with politics.”
The government is trying to steady the ship after a wobby few days in which it was forced to water down plans to curb welfare spending in order to quell a rebellion by lawmakers from his own party.
In something of a hollow victory, the bill passed its first big House of Commons hurdle on Tuesday after the government appeased Labour Party rebels by softening and delaying cuts to welfare benefits for disabled people. Even so, 49 Labour lawmakers voted against the bill.
The result was a major blow to Starmer’s authority as he approaches the one-year anniversary of his election on Friday, reckoning with a sluggish economy and rock-bottom approval ratings.
It also leaves the Treasury short of money it had counted on to invest in public services, making tax increases more likely. The government has promised not to raise key levies including income tax and sales tax.
The government estimated that its welfare reforms would save 5 billion pounds ($7 billion) a year, but after the changes it's unclear whether they will save any money at all.
The reversal follows a decision in May to drop a plan to end winter home heating subsidies for millions of retirees, which Reeves had also counted on to raise money.
Starmer has endured a turbulent 12 months since the election on July 4, 2024, when his center-left party took 412 of the 650 seats in the House of Commons to end 14 years of Conservative government.
Since then, Starmer has navigated the rapids of a turbulent world, winning praise for rallying international support for Ukraine and persuading U.S. President Donald Trump to sign a trade deal easing tariffs on U.K. goods. But at home his agenda is on the rocks, as inflation remains stubbornly high and economic growth low, frustrating efforts to ease the cost of living.
British Prime Minister Keir Starmer departs 10 Downing Street, London, to attend Prime Minister's Questions at the Houses of Parliament, on Wednesday July 2, 2025. (Lucy North/PA via AP)
DUBAI, United Arab Emirates (AP) — U.S. President Donald Trump said Iran wants to negotiate with Washington after his threat to strike the Islamic Republic over its bloody crackdown on protesters, a move coming as activists said Monday the death toll in the nationwide demonstrations rose to at least 544.
Iran had no immediate reaction to the news, which came after the foreign minister of Oman — long an interlocutor between Washington and Tehran — traveled to Iran this weekend. It also remains unclear just what Iran could promise, particularly as Trump has set strict demands over its nuclear program and its ballistic missile arsenal, which Tehran insists is crucial for its national defense.
Meanwhile Monday, Iran called for pro-government demonstrators to head to the streets in support of the theocracy, a show of force after days of protests directly challenging the rule of 86-year-old Supreme Leader Ayatollah Ali Khamenei. Iranian state television aired chants from the crowd, who shouted “Death to America!” and “Death to Israel!”
Trump and his national security team have been weighing a range of potential responses against Iran including cyberattacks and direct strikes by the U.S. or Israel, according to two people familiar with internal White House discussions who were not authorized to comment publicly and spoke on condition of anonymity.
“The military is looking at it, and we’re looking at some very strong options,” Trump told reporters on Air Force One on Sunday night. Asked about Iran’s threats of retaliation, he said: “If they do that, we will hit them at levels that they’ve never been hit before.”
Trump said that his administration was in talks to set up a meeting with Tehran, but cautioned that he may have to act first as reports of the death toll in Iran mount and the government continues to arrest protesters.
“I think they’re tired of being beat up by the United States,” Trump said. “Iran wants to negotiate.”
He added: “The meeting is being set up, but we may have to act because of what’s happening before the meeting. But a meeting is being set up. Iran called, they want to negotiate.”
Iran through country's parliamentary speaker warned Sunday that the U.S. military and Israel would be “legitimate targets” if America uses force to protect demonstrators.
More than 10,600 people also have been detained over the two weeks of protests, said the U.S.-based Human Rights Activists News Agency, which has been accurate in previous unrest in recent years and gave the death toll. It relies on supporters in Iran crosschecking information. It said 496 of the dead were protesters and 48 were with security forces.
With the internet down in Iran and phone lines cut off, gauging the demonstrations from abroad has grown more difficult. The Associated Press has been unable to independently assess the toll. Iran’s government has not offered overall casualty figures.
Those abroad fear the information blackout is emboldening hard-liners within Iran’s security services to launch a bloody crackdown. Protesters flooded the streets in the country’s capital and its second-largest city on Saturday night into Sunday morning. Online videos purported to show more demonstrations Sunday night into Monday, with a Tehran official acknowledging them in state media.
In Tehran, a witness told the AP that the streets of the capital empty at the sunset call to prayers each night. By the Isha, or nighttime prayer, the streets are deserted.
Part of that stems from the fear of getting caught in the crackdown. Police sent the public a text message that warned: “Given the presence of terrorist groups and armed individuals in some gatherings last night and their plans to cause death, and the firm decision to not tolerate any appeasement and to deal decisively with the rioters, families are strongly advised to take care of their youth and teenagers.”
Another text, which claimed to come from the intelligence arm of the paramilitary Revolutionary Guard, also directly warned people not to take part in demonstrations.
“Dear parents, in view of the enemy’s plan to increase the level of naked violence and the decision to kill people, ... refrain from being on the streets and gathering in places involved in violence, and inform your children about the consequences of cooperating with terrorist mercenaries, which is an example of treason against the country,” the text warned.
The witness spoke to the AP on condition of anonymity due to the ongoing crackdown.
The demonstrations began Dec. 28 over the collapse of the Iranian rial currency, which trades at over 1.4 million to $1, as the country’s economy is squeezed by international sanctions in part levied over its nuclear program. The protests intensified and grew into calls directly challenging Iran’s theocracy.
Nikhinson reported from aboard Air Force One.
In this frame grab from video obtained by the AP outside Iran, a masked demonstrator holds a picture of Iran's Crown Prince Reza Pahlavi during a protest in Tehran, Iran, Friday, January. 9, 2026. (UGC via AP)
In this frame grab from footage circulating on social media from Iran shows protesters taking to the streets despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world in Tehran, Iran, Friday, Jan. 9, 2026.(UGC via AP)
In this frame grab from footage circulating on social media from Iran showed protesters once again taking to the streets of Tehran despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world in Tehran, Iran, Saturday Jan. 10, 2026. (UGC via AP)
