Rachel Reeves was last night under pressure to ‘come clean’ about her employment past, amid claims she was investigated for fiddling her expenses.
The Chancellor is battling to maintain her credibility after admitting to further inaccurate claims on her much-mocked CV.
Last night she came out fighting over allegations that she was investigated over her expenses claims shortly before leaving her job in the customer relations department of HBOS bank in 2009.
A BBC investigation reported that the bank launched an internal audit into Ms Reeves and two fellow managers after a whistleblower complained they were using their company expense accounts to ‘fund a lifestyle’.
Inappropriate spending is said to have included lavish dinners, taxis and gifts, including for each other.
Ms Reeves is said to have bought a £152 handbag on expenses as a Christmas gift for her boss in 2008.
The boss, who signed off Ms Reeves’ claims, gave her a £55 wine gift the same Christmas.
Other expenses-funded purchases by Ms Reeves are said to have included perfume, jewellery and wine.
Rachel Reeves is battling to maintain her credibility after admitting to further inaccurate claims on her already much-mocked CV
Ms Reeves (bottom left) pictured with other HBOS staff at the Council of Mortgage Lenders annual lunch in March 2006
The Chancellor came out fighting over separate allegations that she was investigated over her expenses claims shortly before she left her job in the customer relations department of HBOS bank in 2009
Treasury sources said the Chancellor was not aware of any investigation into her conduct at HBOS and she left the bank on ‘good terms’ when it was restructured after the financial crisis.
But Kemi Badenoch urged her to ‘come clean’. The Tory leader said the investigation raised ‘serious questions’.
She added: ‘Keir Starmer said “restoring trust in politics is the great test of our era”. Until she comes clean – not just about her CV but about the circumstances in which she left HBOS – no one will take him seriously.’
Senior Labour MP Siobhain McDonagh referred to the allegations as an ‘expenses scandal’ and urged the Chancellor to set out the facts.
‘As far as I’m aware she absolutely denies that she was approached by anybody about the expenses scandal,’ she told the BBC’s Politics Live show.
Ms Reeves faced mockery last year after it emerged that she had wrongly claimed to work as an economist at HBOS, when she was actually employed in customer services.
She has also claimed repeatedly to have spent ‘a decade working as an economist at the Bank of England’.
But it has emerged that she had left the Bank to work at HBOS by March 2006 – nine months earlier than stated on her LinkedIn profile.
Kemi Badenoch said the investigation raised ‘serious questions’ for the embattled Chancellor
Her time at the Bank in fact spanned just five-and-a-half years, of which almost a year was spent studying for a Masters degree at the London School of Economics.
A Treasury spokesman said the wrong dates were the result of an error by a member of staff and had been corrected.
Ms Reeves is said to have not looked at her LinkedIn profile to ensure it was correct, despite the controversy about it last year.
Sir Keir insisted he retained full confidence in the Chancellor and had no concerns about her past conduct.
Asked whether he was comfortable with the Chancellor appearing to exaggerate her relevant experience, he said: ‘Rachel Reeves has dealt with any issues that arise.
‘She delivered a really important Budget for the country that balanced the books, gave us stability, that is beginning to see interest rates come down, mortgages coming down as a result… beginning to see some of the growth we need.’
But former Tory chairman Richard Holden said: ‘You can claim to have worked somewhere for a decade when you were there five years. You can claim you worked as an economist when you were a customer services manager… You can claim what you like, but the issue you face rapidly becomes one of credibility.
‘Rachel Reeves has lost her credibility and the fact that Sir Keir Starmer cannot see that is damaging his.’
Sir Keir Starmer insisted he retained full confidence in the Chancellor and had no concerns about her past conduct
Ms Reeves, who turned 46 yesterday, is in charge of £1.2 trillion of government spending
The revelations came on a day when official figures showed that the economy grew by just 0.1 per cent in the final quarter of last year. Real GDP per head fell by 0.1 per cent in the same period.
Ms Reeves, who turned 46 yesterday, is in charge of £1.2 trillion of government spending.
She has worked to project a frugal image, including revealing that she takes a packed lunch to work to save money.
But the BBC investigation paints a different picture of her time working at HBOS, now part of Lloyds Banking Group.
The bank is said to have launched an ‘internal audit’ after a whistleblower filed a six-page complaint, accompanied by dozens of pages of evidence, including receipts, about the conduct of Ms Reeves and two fellow managers.
In April 2009, the audit is said to have found there was a case to answer. The following month, Ms Reeves and her boss left the bank. The third manager was on sick leave and did not return to the bank. Ms Reeves did not get another job until she was elected as MP for Leeds West 12 months later.
A spokesman for Ms Reeves said she was ‘not aware of an investigation nor was she interviewed, and she did not face any disciplinary action on this or any other matters’.
They added: ‘All expenses were submitted and signed off in the proper way. Several former colleagues from her time at the bank… have corroborated this account. Rachel left HBOS in 2009 on good terms.’
Receipts seen by the BBC showed that Ms Reeves bought earrings for her PA, which she claimed back on expenses.
Her PA, Linda Barrowclough, said she had received Christmas and birthday gifts from Ms Reeves but had assumed they were ‘personal gifts [and] they’d have come out of her own pocket’.
Lloyds Banking Group said: ‘We do not comment on current or former employees’.