Rachel Reeves 'told Sadiq Khan to 'get out of my office!' and kicked him out when London mayor demanded more cash for the capital'
- Are you concerned about how the budget will affect YOU? Join our live Q&A with expert Simon Lambert at 4pm for all the help you need
Rachel Reeves allegedly kicked Sir Sadiq Khan out of her office in an extraordinary argument while he tried to negotiate more funding for London ahead of the Budget.
The Chancellor is said to have called an early end to the meeting with the London Mayor after they had a major disagreement, shouting at him: 'Get out of my office!'
Several sources claimed to the New Statesmen and Standard that Ms Reeves cut short the scheduled meeting earlier this year before the second half could begin.
The disagreement came as Sir Sadiq was trying to lobby his Labour colleague for more money to fund transport projects and other investments in the capital.
Ms Reeves was asked about the reports of a bust-up by LBC radio presenter Nick Ferrari on his show this morning, and told him: 'I don't recognise that.
'Yesterday in the Budget, we've put in money for the Lower Thames Crossing, which eases congestion within London, and the DLR extension out to Thamesmead and in London, kids are going to be lifted out of poverty from this Budget.'
But Mr Ferrari pressed her, saying he 'wasn't referring to yesterday' but instead to the claim that she had told Sir Sadiq to 'get out of her office'.
The Chancellor responded: 'I don't recognise that characterisation. I have got a great relationship with Sadiq, and I saw him just a couple of weeks ago at Remembrance Sunday at the Cenotaph.
'And I was pleased yesterday to be able to set extra support to get that DLR extension, to boost growth and get more houses built in that part of London.'
Sir Sadiq Khan and Rachel Reeves at the Francis Crick Institute in London in April 2024
Chancellor Rachel Reeves delivers her Budget in the House of Commons yesterday afternoon
The Mayor and Chancellor have been at odds in the past, including over the expansion of Heathrow Airport with Sir Sadiq against the Government's plans for a third runway.
The Mayor also found senior Labour figures were unwilling to support the expansion of his Ultra Low Emission Zone (Ulez) policy ahead of last year's General Election.
And in June, Sir Sadiq said Ms Reeves had made 'a colossal mistake in pitting London against the rest of the country' after she did not back new transport links in the city.
Neil Garratt, City Hall Conservatives's Budget spokesman, told the Daily Mail today: 'Sadiq promised a Labour government would be the 'wind in his sails' and 'usher in a decade of renewal for London.
'He's failed to deliver for London with a Labour government. Londoners deserve a Mayor the Government takes seriously, or we will keep losing out.'
Ms Reeves confirmed in her full Budget document yesterday – but not her speech - that the Docklands Light Railway can be extended to Thamesmead.
A new line will be built for the DLR in South East London from Gallions Reach to a new station at Beckton Riverside and then across the River Thames to Thamesmead.
However, the Budget did not include funding for the Bakerloo line extension or the West London Orbital, a new Overground line from Hounslow to Hendon.
Sir Sadiq did welcome the news that visitors to English cities including London could face paying a new tourist tax to fund local projects.
Mayors will be given the power to impose a 'modest' charge on visitors staying in hotels, bed and breakfasts, guest houses and holiday lets.
The measure has been called for by Sir Sadiq and Greater Manchester's Andy Burnham, but was condemned as 'damaging' by the hospitality industry.
Sir Sadiq said yesterday: 'Giving mayors the powers to raise a tourist levy is great news for London. The extra funding will directly support London's economy, and help cement our reputation as a global tourism and business destination.'
The plans will be subject to a consultation running until February 18, which will consider issues including whether there should be a cap on the size of the levy.
It comes as Ms Reeves will face further questions today after delivering her Budget that raised tax by £26billion but was overshadowed by an unprecedented leak.
The Chancellor's decisions put Britain on course for a record tax burden as she hiked levies after weaker economic forecasts left holes in her previous spending plans.
The increases are also needed to pay for increased welfare spending, with Ms Reeves announcing the abolition of the two-child benefit cap, expected to lift 450,000 children out of poverty.
Rachel Reeves has confirmed the Docklands Light Railway can be extended to Thamesmead
The Budget did not include funding for the West London Orbital which is a new Overground line
Having abandoned plans for a manifesto-busting income tax rise, the Chancellor opted for a range of smaller tax increases to pay for Government spending and build a larger buffer against her borrowing rules.
These include a new pay-per-mile tax for electric vehicles, increased taxes on online betting and a 'mansion tax' on homes worth more than £2million.
But she continued to face accusations of breaching Labour's election promise not to raise taxes on 'working people' after deciding to keep tax thresholds frozen until 2030/31 and levying national insurance on some pension contributions.
The Budget announcement was overshadowed by an unprecedented blunder that saw the Office for Budget Responsibility publish its assessment of the economy and the Chancellor's plans before Ms Reeves had even begun her speech.
The Daily Mail has contacted the Mayor's office and the Treasury for comment.
