Javid quits as UK finance minister, replaced by Rishi Sunak
Chancellor resigned in row with Johnson over Treasury advisers
Pound up on hopes of fiscal stimulus in next Budget
Downing St refuses to confirm govt will stick to manifesto spending plans
Sajid Javid resigned as UK finance minister after Prime Minister Boris Johnson demanded he fire his advisers as Downing Street sought to seize control of economic policy from the Treasury.
As what was meant to be a minor reshuffle on Thursday spiralled out of control, Javid was replaced by chief secretary to the Treasury Rishi Sunak who seven months ago was a junior housing minister
The pound rallied to climb 0.6% against the dollar at $1.3040 on speculation that Sunak would increase government spending in the upcomimg Budget - something his predecessor and Downing Street had been at loggerheads over.
Javid said he was "unable to accept the conditions that he (Johnson) had attached" to his offer of reappointment "so I felt that I was left with no option other than to resign".
"The conditions that were attached was a requirement that I replace all my political advisers. These are people who have worked incredibly hard on behalf of, not just the government, but the whole country, done a fantastic job. I was unable to accept those conditions. I don’t believe any self-respecting minister would accept such conditions. And so therefore I felt the best thing to do was to go."
Javid was understood to have been given no advance warning of the changes by Johnson. The proposal was that he sack his political staff, who would be replaced by a central advisers pool run by Downing Street. The move is widely seen as a power grab by the prime minister's right hand man Dominic Cummings.
In a clear warning about centralising control, Javid wrote to Johnson urging him to “ensure the Treasury as an institution retains as much credibility as possible”.
He added that it was "crucial for the effectiveness of government that you have people around you who can give you clear and candid advice, as I have always sought to do".
"I also believe that it is important as leaders to have trusted teams that reflect the character and integrity that you would wish to be associated with."
Labour Party shadow finance minister John McDonnell said Cummings had “clearly won the battle to take absolute control of the Treasury and install his stooge as chancellor”.
“This must be a historical record, with the government in crisis after just over two months in power,” he said.
The relationship between Javid and Cummings had become increasingly strained in recent months, the catalyst being Cummings very public sacking of the Javid's press secretary who was marched out of Downing Street by an armed police officer.
Sunak now has about three weeks to put together a Budget which Johnson and Cummings claim will unleash a wave of public spending, particularly in the North where the Conservatives grabbed Labour seats at the last General Election. Downing Street refused to confirm whether the government would stick to the strict spending plans laid out in the party's manifesto or indeed whether the Budget would take place on March 11.
JOHNSON'S PURGE OF DISSENTERS
Johnson and Cummings also took the opportunity to eliminate dissenters from the Cabinet as he fired Andrea Leadsom as Business Secretary and the popular Julian Smith from the Northern Ireland portfolio.
The hard-right Brexiter Leadsom was given her marching orders as Johnson undertook a mild shake-up of senior posts. Her fellow hardliners, Housing minister Esther McVey and the Environment Secretary Theresa Villiers, were also shown the door.
The most controversial dismissal was that of Northern Ireland Secretary Julian Smith, widely regarded as one of the more competent occupants of the post in recent memory who delivered a restored parliament at Stormont after three years of stasis. He was replaced by Brandon Lewis.
However, Smith had reportedly clashed with Johnson over Brexit, and was clearly punished for in the summer saying that a no-deal Brexit would be “very, very bad” Northern Ireland. He also irked his leader for allowing retrospective investigations into the actions of British troops against republican paramilitaries and Catholic civilians during the army's occupation of the province in the 1970s and 80s.
SDLP leader Colum Eastwood slammed Johnson's decision to fire Smith. "It defies belief that after the successful restoration of power sharing following a three-year collapse, Julian Smith’s reward is a cabinet office P45.
"It tells you all you need to know about Boris Johnson’s attitude to the north that he would sack the most successful secretary of state in a decade. He is at best indifferent."
Eastwood said Smith had been "central to breaking the logjam at Stormont. I found him to be a secretary of state genuinely committed to acting in the interests of devolution rather than imposing a cabinet agenda on this place".
Attorney General Geoffrey Cox, a loyal supporter of Johnson, was also removed. The barrister has clashed with Johnson over legal advice on the Irish backstop clause in the Brexit withdrawal agreement.
CABINET RESHUFFLE - WHO'S IN & OUT
Sajid Javid, Chancellor
Nicky Morgan, Culture Secretary
Julian Smith, Northern Ireland Secretary
Andrea Leadsom, Business Secretary
Theresa Villiers, Environment Secretary
Geoffrey Cox, Attorney General
Esther McVey, Housing Minister
Chris Skidmore, Universities Minister
Nus Ghani, Transport Minister
George Freeman, Transport Minister
PROMOTED (* = promoted from within Cabinet)
Rishi Sunak, Chancellor
Suella Braverman, Attorney General
Alok Sharma, Business Secretary and Minister for COP 26 climate summit*
Anne-Marie Trevelyan, International Development Secretary
Oliver Dowden, Culture Secretary
George Eustice, Environment Secretary
Brandon Lewis, Northern Ireland Secretary*
Stephen Barclay, Chief Secretary to the Treasury
STAYING PUT FOR NOW
Priti Patel, Home Secretary
Dominic Raab, Foreign Secretary
Robert Buckland, Justice Secretary
Matt Hancock, Health Secretary
Liz Truss, Trade Secretary
Robert Jenrick, Communities Secretary
Gavin Williamson, Education Secretary
Ben Wallace, Defence Secretary
Grant Shapps, Transport Secretary
Simon Hart, Welsh Secretary
Alister Jack, Scottish Secretary