Downing Street insisted that Boris Johnson has full confidence in Chancellor Rishi Sunak today amid claims the Prime Minister discussed demoting the Chancellor.
Mr Johnson reportedly 'went tonto' in front of staff at a Downing Street meeting last week about the leak of a letter from the Chancellor calling for the easing of travel restrictions ahead of the relaxations announced last Wednesday.
He is said to have mulled in front of a room full of aides moving the Chancellor to Health Secretary - a demotion from one of the four great offices of state.
Allies of the Chancellor last night warned that sacking Mr Sunak would see the Prime Minister 'lose direction completely'.
Today the Prime Minister's official spokesman said there were no imminent plans for a Cabinet reshuffle, saying: 'The Prime Minister and the Chancellor have always enjoyed a close and effective working relationship, and will continue to do so.'
Mr Sunak is the clear frontrunner among Tory activists to be the next Conservative Party leader.
A survey of the Tory grassroots by the Conservative Home website last week found almost a third - 31 per cent - believe the Chancellor should succeed Boris Johnson.
The findings were published as a separate survey conducted by the website showed Mr Johnson's approval rating among the Tory faithful has plummeted by more than 30 points since he tried to dodge self-isolation.
Treasury insiders were forced to hit back at claims of a rift between Boris Johnson and Rishi Sunak last night after reports the Prime Minister (pictured) threatened to demote the Chancellor
Mr Johnson was said to be furious about the leak of a letter from the Chancellor (pictured) calling for the easing of travel restrictions ahead of the relaxations announced last Wednesday
A survey of the Tory grassroots by the Conservative Home website found almost a third - 31 per cent - believe the Chancellor should succeed Boris Johnson
Business Secretary Kwasi Kwarteng said that, while the two men generally got on well together, disagreements between No 10 and No 11 were inevitable at times.
'There are always disagreements. There was always going to be a slight creative tension perhaps between No 10 and No 11,' he told the BBC Radio 4 Today programme.
'I can't remember a time in the last 30 years when there hasn't been a debate, conversations, between the Prime Minister and the Chancellor.
'I happen to think that this Prime Minister and this Chancellor are working very closely together.
'They are as cohesive as any relationship of that kind that I have seen.'
The Prime Minister reportedly told allies that Mr Sunak was guilty of 'a failure of political judgment' in writing the letter.
He suggested demoting the Chancellor to Health Secretary – seen as one of the least desirable jobs in Government – at a meeting last Monday, it was reported.
However an ally of Mr Sunak has said the Chancellor would never agree to such a move and would opt for the back benches over a demotion.
The source told The Times: 'If he loses Rishi, he loses direction completely.
'He would have the most likely contender to replace him on the back benches. He's not going to take a demotion. That would be ridiculous.'
Last night, Treasury insiders were forced to hit back at claims of a rift between Mr Johnson and Mr Sunak.
Sources said there were 'no tensions' between the Downing Street neighbours despite the PM allegedly going 'tonto' in front of staff at a meeting last week.
It was claimed the PM had not seen the letter from his Chancellor until it appeared in a newspaper.
But last night sources close to Mr Sunak insisted the pair have a good working relationship compared to former chancellors and prime ministers.
A Treasury insider said there is 'always a tension around how money is spent and the accountability for it' and suggested the PM was just 'a bit tired and a bit fed up' about the leak.
'The Prime Minister is known for speaking in a half-joking, half-serious way and I think he was probably irritated and it has spilled over into what he has said,' they said.
'I don't think he is seriously contemplating [replacing Sajid Javid as Health Secretary].
'It's ridiculous and virtually everyone in Parliament thinks that the Chancellor is doing a fantastic job and has got a grip on a very complex equation.'
They suggested demoting Mr Sunak would backfire on Mr Johnson, saying that the Chancellor 'wouldn't be the one who would be damaged' by the move – and pointed to his popularity in the polls.
The suggestion that the Prime Minister went 'tonto' during last Monday's meeting had been reported in The Sunday Times.
It was also said yesterday that Mr Johnson had told allies that by writing the letter, which was copied to the Department for Transport, it was 'bound' to be leaked. But sources said it was commonplace for chancellors to write to prime ministers to keep a paper record of decisions.
Another insisted the pair were 'aligned' in the need to provide 'a credible way' of funding key policies – such as social care.
And a Government source said the reports 'couldn't be further from the truth', adding: 'There is absolutely nothing in terms of a rift.'
Yet Mr Johnson and Mr Sunak have found themselves at odds over the Prime Minister's expensive agenda – including infrastructure projects and a new royal yacht. Rumours of rifts between chancellors are as old as the offices they hold.
Lord Palmerston and William Gladstone clashed over duties on paper – seen as a tax on knowledge – in the 1860s. In more recent years, Gordon Brown and Tony Blair sparred over how tight a grip they should hold on the public purse.
George Osborne (left) and David Cameron (right) were one of the few Downing Street duos whose friendship survived their time at the top
Philip Hammond considered quitting as chancellor in the final weeks of Theresa May's premiership over her plans to spend billions on projects to shore up her legacy.
George Osborne and David Cameron were one of the few Downing Street duos whose friendship survived their time at the top.
Shadow chief secretary to the Treasury Bridget Phillipson yesterday accused Mr Johnson of being 'busy picking fights' with ministers despite the major difficulties he faces. She said: 'The Prime Minister urgently needs to get a grip on the real challenges facing this country.
'The Covid pandemic continues, tens of thousands of livelihoods are still at risk, the climate crisis threatens our planet, but he's busy picking fights with his own Government and threatening to sack the Chancellor. It's completely disgraceful.'
A Treasury source said: 'The Chancellor is solely focused on securing the country's economic recovery and continuing to protect and create jobs.'
Be wise, Boris, and don't repeat Maggie's mistake
By Simon Walters for the Daily Mail
Personal and political tensions with their Downing Street neighbours played a large part in the demise of the two most powerful Prime Ministers of the past 50 years.
Tony Blair was undermined from his first day in office by a bitter Gordon Brown, who never even let Blair see his Budget speeches in advance.
The downfall of Mrs Thatcher, meanwhile, was triggered by her former Chancellor Geoffrey Howe, who avenged years of being treated with contempt by the Iron Lady with a devastating Commons attack on her.
By contrast, Boris Johnson's relations with Rishi Sunak since he promoted him from nowhere to be Chancellor last year have been surprisingly friendly... until now.
The downfall of Mrs Thatcher, meanwhile, was triggered by her former Chancellor Geoffrey Howe, who avenged years of being treated with contempt by the Iron Lady with a devastating Commons attack on her
The Prime Minister is said to have been so enraged by a leaked letter from Sunak – in which the Chancellor demanded Covid travel curbs be eased to save the economy and summer holidays – that he threatened to demote him to Health Secretary.
Boris, it is also claimed, is attracted by the idea of appointing Liz Truss, currently the International Trade Secretary and a rising star in the Tory Party, as Britain's first woman Chancellor.
Boris's fury is taking place in the context of a poll that shows an astounding 36-point drop in his once rock-solid ratings among Tory voters.
Meanwhile, Sunak's popularity in the same survey by the influential ConservativeHome website remains sky-high.
Nobody seriously believes that Sunak is out to topple Johnson. And the Chancellor is well aware that when he sends out tax bills to pay for the generous economic policies deployed during the pandemic – he could go quickly from hero to villain.
By contrast, Boris Johnson's relations with Rishi Sunak since he promoted him from nowhere to be Chancellor last year have been surprisingly friendly... until now
Having said that, it is impossible not to be impressed by the rise of Sunak, who was a political unknown before he took over the Treasury last February.
His performance as Chancellor has been as sharp as his ankle-skimming suits, and he has yet to put a foot wrong.
Johnson, however, committed another gaffe only last week when he made an off-colour joke about Mrs Thatcher's ruthless closure of the coal mines during the 1980s: comments said to have offended voters in the Tories' 'Red Wall' of northern seats.
Though Johnson and Sunak initially formed a rock-solid alliance to deal with the pandemic, fault lines have emerged between them in recent weeks – from divisions over Boris's new 'Royal Yacht' plan to his 'levelling-up' agenda.
It all costs money, and Sunak – who did book-keeping for his mother's pharmacy as a teenager – has his hands firmly on the purse strings. The disagreements have highlighted the stark differences between the two in both style and substance.
The Prime Minister is said to have been so enraged by a leaked letter from Sunak – in which the Chancellor demanded Covid travel curbs be eased to save the economy and summer holidays – that he threatened to demote him to Health Secretary
'Boris announces grand projects out of the blue without thinking how to pay for them,' said one Conservative adviser.
'He wouldn't have a clue how to read a balance sheet. Rishi doesn't have Boris's common touch but he can spot a few missing pence.'
Their relationship is so closely watched that even the Sunaks's acquisition last month of a labrador puppy, Nova, was seen by cynics as an attempt to upstage Mr Johnson and wife Carrie's beloved Jack Russell-cross, Dilyn.
Let's be clear: having won a landslide election victory less than two years ago and following the success of the Covid vaccine roll-out – all helped by a weak and divided opposition Labour party – it is surely too early to be writing Mr Johnson's political obituary. However, for all his unique talents, the Prime Minister's friends say he has never been interested, as Thatcher and Blair were, in spending a decade at No10.
He intends to return to his main, highly-lucrative passion: writing.
And unlike Thatcher and Blair at the same stage of their Prime Ministerial careers, having brought about and delivered Brexit, Johnson's place in the history books is guaranteed.
Tony Blair was undermined from his first day in office by a bitter Gordon Brown, who never even let Blair see his Budget speeches in advance
The all-encompassing nature of the pandemic has made it difficult for him to add a second chapter to his tenure after 'getting Brexit done'.
But in my view, he is more likely to achieve that by working together with the loyal and even-tempered Sunak, rather than by fulminating wildly in private about him.
If Mr Johnson is seriously considering carrying out his reported threat to demote Sunak to Health Secretary, he might care to reflect on Mrs Thatcher's fate after she dished out a similar unmerited punishment to Howe, who had been her first Chancellor.
Irked chiefly by his opposition to her anti-European views, and emboldened by a landslide election victory two years earlier, she humiliatingly gave Howe, then the Foreign Secretary, the Cabinet dogsbody job of Commons Leader in 1989.
But if Thatcher thought she had put him in his place, just 16 months later, the mild-mannered Howe moved against her. She was gone in three weeks.
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