(Sharecast News) - Incoming prime minister Andy Burnham has decided to make home secretary Shabana Mahmood chancellor, it was reported on Thursday.
A spokesperson for Burnham declined to comment on "speculation", and said cabinet positions would be announced on Monday when the former Greater Manchester mayor is due to move into Downing Street.

But according to the Financial Times, citing three unnamed sources briefed on Burnham's thinking, Mahmood will be moving to Number 11. "Shabana is nailed down as chancellor," one source told the newspaper. "That's definitely happening."

There has been considerable speculation about who will replace Rachel Reeves as chancellor under Burnham. Energy secretary and former Treasury advisor Ed Miliband had been seen as a leading contender. But his focus on net zero has alienated some corporate leaders and unions, on fears that it will damage the economy, making him a risker choice for many in Burnham's team.

Mahmood - who comes from the right of the Labour Party - became home secretary last year, replacing Yvette Cooper in a cabinet reshuffle. She has not held an economic brief in government though is widely seen as a capable minister.

Markets appeared to welcome the potential appointment, with the pound rising and 10-year gilt yields easing.

Separately on Thursday it was also reported that Varun Chandra had agreed to stay in post when Burnham enters Number 10. Chandra is Starmer's leading business advisor, and was instrumental in securing the US-UK trade deal as well as having strong connections in the Gulf and India.

Although he is understood to have received approaches about returning to the private sector, according to the FT and Sky News, Chandra has told colleagues he wants to provide "continuity" in Number 10 and will therefore stay on. Burnham's team has also reportedly asked him to stay.

• News Channel