Andy Burnham LIVE as Ed Miliband and John Healey confirmed in key cabinet roles as Angela Rayner arrives at Downing Street

John Healey has been appointed as Andy Burnham’s new chancellor, just over a month after dramatically quitting as defence secretary amid an argument about defence funding.

Mr Healey, a stalwart of Labour’s front bench, had held the defence brief since Sir Keir won the party leadership in 2020, first in the shadow cabinet, then retaining the job after Labour’s 2024 general election landslide.

His shock resignation in early June came amid a row over defence spending. Mr Healey did not believe the defence investment plan (Dip) provided enough cash to prepare the armed forces for the future.

He laid the blame at the Treasury’s door for not stumping up the amount military chiefs believed were needed for the Dip and has now returned to government to run the department he publicly clashed with.

In his resignation letter, he said he was left with “no other option” than to resign as he could not accept settlement for the long-awaited Dip “that would reduce the readiness of our forces and increase the risk to personnel on operations, and could make the country less safe”.

He said he was leaving with “great regret and reluctance” because the Prime Minister had been “unable, and the Treasury has been unwilling, to commit the resources that the nation needs to defend the country at this time of rising threats”.

Sources within Mr Burnham’s new Government billed Mr Healey as an experienced and trusted figure who shares the same outlook as new the PM, and is respected on the international stage.

Mr Healey served in the Blair and Brown governments as well as the shadow cabinets of Ed Miliband and Jeremy Corbyn.