Rishi Sunak reshuffle – live: PM finally replaces Zahawi, but Raab survives

BBC chairman Richard Sharp has denied that he gave Boris Johnson financial advice as he appeared before culture select committee, after the disclosure that he helped him secure a loan of up to £800,000 before the then-prime minister backed his appointment to lead the broadcaster.

Mr Sharp said his old friend Sam Blythe – Mr Johnson’s cousin – raised concerns that Mr Johnson was having financial difficulties and wanted to help.

“I said to him at that time: ‘You may be a family member, but you need to be very careful. Things need to be done by the book. There are rules in this country and these rules exist for a good reason. You’re a foreigner and therefore before you contemplate doing anything, or providing any assistance to the prime minister, you should involve the Cabinet Office’.”

Rishi Sunak’s loyal ally Greg Hands has been named as the successor for Nadhim Zahawi as Tory chair.

The PM has broken up the Department for Business, Energy and Industrial Strategy (BEIS) into separate ministries – creating a new energy department and merging trade into business.

Business secretary Grant Shaps has been moved to become the new energy and net zero secretary, while Kemi Badenoch is set be the new business and trade secretary as part of the big Whitehall shake up.

Mr Sunak has also split up the Digital, Culture, Media and Sport (DCMS) department. The former department head Michelle Donelan takes up a new role as science, innovation and technology secretary, while Lucy Frazer is named the new culture secretary.

Rishi Sunak wanted Michael Gove to be his science and technology secretary at the new department, but the senior figure asked to stay at the levelling up department, according to reports. No 10 has not denied that he turned down the offer.

Grant Shapps has said he is “delighted” to be leading the new Department for Energy Security & Net Zero. He said his focus would be “securing our long-term energy supply, bringing down bills and thereby helping to halve inflation”.

And Greg Hands has said he is “excited” to be the new Conservative chairman, adding: “The work starts right away.”

Labour Barry Sheerman has urged all MPs to admit “we are poorer in this country because of Brexit”.

The MP for Huddersfield asked chancellor Jeremy Hunt if he agreed with comments by former Tory home secretary Amber Rudd that some Brexiteers, after “a few drinks”, will admit it had been disastrous.

He added: “Could we on all benches admit we are poorer in this country because of Brexit and do something about it?”

Mr Hunt – a Remainer – replied: “If Labour really are against Brexit, they should have the courage of their convictions and say they want to rejoin the EU and that is the problem because they don’t believe they can make a success of it, they will never be able to run the British economy under it.”

The Institute for Government estimates that creating new department costs at least £15m, “with a further estimated cost of up to £34m when including loss of productivity as staff adjust to the new organisation”.

The Lib Dems’ Christine Jardine said: “Rather than fritter away tens of millions of taxpayers’ cash on costly vanity projects, [Rishi] Sunak should spend the money where it’s most needed. This cash could fund 25 million free school meals.”

Rishi Sunak said the creation of four new departments – two entirely new, and new significantly changed – would “focus teams on the issues that will build a better future for our children and grandchildren”.

Right-wing Tory Lee Anderson has been named deputy chairman of the Conservative party.

The controversial MP has previously claimed there was no “massive need” for food banks, and said food banks failed to cannot “budget properly”.

Thanks. That’s all from our live politics coverage for today, after Rishi Sunak announced his shake-up of four government departments and revealed Greg Hands would be taking over from Nadhim Zahawi as Tory chairman.