Sir Keir Starmer dodged questions on Friday over a severance payment for Sue Gray after she was ousted as his No10 chief-of-staff.
Speaking in Edinburgh after a meeting of mayors and nation leaders, he instead sought to keep the focus on an upcoming investment summit in London and other steps to boost Britain’s economy.
Asked if he had approved a severance deal for Ms Gray, the Prime Minister said: “We have had a really important meeting today of the Council of regions and nations which is hugely important for the country.
“We have had a huge investment of £24 billion...”
Pressed again on the severance payment question, he continued: “£24 billion which will be replicated in jobs across the country.
“That’s really important as we head towards that investment summit on Monday (in London), a major event and then onto the Budget we are re-setting and changing the way we run this country.”
Earlier, it was confirmed that Ms Gray is on a “short break” after the No10 clashes which led up to her departure from the top Downing Street role.
Cabinet Office minister Pat McFadden, one of the Prime Minister’s closest allies, stressed the senior civil servant had “been through quite a lot in the last few weeks”, and had not “enjoyed” being in the public spotlight.
He added that what was now key for the new Labour government, hit by the Gray and freebies controversies, was to have a “good Budget” to boost the economy.
Ms Gray is missing a meeting of regional leaders on Friday which is seen as key to her new role.
He hailed the announcement of around £24 billion in investment for green projects across Britain as a “vote of confidence” in the UK ahead of the talks, which will focus on driving growth across different parts of the country.
However, Ms Gray, whose new position as “envoy to the nations and regions” was confirmed on Sunday after weeks of turmoil behind the scenes in Number 10, will be a notable absence as she takes a brief hiatus before changing jobs.
“Sue has been through quite a lot in the last few weeks,” Mr McFadden told Sky News.
“I work with her, she is a great colleague, she has taken a short break now.
“I think we should allow her the time and privacy to do that.”
Pressed whether she would get a severance payment, he added on Times Radio "Whatever contractually is there, I'msure she would be but, you know, I can't comment on anybody's individual circumstances."Explaining the shake-up at No10, Mr McFadden: “We have got a new chief-of-staff in Morgan McSweeney, we are a new government, the Prime Minister had to make a few changes, he’s appointed a new chief-of-staff...
“I think that will put us on a good footing going forward.”
Welcoming the latest GDP figures showing 0.2 per cent growth in August, and looking forward to an investment summit in London next week, he added: “Whatever the headlines...the most important thing is that we have a good Budget that puts the country on a more stable footing, that gets investment going, gets us more good jobs, more prosperity and makes the country stronger.”
He declined to comment on what taxes may be raised by Chancellor Rachel Reeves in the Budget on October 30.
Questions about the details of Ms Gray’s role as envoy have mounted this week, with further information expected to be set out by the Cabinet Office shortly.
Cabinet ministers have insisted there is a strong team inside Downing Street despite Ms Gray being replaced by former campaign manager Mr McSweeney after weeks of leaks and hostile briefings against her.
Ms Gray, a former senior civil servant with decades of Whitehall experience, cited “intense commentary about my position” that risked becoming a “distraction” when she stood down.
On Friday Sir Keir will meet first ministers, deputy ministers and regional mayors as part of an effort to “rewire” the way the UK Government interacts with devolved powers and discuss how to boost business ahead of the International Investment Summit next week.
Labour leaders including Sadiq Khan welcomed the gathering, but SNP First Minister John Swinney vowed to use the meeting to talk about how to “stop the austerity agenda.”
Ahead of the first council meeting, Downing Street announced around £24billion in private investment for Britain’s clean power projects, including Iberdrola - one of Europe’s biggest energy firms - doubling its backing from £12billion to £24billion through Scottish Power over the next four years.
Sir Keir said: “Today’s investments are a huge vote of confidence in this government and our relentless focus to drive growth across the UK.
“Whether you’re in Scotland, Wales, Northern Ireland or England - we are creating the conditions for businesses to thrive, and our International Investment Summit will be a springboard for every part of the UK to be an engine of innovation and investment.
“Today I’m convening the first ever Council of Nations and Regions, because it is when we work together in the spirit of genuine partnership, that we can deliver the real change people want to see and improve opportunities for all.”
Mr Swinney said he would “speak frankly about the big issues” north of the border, adding that “I hope to persuade the Prime Minister of the transformative potential of public sector investment to stop the austerity agenda”.
The First Minister has committed to the reset in relations sought by the Labour administration with devolved powers, though the SNP remains strongly opposed to the decision to cut the winter fuel payment.
Meanwhile London Mayor Mr Khan hailed the gathering as a “watershed moment” which made clear “this Government understands that harnessing the power of our nations and city regions can play a major role in tackling some of the biggest issues we face as a country”.
