It was unclear what might happen in the hours ahead, but supporters of the prime minister who were in the meeting said that there had been no direct challenges to Mr. Starmer during the discussion.
Mr. Starmer has been facing a fast-moving rebellion within his party after it suffered major losses in last week’s local elections in England, and in parliamentary elections in Scotland and Wales. Dozens of Labour Party lawmakers have publicly urged him to set out a timetable for his resignation to allow a contest to find his successor.
Miatta Fahnbulleh, a junior minister, resigned from the government just as the cabinet meeting started. A second junior minister, Jess Phillips, resigned later, writing that Mr. Starmer was “a good man fundamentally” but that he had been too unwilling to fight for the things the Labour Party believes in. A third minister, Alex Davies-Jones, resigned soon after.
Attention now shifts to Wes Streeting, the health secretary, who has made no secret of his desire to challenge Mr. Starmer. But he would need the backing of at least 81 Labour lawmakers to formally trigger a leadership contest. It was unclear on Tuesday whether Mr. Streeting, or any other possible candidate, had enough support to make that happen.
Some of Mr. Starmer’s fiercest critics do not want him to leave office immediately, but rather to announce that he will step down in the fall. That would give the party time to organize a contest to succeed him that might include Andy Burnham, the mayor of Greater Manchester, who appears to have political momentum behind him. But Mr. Burnham would need to win a seat in Parliament first in a special election, something that would take weeks if not months.
Here’s what to know:
Growing discontent: At least 80 Labour Party lawmakers — about one-fifth of its members of Parliament — have called on Mr. Starmer to step down or set up a timeline for his resignation, according to the BBC.
Forcing a fight: If Mr. Starmer refuses to step aside, Labour lawmakers could force a leadership election. Here’s how a challenge could play out.
Possible challengers: In addition to Mr. Burnham and Mr. Streeting, others who could challenge Mr. Starmer include Angela Rayner, who served as deputy prime minister before stepping aside amid questions about her personal taxes.
Jittery markets: The fragility of Mr. Starmer’s position was not received well in financial markets on Tuesday. The pound was initially down 0.5 percent against the dollar at $1.35. Yields on British government bonds (which move inversely to prices) jumped as markets opened.
But perhaps the most damaging error was the appointment of Peter Mandelson to the position of Britain’s ambassador to Washington. Mr. Mandelson, a veteran Labour politician, was fired from that post by Mr. Starmer last September after leaked emails revealed the extent of Mr. Mandelson’s friendship with Jeffrey Epstein, the convicted sex offender.
Revelations about Mr. Mandelson have shaken Mr. Starmer’s government and damaged his credibility, contributing to his record-low approval ratings, with political opponents and allies saying that the prime minister exercised poor judgment in selecting him as Britain’s top diplomat in America.
There have been plenty of other challenges. Ahead of its 2024 general election victory, Labour had promised not to raise the main taxes most Britons pay, and many of its most unpopular policies since coming to power have been driven by a drive to find other ways to raise revenue.
Mr. Starmer’s government seemed to be making some progress on the economy when the United States and Israel went to war with Iran in late February, triggering a global energy crisis that has exacerbated Britain’s economic struggles and increased the cost of living for Britons.
Earlier in Mr. Starmer’s premiership, a fierce backlash followed the government’s decision to offer payments to help with the cost of heating in winter to far fewer retirees, a move that affected millions of Britons, including many traditional Labour supporters on relatively low incomes. The chancellor of the Exchequer, Rachel Reeves, announced a plan to increase inheritance taxes on farmers, prompting a furor that eventually led the government to soften its proposals. And plans to change the system of welfare payments had to be abandoned when Labour lawmakers — fearing that disabled people would lose out — rebelled, denting Mr. Starmer’s authority.
On Tuesday, the British pound and the price of government bonds dropped as a rebellion within the governing Labour Party gathered pace to push Mr. Starmer out. The pound fell 0.5 percent to $1.35. Bond yields, which move inversely to prices, jumped. The benchmark 10-year yield climbed to 5.12 percent, up from 5 percent on Monday evening, a sizable move. The yield stayed at that level later in the day after Mr. Starmer said he would get on with governing. But resignations from members of his team continued.
In British politics, the bond market has come to hold huge sway. The premiership of Liz Truss was cut short in 2022 amid convulsions in the bond market after investors balked at her borrowing and spending plans. This time, that market has signaled support for Mr. Starmer and his government’s intentions to bring down debt levels by sticking to ironclad fiscal rules.
But uncertainty over how long Mr. Starmer will retain his position is adding strain to the bond market. The rising yields signal concern that a new political leader might be tempted to borrow more to pay for more spending and investments.
“Because it is unclear who is most likely to succeed Starmer and the policies that they would pursue, investors are likely to attach a risk premium to U.K. assets until the uncertainty is resolved,” Andrew Wishart, an economist at the bank Berenberg, wrote in an note.
He added that members of the Labour party, if given the chance, would be more likely to choose a more left-leaning successor. “Pursuit of a further-left policy agenda risks” measures that could push the economy closer to slower growth, higher interest rates and even an exodus of capital from the British economy, he wrote.
But several economists have noted that while political instability is harmful for British financial assets, the war in the Middle East has a bigger economic impact.
U.K. 10-year government bond yield
The rebellion against Mr. Starmer was set off by his party’s poor performance in local elections across Britain last week. But even before then, the yields on government bonds were rising sharply. These moves were greater than moves in the giant U.S. bond market, as well as in the yields of many of Britain’s European neighbors. The conflict in the Middle East was expected to worsen an already challenging economic and fiscal outlook in Britain.
Inflation in Britain was stubbornly high and just as it was expected to fall, the war in the Middle East sent global energy prices surging. Britain is now facing higher inflation and slower economic growth this year. Investors are now betting that the central bank will raise interest rates instead of cutting them this year, in turn raising borrowing costs for mortgage holders, businesses and the government. All of these lead to a more constrained financial outlook and make it harder for any leader to pursue quick economic growth.
An ouster of Mr. Starmer and his top financial official, Rachel Reeves, would lead to higher yields on British government bonds, known as gilts, and overall interest rates, analysts at Capital Economics concluded in a recent report.
“We doubt a new leadership would be any more successful at boosting medium-term economic growth either, not least because the current fiscal constraints would remain,” the Capital Economics analysts wrote. “For the gilt market, though, the war in Iran matters more.”
With Britain facing a higher inflation outlook and political uncertainty, 10-year bond yields at 5 percent “are here to stay,” said Andrew Goodwin, an economist at Oxford Economics.
Heading into the local elections, many had voiced concerns about Mr. Starmer and Labour.
“Everything just seems so negative,” said Lesley Griffin, 65, a voter in Bexley in South London last week. She said that in the past, she had usually cast her ballot for Labour, and did so in the last general election, but she felt that under the current government, things had worsened nationally and locally.
“I imagine a lot of people are mad at the Labour Party at the moment,” said James Love, 51, a voter in the East London borough of Hackney, after casting his ballot last week.
While many, including Mr. Love, said that ultimately their decision about who to vote for came down to local issues rather than national governance, there was a growing sense of broader discontent.
In Hackney, a borough long-dominated by Labour, the Green Party took overall control of the local council and clinched the mayoral seat.
Recent polling from YouGov, conducted on Monday, found that 50 percent of people surveyed believe that Mr. Starmer should stand down and be replaced by a new Labour prime minister.
A separate favorability tracker from YouGov showed that by the end of last month, some 70 percent of people surveyed felt that Mr. Starmer was doing badly as prime minister. When he first became leader in July 2024, 43 percent disapproved of his performance.
Option 1: Defy calls to resign
Mr. Starmer appeared to face down his critics on Tuesday, daring them to formally challenge him if they had the support to do so. They would need to gather at least 81 Labour lawmakers to coalesce around a potential rival to trigger a leadership contest. It was unclear on Tuesday whether they had enough support to make that happen.
No contender to succeed the prime minister has so far publicly declared themselves to be a challenger, perhaps for fear of being the first to wield the political dagger and looking disloyal in the eyes of party members, who ultimately would decide on Mr. Starmer’s successor. In his remarks to the cabinet on Tuesday, Mr. Starmer warned that a leadership fight would not be good for the country and was already doing economic damage.
Option 2: Set out a timetable to resign
Dozens of Labour Party lawmakers had publicly urged Mr. Starmer to set out a timetable for his resignation to allow a contest to find his successor.
This option would postpone his departure for a few months and might provide some reassurance to financial markets about the immediate future of the government, particularly given the ongoing crisis in the Middle East.
It would effectively make Mr. Starmer a lame duck prime minister, casting him in the role of caretaker until his successor is chosen.
It would also give the party time to organize a contest to succeed him that might include Andy Burnham, the mayor of Greater Manchester, who appears to have political momentum behind him. Mr. Burnham would need to win a seat in Parliament first in a special election, something that was certain to take weeks if not months.
Option 3: Make some kind of concession
There has been speculation that Mr. Starmer could open the way for Mr. Burnham to return to Parliament, by stating clearly he would not block the mayor from running in a special election and would welcome him back into the government as a lawmaker.
Such a move could encourage supporters of Mr. Burnham — who polls suggest is currently the most popular Labour Party politician in Britain — to support Mr. Starmer for a few more months, and might therefore win the prime minister some time.
Option 4: Resign
For now, it appears that Mr. Starmer is defying calls to step down. “The Labour Party has a process for challenging a leader and that has not been triggered,” Mr. Starmer said on Tuesday, according to a statement from his office. “The country expects us to get on with governing. That is what I am doing and what we must do as a cabinet.”
There is always a possibility that he might change his mind, announce his resignation, and let the process for choosing his successor unfold as soon as possible. But even then, he would likely remain in Downing Street until that had taken place.
Andy Burnham
The political momentum is with Andy Burnham, the mayor of Greater Manchester, in northern England, and the only senior Labour figure who seems significantly more popular with voters than Mr. Starmer, according to opinion polls. The snag is that he would have to win a seat in Parliament before mounting a challenge, as only a lawmaker can be Labour leader. That could take weeks, if not much longer, to organize, so a longer timetable for Mr. Starmer to stand aside would suit his ambitions.
Wes Streeting
Wes Streeting, the health secretary, has support on the right of the party and is widely recognized as one of the government’s most effective communicators. But he has been damaged by links to Peter Mandelson, who was fired as Britain’s ambassador to Washington when the depth of his friendship with the convicted sex offender Jeffrey Epstein was revealed. It could be to Mr. Streeting’s advantage to have a swift contest to succeed Mr. Starmer because Mr. Burnham would likely not be able to run.
Angela Rayner
In Mr. Burnham’s absence, Angela Rayner, the former deputy leader, is probably the favored candidate of the left of the party. She resigned last year, however, over a tax imbroglio that is still unresolved.
On Sunday, Ms. Rayner increased the pressure on Mr. Starmer by issuing a statement criticizing a “toxic culture of cronyism” within Labour, warning that the party may be on its “last chance.” She also described a decision by party bosses this year to prevent Mr. Burnham from trying to run in a special election for Parliament as “a mistake.” That could suggest that Ms. Rayner would prefer to support a bid by Mr. Burnham to take over, rather than to challenge Mr. Starmer herself.
