UK MPs turn on PM Starmer, analysts say he’s unlikely to last the year
British Prime Minister Sir Keir Starmer attends the opening session on the first day of the Labor Party conference at ACC Liverpool on September 28, 2025 in Liverpool, England.
Dan Kitwood | Getty Images News | Getty Images
British Prime Minister Keir Starmer’s leadership is hanging by a thread as a growing number of lawmakers from his own party call on the Labor leader to resign.
The move against Starmer comes after the ruling Labor Party performed poorly in local elections last week, losing votes to parties on both the left and right of the political spectrum.
CNBC has a quick guide to what’s happening in the UK and what might happen next
What’s going on?
Starmer’s premiership is on a knife edge this week, with a significant number of Labor MPs openly rebelling and calling for the Prime Minister to resign immediately or set a timetable for his departure.
As of Monday evening, 77 Labor MPs want Starmer to resignThe most prominent voice urging the Prime Minister to stand down was Home Affairs Minister Shabana Mahmood.
The first ministerial resignation came on Tuesday with the departure of Miatta Fahnbulleh, deputy minister in the department for housing and communities, who called on Starmer to “do the right thing for the country and the Party and set a timetable for an orderly transition”.
“The public doesn’t believe you can lead this change, and neither do I.” shared on x.
In a speech designed to boost support among his Labor colleagues on Monday, Starmer took responsibility for the party’s disastrous performance in last week’s local council elections. The result was seen as a litmus test of national public support for Labor, and he admitted he had “doubts”.
He also vowed to “confront the big challenges” facing the country and focus on national security, immigration and closer ties with Europe. But the speech did not impress party insiders and several deputy ministers resigned later on Monday.
“The attempt to quell the rebellion against Starmer’s leadership has failed,” Eurasia Group analysts said.
“While he may remain in Downing Street for a few more months, he is still fighting for his political life after his make-or-break final speech earlier on Monday did not include enough new policies to satisfy many Labor MPs.”
Jordan Rochester, Mizuho’s head of EMEA fixed income, currency and commodity strategy, said on Tuesday that the momentum was not on Starmer’s side.
“For many people the writing is on the wall at this stage, it’s a matter of how quickly the exit happens… [Nonetheless] If Starmer leaves, he will make history. “No sitting Labor Prime Minister has ever faced a leadership challenge or been dismissed by his party,” he said.
In a sign of markets’ uneasiness with the unstable political situation, UK government borrowing costs rose to their highest level since 2008 on Tuesday morning.
How did we get here?
There have been voices of discontent among Labor MPs and large sections of the electorate for some time. Of particular concern is the government’s apparent failure to control illegal immigration, particularly by boats crossing the English Channel, and unpopular efforts to cut welfare spending.
A series of policy U-turns led to the Labor government being described as weak and indecisive and indebted to influential backbench MPs. This damaged its credibility with investors.
British Prime Minister Keir Starmer and Chancellor of the Exchequer Rachel Reeves on 23 June 2025.
Jacob the King | Pool | Afp | Getty Images
The catalyst for Starmer’s latest political crisis was Labour’s disastrous performance in last week’s local council elections, which saw voters flock to both the right-wing Reform Party UK and the left-wing Greens. In total, Labor lost control of more than 30 councils across England, with around 1,500 councilors defeated.
What happens next?
Starmer held an intense meeting with his government colleagues on Tuesday morning, at the same time his office issued a statement insisting the prime minister had no intention of resigning.
“The Labor Party has a process to challenge a leader and this has not yet been triggered,” the statement said.
The statement continued: “The country expects us to continue to govern. That is what I have done and what we must do as a Cabinet. The past 48 hours have been destabilizing for the government and this has a real economic cost for our country and families.”
Despite Starmer’s challenge, the leadership team was reportedly divided with both the BBC and the Financial Times on what the Prime Minister should do next. reporting There were mixed messages from cabinet ministers on Monday night; Some urged Starmer to continue the fight, while others said he should consider leaving office. The Telegraph newspaper reported on Tuesday that six of the 22 cabinet ministers are expected to tell him to resign.
Political analysts say Starmer’s time as prime minister is over, but when and how he left is still in question. Eurasia Group on Monday evening raised the likelihood of Starmer being sacked this year to 80%, from the previous 65%. Conversely, Starmer now has only a 20% chance of remaining Prime Minister.
“The most likely scenario is that MPs will push for a leadership election by September (35% probability); there is a 25% chance of an orderly transition in which Starmer will agree to stand down, and a 20% probability of an emergency leadership election,” Eurasia Group analysts led by Mujtaba Rahman wrote in an emailed analysis on Monday. he said.
Shadow Chancellor Rachel Reeves, Labor leader Keir Starmer and deputy leader Angela Rayner at an event to launch Labor’s election promises at The Backstage Center on May 16, 2024 in Purfleet, United Kingdom.
Leon Neal | Getty Images News | Getty Images
The British are putting pressure On Tuesday, he focused on Starmer’s failure to persuade his critics to remain in office and predicted his imminent decline. The potential name to replace him is in the focus of both the media and the markets.
Potential leadership challengers include Manchester Mayor Andy Burnham; However, he must be an MP to take part in any leadership race. Starmer’s former deputy Angela Rayner and current Health Secretary Wes Streeting are also seen as possible candidates. However, none of them have yet made a move to challenge Starmer.
Economists warn that any candidate could loosen the budget once in office, reversing efforts to reduce spending and debt. This could send shockwaves through markets and spook investors already worried about Britain’s struggle to rein in inflation and boost growth.
The interest rate on Britain’s 10- and 30-year borrowing costs rose to 5% and 5.67% respectively on Monday, reflecting market concerns that a new Labor leader “could face pressure to ease fiscal rules and increase gilt issuance,” Deutsche Bank strategists said on Tuesday.
They added in emailed comments that Tuesday’s cabinet meeting “could be a big day in determining Starmer’s future.”
