Labour leadership contest looms as Starmer faces internal revolt and market turbulence
With over 80 MPs calling for resignation and senior figures backing Andy Burnham’s bid to return to Parliament, the stability of Keir Starmer’s administration is under severe strain.
British Prime Minister Keir Starmer is confronting intensifying pressure from within his own party following a disastrous local election result for the Labour Party. The turmoil is compounded by controversy surrounding the appointment of Jeffrey Epstein associate Peter Mandelson as ambassador to Washington and growing frustration over the pace of domestic policy implementation. Despite these challenges, Starmer has refused to step down, though more than 80 MPs have publicly urged his resignation and four junior ministers have already resigned their posts.
Concurrently, Greater Manchester Mayor Andy Burnham is emerging as the primary potential challenger to Starmer’s leadership. To launch a formal leadership bid, Burnham must first secure a seat in the House of Commons, a prerequisite under Labour rules. He intends to contest a by-election in Makerfield, northwest England, after Labour lawmaker Josh Simons resigned his seat on Thursday to facilitate the contest.
Support for Burnham’s bid has gained significant traction among senior party figures. Wes Streeting, the former health secretary who resigned on Thursday, publicly endorsed the mayor on Friday, stating on X that Burnham represents the best chance of electoral success. Streeting argued that merit should override factional interests, describing Burnham as one of the party’s essential players.
Labour deputy leader Lucy Powell also confirmed her support for Burnham’s return to Parliament. Speaking to The Guardian, Powell stated there would be “absolutely no attempt to stop” his efforts, signalling a shift in the party’s internal dynamics. Additionally, Joanne Thomas, General Secretary of the Union of Shop, Distributive and Allied Workers, confirmed that the union has formally endorsed Burnham’s bid.
Burnham’s path to 10 Downing Street remains subject to procedural hurdles. The Labour National Executive Committee (NEC) must approve his candidacy for the Makerfield by-election, with a decision expected in the coming days. Although the NEC previously blocked similar bids, multiple MPs expect approval this time. If elected, Burnham would need the support of 81 Labour MPs to trigger a leadership challenge.
Market reactions to the political instability have been swift. The sterling has slid to a five-week low as investors react negatively to the prospect of a Burnham premiership, citing concerns over potential fiscal loosening. Meanwhile, public sentiment appears to align with the internal unrest, with a recent YouGov survey indicating that 69% of Britons hold an unfavourable view of Starmer.
Other potential contenders are also positioning themselves. Deputy leader Angela Rayner cleared a significant hurdle on Thursday when tax authorities confirmed she was cleared regarding her tax affairs, removing a previous obstacle to a leadership bid. As the Makerfield by-election approaches, Reform UK leader Nigel Farage has pledged to “throw absolutely everything” at the contest, further complicating the political landscape.
