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Stefania Palma and Philip Georgiadis in London

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Starmer set for crunch meeting with Streeting

Sir Keir Starmer is set to hold talks with possible leadership challenger Wes Streeting on Wednesday morning, as the prime minister warned against a return “to the chaos and instability of the past”.

Starmer’s meeting with the health secretary, who would carry the flag for the centre-right of the Labour Party in a leadership contest, marks another moment of potential peril as the wounded prime minister battles to save his premiership.

Streeting has told colleagues he is not prepared to launch a contest to replace Starmer but would stand if the prime minister’s support among Labour MPs collapses. A challenger needs the backing of 81 MPs to stand.

Since Labour’s heavy losses in last week’s English council and devolved elections, Starmer has mounted a rearguard action to stay in Downing Street.

The prime minister has shrugged off calls by more than 90 MPs for him to step down, and the resignation of four ministers.

In what is expected to be another day of political drama in Westminster, Starmer will continue his attempt to stabilise his premiership with the unveiling of dozens of pieces of legislation in the King’s Speech.

It will contain more than 35 bills and draft pieces of legislation, including measures to allow Britain to quickly import EU laws on to the UK statute book to remove trade barriers and to speed up the rollout of green energy.

In comments released ahead of the speech, Starmer said the UK stood at a “pivotal moment” and warned against “chaos and instability of the past”.

Andy Burnham, the Greater Manchester mayor and another leadership rival, travelled to London on Tuesday to meet supporters. Burnham would need to return to Westminster as an MP to compete for the Labour leadership.

Starmer’s team fears that if Streeting were to launch a leadership bid — before Burnham can stand — then energy secretary Ed Miliband would join the fray as the standard-bearer for Labour’s “soft-left”.

The crisis in Downing Street has sparked turmoil in the gilt market, with UK government borrowing costs on Tuesday rising to the highest level since 2008.

Bond investors are fearful a successor to Starmer would shift to the left, driving up spending and government borrowing costs.

The pound was little changed at $1.3546.

FT Reporters

Starmer warns against return to ‘chaos and instability’

© Getty Images

Sir Keir Starmer said people in the UK “expect the government to get on with the job” as the government prepared to set out its agenda in the King’s Speech.

“Britain stands at a pivotal moment: to press ahead with a plan to build a stronger, fairer country or turn back to the chaos and instability of the past,” the prime minister said.

George Parker, Jim Pickard, Anna Gross and Rachel Rees in London

Starmer government to set out agenda in King’s Speech

The King is seated in a throne and is wearing a crown as he reads the speech
King Charles III during the state opening of parliament in 2024 © AP

Wednesday could see a temporary lull in hostilities when King Charles officially opens the second parliamentary session of what Starmer hopes will be a full five-year term of government.

There were discussions between Buckingham Palace and Downing Street about the tense political backdrop, according to people briefed on the talks, but no suggestion that the monarch would postpone the event.

The King’s Speech will contain more than 35 bills and draft pieces of legislation, including measures to allow Britain to quickly import EU laws on to the UK statute book to remove trade barriers, and to speed up the rollout of green energy.

There will also be measures to improve special-needs provision in schools, enact reforms to the NHS, and to enable the nationalisation of British Steel.

Ian Smith and Emily Herbert in London

Who do gilt investors want to lead Britain?

Andy Burnham represents the biggest threat to the gilt market among the frontrunners to replace Sir Keir Starmer as Labour leader, with Wes Streeting the least risky option, according to UK government bond investors.

Starmer’s increasingly precarious position helped drive the UK’s 10-year borrowing costs to their highest level since 2008 on Tuesday, as investors readied for a bruising leadership contest to test a market already struggling with surging oil prices. 

“I suspect the new leadership will attempt to calm down markets with a few words,” said Mizuho’s Jordan Rochester. “But the party is shifting to the left and the market will price that in first.”  

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