• Wes Streeting resignation intensifies pressure on PM Starmer.
• Labour lawmakers increasingly call for Starmer resignation.
• Starmer vows to fight any leadership challenge despite rebellion.

Labour’s Wes Streeting resigned as health minister on Thursday to call for a leadership contest to oust Keir Starmer, accusing the British prime minister of overseeing political drift and forcing others to take the blame for his government’s failings.

Disastrous results for the governing Labour Party in last week’s local elections have plunged Britain into its latest crisis, just under two years after Starmer won a large majority on a vow to bring stability and end a decade of political chaos.

After days of calls by a growing number of Labour lawmakers for Starmer to either resign or set out a timetable for his departure, Streeting was the first senior minister to break cover, saying he was standing down because “it is now clear you will not lead the Labour Party into the next general election”.

But he did not trigger a formal contest.

“It is now clear … that Labour MPs (members of parliament) and Labour (trade) unions want the debate about what comes next to be a battle of ideas, not of personalities or petty factionalism,” he wrote in his resignation letter.

“It needs to be broad, and it needs the best possible field of candidates.”

His announcement fell short of forcing the launch of a formal leadership contest but piles the pressure on the British leader who has so far weathered a drip feed of demands for him to step down.

Streeting’s criticism was stinging.

“Where we need vision, we have a vacuum. Where we need direction, we have drift,” Streeting said, criticising Starmer’s speech on Monday which the British leader had hoped would silence the resignation demands.

“Leaders take responsibility, but too often that has meant other people falling on their swords.”

A source close to Streeting said the former health minister had the numbers to mount a formal challenge to Starmer but had decided not to trigger an immediate contest because he felt setting out an orderly timetable was the right way forward.

Starmer has repeatedly said he would battle to keep his job, and sources close to the leader say he is determined to fight any contest, which could see him challenged by Streeting and also senior ministers on the left of the party.

Sterling edged lower after Streeting’s resignation.

“It moves us one step closer to a Labour leadership challenge. How many steps are between here and there that’s still uncertain,” said Nick Rees, head of macro research, Monex Europe, London.

Potential candidates

Earlier on Thursday, Starmer’s former deputy, Angela Rayner, announced she had been cleared of deliberate wrongdoing over her tax affairs, an impediment to any leadership contest, but she would not say whether she wanted to launch a formal bid.

Other potential candidates from the so-called “soft left” of the party — who favour more state involvement in key industries and are pro workers’ rights — include Greater Manchester mayor Andy Burnham and Ed Miliband, the minister for energy security and net zero.

Burnham does not currently have the necessary seat in parliament to mount a challenge and even if a lawmaker agreed to stand down to make space for him, the process could take weeks, or maybe months, which could discount him from any race.

Another potential candidate is armed forces minister Al Carns, a relatively unknown ex-Royal Marine seen by some in Labour as a new face that could freshen up the party.

While potential candidates try to garner backers, Starmer is not without his supporters.

The 63-year-old former lawyer has adopted a “business as usual” approach and on Thursday his finance minister, Rachel Reeves, warned lawmakers against “plunging the country into chaos” at a time when Britain’s anaemic economy was turning a corner. The economy grew unexpectedly in March.

Boss says businesses being hit by turmoil

While the number of calls for him to resign ebbed on Wednesday, when his government turned to King Charles to set out its agenda for a new parliamentary term, Thursday was yet another day of peril for Starmer.

The prospect of another leadership race to choose what would be Britain’s seventh prime minister in around 10 years has angered business leaders who warn it will deter investment – something the Labour government has said must improve to turn around the nation’s fortunes.

The bout of political instability has pushed borrowing costs higher, with some investors nervous over the possible election of a more left-wing, tax-and-spend Labour prime minister.

A poll by Survation published this week of Labour members found that a left-wing candidate would most likely win any leadership contest if the prime minister resigned.

The boss of Aviva, one of Britain’s biggest financial companies, complained that businesses were being hurt by the turmoil.

“There have been too many changes of government strategy, leadership, just in my six years of being CEO,” CEO Amanda Blanc told Reuters. “And I think that is harmful to a major economy such as the UK and how we are perceived abroad.”