Labour MPs agree that Sir Keir Starmer has suffered his worst week yet in Downing Street, following his admission that he appointed Lord Peter Mandelson as UK ambassador to the US despite knowing about the peer’s long-standing friendship with child sex offender Jeffrey Epstein.
The scandal has fuelled questions about the prime minister’s ability to cling on in No 10 and sent briefings by supporters of potential leadership contenders into overdrive.
But backers of the two frontrunners face questions about their viability. Former deputy Labour leader Angela Rayner has still not resolved her tax dispute with HMRC, while health secretary Wes Streeting’s own ties to Mandelson could prove an embarrassment and dent his prospects.
One person close to Streeting, viewed as a leading candidate on the Blairite wing of the party, accused his opponents of spreading false stories in a bid to amplify his friendship with Mandelson, adding: “There had been no contact since Mandelson was sacked [as ambassador] last September.”
The person added that Streeting was not invited to Mandelson’s wedding in 2023, unlike Starmer and a host of other prominent party figures.
Those backing Streeting have also pointed out that the health secretary disowned Mandelson last year while Starmer was still backing him as US ambassador. Streeting said he was “completely disgusted” by messages between Mandelson and Epstein released last September and refused to say he should keep his job. Starmer sacked Mandelson a few hours later.
Streeting has admitted deleting photographs with Mandelson from social media, although he told LBC this was to protect other people pictured from being caught up in the scandal. He added: “I’ve left plenty of other posts up there of mine praising Peter Mandelson because I believe in transparency.”
In a sign of suspicion between the camps, some Streeting allies believe Rayner’s team are deliberately highlighting his connections to Mandelson. This is denied by Rayner’s allies. They point out, however, that Rayner and Mandelson never got on and that she faced lobbying from him to water down Labour’s Employment Rights Act.
Rayner’s own path to Downing Street is not without potential barriers, however. Some Labour MPs believe her prospects could be stymied by her ongoing dispute with HMRC over her tax affairs, a scandal that triggered her resignation from government last September.
The former deputy prime minister, who admitted she had incorrectly paid a lower rate of stamp duty on the purchase of an £800,000 flat, has not yet received a final determination from HMRC, according to people familiar with the situation.
One MP on the soft left said “Angela still needs to get the HMRC stuff sorted out” before she could credibly run as Labour leader. Allies insist she is co-operating with the tax authorities and will pay the eventual settlement, financed in part by extra work such as giving speeches and writing a book.
However, her associates say she is not agitating for the leadership and would only make a decision to run if a contest arose.
Recent efforts to raise £50,000 were to pay for staffing costs to assist in her role as a high-profile backbencher rather than a campaign war chest, they insist.
On Wednesday Rayner forced Starmer to make concessions over the release of documents relating to Mandelson’s appointment as ambassador simply because “she thought it was the right thing to do”, rather than as a leadership manoeuvre.
Both Streeting and Rayner’s allies insist they will not be the first to move. This has left some of their supporters frustrated as they cast around for something to trigger Starmer’s departure. “Keir might just decide to call it a day — he can see it’s not working,” said an MP who backs Streeting.
Another backing Rayner said ministers may resort to a mass resignation such as was launched against Jeremy Corbyn in 2016 — before noting that it ended in failure.
However, some MPs believe that while the mood of the party is “mutinous”, it does not make sense to precipitate a leadership election until the disclosure around Mandelson’s appointment and vetting is completed, in case material is unearthed that has implications for potential candidates.
Others believe support for both Rayner and Streeting is exaggerated. “The market for Angela Rayner is overpriced . . . Wes has his adversaries as well,” said one senior MP, adding that nobody had support “even close” to the threshold of gaining 80 MPs’ signatures to spark a leadership race.
A poll of party members by LabourList suggested Starmer would beat Streeting in a leadership election by a margin of 53 per cent to 37 per cent but lose to Rayner by 48 per cent to 37 per cent.
The absence of a direct challenge to Starmer may widen the field for other contenders to emerge. Energy secretary Ed Miliband is spoken about in soft-left circles, while home secretary Shabana Mahmood has been floated on the right of the party.
One union leader told the FT that defence secretary John Healey had the qualities to become the next Labour leader as an “unflappable and strategic” figure not too closely associated with one particular wing.
Defence minister Al Carns, a former Royal Marines officer first elected in 2024, has also been mooted by some MPs as a wild-card option.
Meanwhile a candle is still held for Greater Manchester mayor Andy Burnham by some on the soft left, despite Labour’s ruling body blocking him from potentially returning to parliament in the Gorton and Denton by-election this month. He would beat Starmer 53 per cent to 37 per cent among party members, the LabourList poll suggested.
The possibility of a Burnham loyalist taking over as a caretaker prime minister who would later allow him to stand in a by-election has been floated — but rejected as a “psychodrama” option that would be too much for the British public to handle.
For now, Starmer staggers on, helped by the lack of consensus over who should come next.
There are parallels with former prime minister Harold Wilson, according to Tim Bale, professor of politics at Queen Mary University of London.
“There were a whole bunch of people who wanted to take over, but insufficient agreement among the Parliamentary Labour Party about who they wanted — and that helped keep Wilson in office . . . Starmer may be safer than many people think.”