Published by Global Banking & Finance Review®
Posted on February 9, 2026
5 min readLast updated: February 9, 2026
Add as preferred source on GoogleKeir Starmer resists resignation calls over Epstein scandal ties, facing political pressure and team resignations while focusing on economic issues.
By Elizabeth Piper, Alistair Smout and Sam Tabahriti
LONDON, Feb 9 (Reuters) - British Prime Minister Keir Starmer refused on Monday to heed calls to quit, even by the leader of his party in Scotland, after a second aide resigned from a team in crisis over the appointment of Peter Mandelson as ambassador to Washington.
Under pressure over the appointment of a man whose close ties to the late U.S. sex offender Jeffrey Epstein have come into full focus, Starmer has attempted to change the narrative.
But a demand from Anas Sarwar, leader of the Scottish Labour Party, for him to quit and the departure of a second senior aide in as many days did little to stop the questions over his judgment and ability to govern.
The resignation of communications chief Tim Allan followed the exit of Starmer's closest aide, Morgan McSweeney, who said he took responsibility for advising on the appointment of Mandelson to Britain's top diplomatic role in the United States.
Earlier on Monday, the British leader sought to raise spirits and encourage unity when he addressed staff at his Downing Street office, and he later received messages of support from his top ministers and some potential leadership rivals.
"We must prove that politics can be a force for good," he told them, praising McSweeney as "a friend" who helped change the Labour Party and win the 2024 national election with one of the largest parliamentary majorities in modern British history.
"I believe it can. I believe it is. We go forward from here. We go with confidence as we continue changing the country."
But Sarwar, speaking in Scotland where Labour has seen its support slump since the 2024 election, said it was with a heavy heart that he had to defend Scotland and call for a change of leader in the UK capital London.
"The distraction needs to end and the leadership in Downing Street has to change," he told a press conference.
In response, a Downing Street spokesperson said Starmer had "a clear five-year mandate from the British people to deliver change, and that is what he will do".
STARMER STRUGGLES TO CHANGE THE NARRATIVE
With his statement, Sarwar became the most senior Labour figure to call for Starmer's resignation, and did little to quell a febrile mood in parliament in London's Westminster.
Government borrowing costs rose, reflecting investors' concerns that a more left-wing Labour leader, who was willing to borrow and spend more, could take over. The climb in yields, along with the value of the pound against the euro, later eased after the potential successors came out in Starmer's support.
With Starmer losing his fourth director of communications, his record in government is under scrutiny, including the gaffes and policy U-turns that have tainted his almost two years in power.
"It's painful," said one Labour lawmaker on condition of anonymity. "It's like watching a fatal car crash in slow motion."
But Starmer received a show of support from his deputy, David Lammy, finance minister Rachel Reeves and foreign minister Yvette Cooper, among others. Angela Rayner, his former deputy who is seen as a leading leadership candidate, offered him her "full support".
"I urge all my colleagues to come together, remember our values and put them into practice as a team. The Prime Minister has my full support in leading us to that end," she said on X.
With McSweeney's departure on Sunday, Starmer had hoped to reset the narrative and attempt to return to an agenda he has so far failed to keep any focus on - tackling the cost-of-living crisis and boosting the British economy.
The leader of the opposition Conservative Party, Kemi Badenoch, accused Starmer of being unable to run his government.
"He's like a plastic bag blowing in the wind. We need him to get a grip and if he can't do it then someone else in the Labour Party needs to do that, or they should have an election," she told Sky News.
PRIME MINISTER TO MEET LAWMAKERS
The new scandal over Mandelson, who was sacked as ambassador to the United States in September, came after files released by the U.S. Justice Department last month included emails suggesting Mandelson had leaked discussions on possible UK asset sales and tax changes to Epstein during the financial crash.
Mandelson has not commented publicly on allegations he leaked documents, and did not respond to messages seeking comment.
Starmer will meet Labour lawmakers later on Monday and try to ease anger over the handling of the appointment and quieten those voices saying he should quit.
Mandelson is now under police investigation for alleged misconduct in office.
Starmer has defended his own actions, accusing Mandelson of creating a "litany of deceit" about his Epstein ties and promising to release documents on how he was appointed.
(Reporting by Elizabeth Piper, Alistair Smout, Sam Tabahriti and Catarina Demony; Additional reporting by Andrew MacAskill and William Schomberg; editing by William James and Ros Russell)
Financial stability is a condition where the financial system operates effectively, allowing for the smooth functioning of financial markets and institutions without significant disruptions.
Economic growth is the increase in the production of goods and services in an economy over a period of time, typically measured by the rise in Gross Domestic Product (GDP).
The UK economy refers to the economic system of the United Kingdom, characterized by a diverse range of industries, including finance, manufacturing, and services.
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