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(Sharecast News) - UK Health Secretary Wes Streeting was reportedly set to resign on Thursday in order to launch a leadership challenge against embattled Prime Minister Keir Starmer.
Streeting, seen as the unpopular Starmer's main rival for the job, held a 16-minute meeting in Downing Street with the leader on Wednesday morning before emerging grim-faced and saying nothing to the waiting media outside.
Local media were citing "allies" - Westminster code for aides to Streeting or the minister himself - as saying he would step down tomorrow and start canvassing for the 81 MPs he needs to back any leadership campaign.
Starmer on Tuesday refused to resign despite growing calls from within his own ruling Labour Party to step aside - effectively laying down a challenge to potential rivals to unseat him.
After a hammering at local elections last week to compound months of policy failures and plunging popularity, at least 80 lawmakers and ministers said he should go.
However, at Tuesday's weekly Cabinet meeting in Downing Street on Tuesday, Starmer remained defiant, saying he took responsibility for the election results and "delivering the change we promised".
The news saw a rise in gilt yields and a falling pound on the growing political uncertainty as traders feared a new administration could relax the government's self-imposed fiscal rules and lift public spending. The 30-year bond yield was up 13 basis points at 5.803%, the highest level since 1998.
"The past 48 hours have been destabilising for government and that has a real economic cost for our country and for families," Starmer said in a statement released by Downing Street.
"The Labour Party has a process for challenging a leader and that has not been triggered. The country expects us to get on with governing. That is what I am doing and what we must do as a Cabinet."
Four junior ministers had resigned from the government: Communities minister Miatta Fahnbulleh, safeguarding minister Jess Phillips, Alex Davies-Jones, the minister for victims and Zubir Ahmed, health minister.
More than 100 of the PM's allies signed a letter late on Tuesday saying: "This is no time for a leadership contest."
"Last week we had a devastatingly tough set of election results. It shows we have a hard job ahead to win back trust from the electorate. That job needs to start today - with all of us working together to deliver the change the country needs. We must focus on that."
Reporting by Frank Prenesti for Sharecast.com