Even by the dire standards of modern British politics, Keir Starmer’s new Labour government has stumbled out of the gate with a series of significant challenges and controversies.
After little more than five months in office, Starmer’s administration is already facing sharp criticism for its handling of the economy and an emerging political scandal that threatens to undermine its credibility.
One of the most immediate issues confronting the government is the state of the UK economy.
Under the stewardship of Chancellor Rachel Reeves, the country appears to be teetering on the brink of recession. The Autumn Budget, unveiled by Reeves, has been widely criticised for its perceived lack of foresight and economic rigour.
This comes against the backdrop of worrying economic data: the Office for National Statistics (ONS) reported zero GDP growth between July and September, a stark revision from the previously estimated 0.1% growth. With the private sector already bracing for tough times, the Confederation of British Industry’s (CBI) latest survey warns of a sharp decline in employment in early 2025. This grim forecast signals turbulent times ahead for businesses and workers alike.
The Labour Party has long struggled with public perceptions of its economic management, and these latest developments play into familiar criticisms. While Labour governments have often been accused of lacking fiscal discipline, the magnitude of the current economic malaise so early in Starmer’s tenure has raised alarm bells even among party loyalists.
Critics argue that the government’s policy missteps could erode confidence in Labour’s ability to steer the economy effectively, potentially undoing years of painstaking efforts to rebuild the party’s economic credibility.
However, it is not just economic woes that are dominating headlines.
A burgeoning scandal involving Tulip Siddiq, the newly appointed Economic Secretary to the Treasury, has cast a fresh shadow over Starmer’s government.
Siddiq, who is tasked with combating corruption in the UK’s financial markets, now finds herself at the centre of allegations of impropriety linked to her family’s political connections in Bangladesh.
The controversy stems from Siddiq’s alleged involvement in brokering a deal between her aunt, Sheikh Hasina, the recently deposed former prime minister of Bangladesh, and Russia’s Atomstroyexport, a subsidiary of Rosatom, for the construction of the Rooppur nuclear power plant.
The project, one of the most ambitious infrastructure undertakings in Bangladesh’s history, carries an estimated price tag of $12 billion. While Rosatom is not currently subject to Western sanctions resulting from Russia’s brutal invasion of Ukraine, its subsidiary Atomstroyexport is.
Allegations of corruption surrounding the deal have been raised in the Bangladeshi courts, with opposition politician Bobby Hajjaj claiming that the plant’s price was artificially inflated to funnel $5 billion to Sheikh Hasina and her family. These accusations have placed Siddiq in a deeply uncomfortable position, particularly as her current role in the Treasury involves ensuring integrity within financial systems.
Adding to the intrigue is a photograph of Tulip Siddiq, Sheikh Hasina, and Russian President Vladimir Putin.
Siddiq has defended the photograph, explaining that she posed for it only after Putin requested a photograph with Sheikh Hasina and her family.
Her explanation is indeed highly plausible: given Putin’s background as a former KGB officer, adept at leveraging compromising situations, he would fully appreciate the potential value of such a highly compromising photograph.
The image will remain as an indelible symbol of Siddiq’s entanglement in a politically fraught affair.
The Cabinet Office’s propriety and ethics team has reportedly interviewed Siddiq regarding the allegations, further highlighting the gravity of the situation. Compounding her troubles, Siddiq has faced scrutiny over her personal financial arrangements.
In August 2024, it emerged that she was living in a house owned by Abdul Karim, a businessman with close ties to the Awami League, Sheikh Hasina’s political party.
While no impropriety has been suggested in this arrangement, Siddiq failed to declare rental income from her own property, which she had vacated, this being a requirement for Members of Parliament. The House of Commons standards watchdog accepted her explanation that this was an “administrative oversight,” but the incident has nonetheless fueled criticism of her judgment and transparency.
The combination of economic mismanagement and political scandal has placed Starmer’s government under intense pressure.
For a leader who came to power promising competence and ethical governance, these early stumbles risk tarnishing his administration’s reputation. The economic challenges alone are formidable, with the spectre of recession threatening to undermine Labour’s legislative agenda and erode public trust. Meanwhile, the Siddiq scandal has exposed vulnerabilities within the party’s vetting processes and raised questions about the judgment of its senior figures.
Starmer’s critics argue that these issues reflect deeper systemic problems within the Labour Party. The party’s economic strategy has been criticised as overly cautious and lacking in vision, while its handling of the Siddiq affair has been described as reactive rather than proactive.
Supporters of the government, however, contend that these challenges are symptomatic of broader global and domestic pressures, from the lingering effects of the COVID-19 pandemic to geopolitical instability.
Regardless of the underlying causes, the onus is now on Starmer to steady the ship.
The Prime Minister must address the economic crisis with a clear and coherent strategy, demonstrating that Labour is capable of delivering sustainable growth and stability. At the same time, he must ensure that the Siddiq scandal is thoroughly investigated and resolved, signaling a zero-tolerance approach to ethical lapses within his administration.
In politics, early setbacks are not uncommon, but their long-term impact depends on how they are managed. For Starmer and his government, the coming months will be crucial in determining whether these initial missteps can be overcome or whether they will mark the beginning of a downward spiral.
The stakes are high, not just for Labour, but for a country in desperate need of competent and credible leadership.
