Has the UK become ungovernable?

Here’s a quick quiz question: what country has the fastest-growing economy in the G7? The answer is, the UK. It should be surprising, then, that the country is in the process of defenestrating its Prime Minister less than two years after Keir Starmer won a landslide majority that should be a rock-solid pillar of political stability. In fact, the Labour party is pulling him down as viciously as any power struggle in parliamentary history. Last Wednesday, the day broke with Mr Starmer’s future on the line. On the Thames Embankment, I spied the biographer and prime ministerial expert Anthony Seldon marching with determination towards Parliament and its TV studios. This could have only meant one thing: at a turning point, Mr Seldon was there to observe its twists and turns. Writing later in the week, Mr Seldon observed that today’s crisis is a cumulative failure across the political spectrum. It begs the question if the UK is governable with its current institutional set-up. It is remarkable that Mr Starmer came to office in 2024 with a saviour’s mandate. But while his slogan was “country before party”, he immediately resorted to a partisan brand of politics . And behind the facade of a majority, Labour eventually began running out of steam – as did the Conservatives, the primary opposition force in Parliament. Today, it’s safe to say that the century-long two-party system is no longer functioning. This is having an impact on the national economy. While on the one hand, the UK can boast of having one of the fastest-growing major economies, there is also a crisis in the debt markets. Contradictions like this can be spotted in almost all British institutions. It is quite remarkable that it is still less than four years since Boris Johnson announced he would leave Downing Street. And should this summer usher in the seventh prime minister in a decade, no one would be surprised. What inaugurated this era of wasted leadership will be marked next month, with the 10-year anniversary of the Brexit vote to leave the EU. The most fundamental consequence of that vote came not in London but in Brussels. It’s said that the EU has sought to ensure that Brexit would leave the UK demonstrably worse off . European economies might well be stagnating, but the bloc is determined to give its erstwhile member the cold shoulder. Right now, it looks like the EU has been remarkably successful in resisting the UK’s assumption that it could ensure an orderly withdrawal from the bloc. Mr Starmer and even more so Wes Streeting – the recently departed health secretary who wants to challenge his former boss for the top job – have reopened the Brexit chasm in UK politics by vowing to embrace the EU institutionally in the next phase of the Labour government. This looks like a needless distraction when the governing party could, at last, be selling a turnaround in the UK’s fortunes. For example, the Department of Health and Social Care that Mr Streeting used to lead was lavished with funds from higher taxes to address inefficiencies and bottlenecks in treatment delivery. This has begun to produce results following setbacks caused by more than a decade of budgetary austerity and then the Covid-19 pandemic. Mr Streeting even delayed his resignation until the day he could announce the cutting of waiting times for operations. And yet were he to become prime minister, he is likely to push for the UK to rejoin the EU . There have been breakthroughs in other areas, too. After years of trouble from the influx of boats carrying migrants, the UK is close to achieving net-zero immigration. The arrests of criminals involved in people smuggling are up by more than half. The UK has a toehold in the development of AI that most countries would envy. Its AI Safety Institute has accessed Anthropic’s Mythos – recently described by the historian Niall Ferguson as the equivalent of being first to AI’s atomic bomb – to provide an assessment of its powers. The country has also successfully tapped its location to adopt renewable energy capabilities that have attracted broad investment and rapid expansion. However, the government has also scored some own goals. By spurning the last investment opportunities in the North Sea’s fossil fuels , it has undermined the strategic advantages of its location. The high cost of energy is cross-cutting against the widespread adoption of technologies that it could be maximising. Under Labour, the combination of high energy prices with high taxes is hollowing out the real economy at an alarming rate. The loss of its wealthiest on the rich list, including to the UAE , is a significant drain on economic transformation. Instead of doubling down on its strengths, the UK is strategically self-defeating its own most dynamic businesses. At a time of war, the Starmer administration has failed for months to set a “defence investment plan” that could ally the working class with defence and security strategists to boost national resilience. The picture again is mixed but dominated by weaknesses that emanate straight from a government that doesn’t know how to use its powers. It’s little wonder, then, that the system cannot regain the confidence of the voters, with the failures now being shared by the two traditional parties of power. All of this suggests that months of leadership struggles could lie ahead. And as the costs of the Iran war quickly bear down on the public finances, the drumbeat will be that the country is poorer, its government taxes too much and borrows at levels that makes the markets queasy about its politics. It is all of Labour that carries that responsibility – not the just the politician it picks as its new saviour.