Rayner says she has been cleared by HMRC, paving the way for a potential Labour leadership challenge.

Former United Kingdom Deputy Prime Minister Angela Rayner says she has been cleared by tax authorities of deliberate wrongdoing or carelessness over her tax affairs, paving the way for a potential leadership bid as Prime Minister Keir Starmer’s grip on power unravels.

Starmer, who led his Labour Party to victory in the 2024 general election, is fighting to save his job after disastrous local and regional polls last week.

Four junior ministers have resigned, and more than 80 MPs have urged him to quit, but he has pledged to cling on.

Although no one has so far launched a formal leadership challenge, UK media reported that Health Minister Wes Streeting was preparing to resign on Thursday to run for the top job.

The prospect of a challenge by Rayner also grew as she announced that UK tax authorities had “cleared” her of deliberate wrongdoing in a tax affair, opening the way for her to compete in a potential leadership contest.

“I have been exonerated by HMRC of the accusation that I deliberately sought to avoid tax,” Rayner said in a statement on X on Thursday. “I have always sought to act with integrity, and I believe politicians should be held to high standards – that is why I resigned from the government and cooperated fully with HMRC.”

Rayner told The Guardian she was ready to “play my part” in any leadership election if Streeting were to trigger a contest.

Pressure for Starmer to step aside or face a leadership challenge has intensified since the Labour Party suffered heavy losses in local and regional elections last week, highlighting voters’ frustrations with the current Labour government.

Starmer has pledged to remain in office, warning lawmakers that any leadership contest would plunge the government into “chaos”.  Under Labour Party rules, any potential challenger to the prime minister would have to have the backing of 81 of the party’s 403 members in the House of Commons; more than that number have publicly called on Starmer to quit in recent days.

Streeting comes from the centrist wing of the Labour Party, as does Starmer. Rayner is popular among Labour’s left wing, calling on the party to do more to boost the minimum wage and raise taxes on the rich.

But other potential candidates may enter any race for the leadership. Greater Manchester Mayor Andy Burnham has been widely discussed as a potential candidate, though he would have to find a way back into Parliament before he could run. Allies have suggested a sitting member of the House of Commons could resign to make way for Burnham to run in a special election.