Relations between Britain and Israel have plunged to a new low after the Israeli government ordered the closure of the UK consulate in East Jerusalem in retaliation for sweeping new British measures targeting Israeli settlements in the occupied West Bank.
Israel announced a series of counter-measures within hours of Foreign Secretary Ed Miliband unveiling what he described as a new approach to the Israeli-Palestinian conflict, including a planned ban on imports from Israeli settlements and sanctions against businesses and individuals involved in their expansion.
The dispute marks one of the most serious diplomatic confrontations between the two countries in decades.
The British Consulate in East Jerusalem, which deals with the Palestinian Authority and represents UK interests in Jerusalem, the West Bank and Gaza, has been given 30 days to cease operations, according to reports from Israel.
British representatives are also being removed from the US-led international co-ordination operation dealing with Gaza, while Britain’s role in training Palestinian Authority security forces in the West Bank is being terminated.
Israel has also barred 12 people from entering the country, including 11 British MPs.
Those MPs include Jeremy Corbyn, Zarah Sultana, Diane Abbott, Naz Shah, John McDonnell and Richard Burgon, as well as Green MPs Hannah Spencer, Carla Denyer, Siân Berry, Ellie Chowns and Adrian Ramsay. Lawyer Fahad Ansari is also on the list.
Israeli Foreign Minister Gideon Saar said the measures had been agreed with Prime Minister Benjamin Netanyahu and accused Britain of interfering in Israeli affairs ahead of the country’s election next month.
Saar described the British action as “morally distorted” and rejected Miliband’s allegations concerning the treatment of Palestinians in the West Bank as “outrageous lies”.
The confrontation began on Tuesday when Miliband told the House of Commons that Britain was substantially changing its policy towards Israel’s occupation of Palestinian territory.
The Government has long regarded Israeli settlements in the occupied territories as illegal under international law. Miliband went further, formally announcing that the British Government now considers the occupation itself unlawful, following the International Court of Justice’s 2024 advisory opinion.
He told MPs that the Government would introduce legislation banning imports of goods produced in Israeli settlements in the occupied territories.
A new sanctions regime will also allow action against companies and individuals providing construction, infrastructure, finance and real estate services which support settlement expansion.
Advertising Israeli settlement property in Britain will be prohibited, while the Government will refuse licence applications for arms and other exports which it judges would materially contribute to the occupation.
The legislation covering the new settlement regime is expected to take between six and nine months to come into force.
Miliband also announced immediate sanctions against further extremist settlers accused of supporting or inciting violence against Palestinians.
The Foreign Secretary told Parliament that the measures were directed at settlement activity and the Israeli government’s policies, rather than Israel itself. He said Britain would continue to support trade with Israel within its internationally recognised borders and explicitly rejected the wider Boycott, Divestment and Sanctions, or BDS, movement.
The change has been driven partly by mounting international concern over Israeli settlement expansion and the E1 project near Jerusalem.
Last month, the British Government condemned Israel’s publication of a tender for more than 1,200 homes under the E1 project. Ministers argue that development in the area would cut between East Jerusalem and the West Bank and make the creation of a viable Palestinian state increasingly difficult.
In his Commons statement, Miliband said there were around 270,000 Israeli settlers in occupied Palestinian territories at the time of the Oslo accords in 1993, compared with approximately 770,000 today.
He also cited UN figures which he said showed an average of six violent settler attacks against Palestinians every day this year.
In some of his strongest language, Miliband said the British Government agreed that “ethnic cleansing” of Palestinians was taking place in parts of the West Bank, carried out by what he called “settler terrorists”.
He accused the Israeli government of too often turning a blind eye to the violence and said some members of the government had supported the forced displacement of Palestinians.
Israel strongly rejects the characterisation.
The Israeli government also disputes the widely held international position that its settlements are illegal under international law. Israel captured the West Bank, East Jerusalem and other territories during the Six Day War in 1967.
Miliband stressed his own Jewish background as he announced the measures, describing himself as a proud British Jew and recalling how Israel had provided a home for his grandmother after members of his family were murdered by the Nazis.
He said he remained unwavering in his support for Israel’s existence and security, while arguing that this was compatible with supporting a Palestinian state.
The Foreign Secretary also condemned Hamas’s October 7 terrorist attacks and said Israel continued to face serious security threats from Iran and its proxies.
Alongside the measures concerning the West Bank, he announced sanctions against Hezbollah’s financial arm, Al-Qard Al-Hassan, and said Britain was reimposing major economic sanctions on Iran.
Miliband also addressed concerns about antisemitism in Britain, saying British Jews could not be held responsible for the actions of the Israeli government.
Speaking to the BBC on Wednesday morning, he defended the decision despite Israel’s retaliation, saying ministers had considered the consequences but could not allow fear of the Israeli response to prevent them from acting.
He said the Government believed the possibility of establishing a Palestinian state alongside Israel was being undermined by developments on the ground and that waiting longer risked reaching a point where a two-state solution was no longer possible.
The British move forms part of a wider international initiative.
Foreign ministers from 12 countries, Britain, Canada, Denmark, Finland, France, Iceland, Ireland, Norway, Poland, Portugal, Spain and Sweden, issued a joint statement on Tuesday warning that settlement expansion and settler violence were threatening the possibility of a two-state solution.
However, the countries have not all adopted identical measures.
Britain, France and Canada have committed to introducing national measures banning trade in settlement goods, while the wider group said its members intended to introduce national restrictions, support European measures, or were actively considering action.
The 12 governments also reaffirmed Israel’s legitimate security interests, condemned Hamas’s October 7 attack and reiterated their opposition to antisemitism.
Prime Minister Andy Burnham said the British measures were aimed not at the Israeli people, but at preserving the possibility of Israelis and Palestinians living alongside one another in peace.
The Palestinian leadership has welcomed the change while calling for further action.
Palestinian ambassador to the UK Dr Husam Zomlot described the measures as an important shift in Britain’s relationship with Palestine, while the Palestinian foreign ministry called for additional steps to stop settlement expansion.
The policy has also attracted fierce criticism inside Britain.
Chief Rabbi Sir Ephraim Mirvis described the announcement as a “dark day for British Jews” and argued that the measures would strengthen extremism rather than weaken it.
Conservative leader Kemi Badenoch has accused the Labour Government of singling out Israel. Following Tuesday’s announcement, she and shadow foreign secretary Tom Tugendhat spoke to Saar, who thanked the Conservatives for opposing the Government’s policy.
The United States has also made clear that it will not follow Britain’s approach.
US Secretary of State Marco Rubio said Washington would not adopt the same sanctions and warned that such measures could have consequences for efforts to stabilise Gaza and the wider region.
US ambassador to Israel Mike Huckabee has also strongly criticised the British policy.
Economically, the direct effect of banning settlement goods is expected to be relatively limited. Agricultural produce including dates, citrus fruit, herbs and wine are among products exported from West Bank settlements, but they account for only a small fraction of Israel’s overall exports.
Politically, however, the significance is considerably greater.
Britain is moving beyond its longstanding condemnation of settlements by attempting to separate its economic relationship with Israel itself from economic activity connected to occupied Palestinian territory.
The policy follows Britain’s recognition of a Palestinian state last year and represents another substantial change in the UK’s approach to the conflict.
For Israel, the response has been unusually severe. Closing the British consulate, ending British participation in Palestinian security training, removing UK representatives from the Gaza co-ordination operation and imposing entry bans on MPs amount to a significant downgrading of diplomatic co-operation.
The dispute could also create tensions between London and Washington, although President Donald Trump has yet to publicly set out his own response to the British decision.
For now, neither side appears willing to retreat, leaving relations between Britain and Israel facing one of their most difficult periods in recent history.
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