What’s happened: Foreign Secretary Ed Miliband told Parliament yesterday that he would carry out a “comprehensive reset” of Britain’s policy to Israel that would include as yet unspecified measures against Israel.
- Miliband specifically addressed the issuing of construction tenders for the controversial E1 settlement located between Jerusalem and the Israeli town of Maaleh Adumim. In his remarks, he said, “we do not want British companies financing, constructing, or advertising new settlements. The work we are now undertaking is how we can stop that. And as I say, I’ll have more to say soon.”
- Stephen Doughty, the Middle East Minister, went further than Miliband and suggested that the UK Government was considering a ban on trade with settlements.
- Israel’s Foreign Minister Gidon Saar reacted to Milliband’s remarks, saying that “if Britain acts against the state of Israel, the state of Israel will act against Britain. We have the tools. The period is over when people act against the state of Israel and the state of Israel doesn’t respond.”
- Yesterday’s announcement marks the eighth time that the UK has announced punitive measures taken to reduce violence and promote peace in the Israeli-Palestinian conflict since the war which began with Hamas’ invasion and massacre on October 7, 2023. All eight announcements have included punitive measures against Israel and none against the Palestinians.
- Twice in 2024, Britain announced sanctions against settlers in the West Bank and once in the same year it suspended 30 defence export licences.
- In 2025, the UK suspended negotiations on a UK-Israel free trade agreement, sanctioned two far-right ministers in the Israeli government, and recognised a Palestinian state.
- Earlier this year, it expanded the measures against settlers and a settlement related financial entity as well as issued a warning to British businesses against activity in Israeli settlements.
- The only comparable measure in the other direction was a pause in funding for UNRWA in early 2024 that was reversed when the Labour government came into power in July that same year. Support for UNRWA, which considers Palestinians born and living in Palestinian territory under Palestinian governments to be “refugees” from Israel, would seem to undermine the prospect of a two-state solution at least as much as settlement construction (and empirically much more) without igniting the same passions in Westminster.
- If the proposed measures are indeed focused only on the E1 tenders and the issue of settler violence, they are likely to upset bilateral ties without irreversibly scarring them. A trade ban on all settlements, on the other hand, will have far-reaching consequences for the relationship between the two countries that will not be easy to walk back even if, as polls suggest, a more moderate government is elected in Israel in October that cracks down on settler violence.
- It is nearly impossible to separate Israeli companies that have business in settlements from those that don’t, especially if the UK government insists on treating East Jerusalem, which Israel considers part of its sovereign territory, as housing “settlers.” Of some 770,000 Israelis living beyond the Green Line, 245,000 are in East Jerusalem, and 362,000 are in the major settlement blocs hugging the line that have been included in proposed land swaps in all the major proposed peace deals of the last 30 years.
- A finding by the Government that bans trade with Israeli companies in settlements, if it includes Jerusalem and the blocs, could be used by activists to effectively boycott almost any Israeli business. It would also be an opening for legal and social harassment of large numbers of British Jews.
- It is unclear what measures Israel might take in response. Recently Israel ejected Dutch officials from the CMCC, the coordinating mechanism set up for implementing the Gaza ceasefire. Britain is one of the largest participants in the CMCC after the United States. Israel could restrict access of British officials to other internationally sponsored missions in Gaza and the West Bank.
- Israel could also scale back its intelligence sharing and defence exports to Britain. And it could take measures against the British diplomatic mission operating a consulate in East Jerusalem.
Context: For both countries the rhetorical escalation is not just a matter of foreign policy, but rather deeply embedded in domestic politics. British political and media discourse has been plagued since the October 7 massacre by voices that excuse the massacre and condemn Israel’s response to it in terms that have inspired harassment, social exclusion, and physical attacks against British Jews. Demonisation of Israel has also proved electorally crucial, and the new Burnham government is keen for a performative act to demonstrate its bona fides to constituencies that sent independent, Gaza-focused, MPs to Westminster from former Labour strongholds.
- The announcement meets Israel in the heat of an emotional electoral campaign as well, its first since the October 7 massacre. Polls overwhelmingly show the current right-wing and religious coalition going down to defeat. Announcing sanctions now can only serve to shore up support for the pro-settlement parties of Smotrich and Ben Gvir.
- The issue of E1, which has united western governments in opposition to Israel, is a peculiar one for a number of reasons.
- The claim that E1 cuts the West Bank in two, repeated yesterday by the Foreign Secretary, is simply wrong. Even without E1 — even without Maaleh Adumim, which sits to its east — a future Palestinian state in the West Bank is still wider at its narrowest point than Israel without the West Bank is at its narrowest point, near Netanya. No one seriously claims that Israel is cut in two, or that an Israeli traveling around the West Bank to get from Jerusalem to Tiberias or Beersheva is somehow unduly impeded.
- In all the major peace proposals of the past generation, whether at Camp David in 2000 or Taba in 2001 or in the Annapolis talks in 2007 or the Olmert proposal to Abbas in 2008 or even the bridging proposal tabled by John Kerry in 2014, E1 was in the territory that was to be included in Israel. The claim that a dramatic line is being crossed simply doesn’t hold up against the historical record or basic geography.
- And if it were the case that E1 is such a damaging move to Palestinian statehood, it would stand to reason that its proposed construction would be an impetus for the Palestinians to make peace with Israel sooner rather than later. But there is no expectation of that in Miliband’s statement or in UK policy in general, which not only doesn’t envision measures to persuade the Palestinians to make peace with Israel and end their century-long struggle against the existence of a Jewish state, but doesn’t actually recognise that there has been such a rejection or that there should be consequences for it. The peace proposals all mentioned above (especially those in 2001, 2008, and 2014) didn’t go into effect for one simple reason: while the Israelis accepted them, the Palestinians explicitly rejected them and chose violent struggle instead.
- UK policy that improves the terms for the side of the conflict pushing rejection and violence can only serve to incentivise more rejection and violence.
- The two other issues cited as reasons for the “comprehensive reset” are the war in Gaza and the increasing acts of violence by radical settlers in the West Bank.
- The war in Gaza began with the Hamas invasion nearly three years ago and has been in a ceasefire for more than ten months. Many countries are seeking an active role in the ceasefire implementation and especially with any future reconstruction projects. There is much to be sceptical about in Gaza, but if reconstruction succeeds, it will be the basis of any future diplomatic progress on the Israeli-Palestinian front. For Britain to manoeuvre itself out of a role there would be net loss for British influence and diplomacy in the region. At any rate, progress has been stuck in recent weeks due to Hamas’ refusal to carry out the disarmament it agreed to in the ceasefire last year. Punitive measures against Israel will only reward it.
- The issue of settler violence has been the focus of much media attention and public discussion, especially the ongoing crisis in Qusra. Despite widespread condemnation, including from Prime Minister Netanyahu, the opposition and even within the mainstream settler movement, not enough action has been taken to root out the phenomenon. However, the proposed UK measures, especially if they affect a broad range of Israeli businesses, take the focus off the violent extremists and make the pro-settlement’s movement argument for it.
Looking ahead: The UK’s unilateral recognition of a Palestinian state, without conditions, alongside the persistent focus on Israel in UK political and media discourse, and the rise in antisemitism in the UK, has led many Israelis to view the UK as hostile to their legitimate security concerns.
- Britain is seen as taking measures to address a moralising view of the conflict for domestic consumption that often have little to do with the actual conflict. Railing against settlements as a deep cause of Palestinian violence might be cathartic, but there were no settlements in Gaza when Hamas launched its attack on October 7 as these had all been dismantled in 2005.
- Recognising a Palestinian state to register displeasure with Israeli policy might make sense if a Palestinian state were waiting in the offing but Israeli opposition was what was stymying it, but in reality there were two different governments operating in two Palestinian territories and a state had not come into existence in any of the peace processes because the Palestinians rejected establishing one in parallel to making peace with a Jewish state next door.
- Further steps, even if couched in language about settlements, risk inviting boycotts (formal or informal) against all Israel businesses and eventually those of British Jews as well. They won’t just be open for abuse by anti-Israel activists in Britain; they will empower far-right elements in Israel just as these appear to be headed for electoral defeat. And they risk leading to Britain’s exclusion from the emerging diplomatic arrangements that could begin in postwar Gaza and, if successful, eventually include a broader Israeli-Palestinian peace process in the West Bank as well.


