Sir Keir Starmer has been accused by the families of Israeli hostages of handing Hamas “its greatest prize” after he formally recognised a Palestinian state.

The prime minister said that recognition could help “revive the hope of peace” and end the “horror” of the humanitarian crisis unfolding in Gaza. “We cannot let the light of peace go out,” he said.

He insisted that the move was not a “reward” for Hamas, condemning it as a “brutal terror organisation” and warning that it must have “no future [and] no role in government”. The UK made the move alongside Canada and Australia before a meeting of the UN general assembly.

However, the prime minister faced a backlash from Israel and the families of hostages who have been held in Gaza, along with Jewish leaders in the UK.

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Binyamin Netanyahu, Israel’s prime minister, said that it was a “huge reward to terrorism”, adding that a Palestinian state “will not happen”. The US has also long opposed the move.

Close-up of Benjamin Netanyahu at a press conference.

Binyamin Netanyahu

NATHAN HOWARD/AP

Moshe Emilio Lavi, the brother-in-law of Omri Miran who is still being held by Hamas in Gaza, said: “While our loved ones are being purposely starved, tortured, and used as human shields, the UK has chosen to hand Hamas and its accomplices the greatest prize — an unconditional recognition of statehood.”

Mandy Damari, whose British-Israeli daughter Emily was held hostage by Hamas for more than 15 months, said that Starmer was under a “delusion”.

“While one of the states is still run by a proscribed terrorist organisation whose very charter is to annihilate Israel from the river to the sea, a two-state solution can never happen,” she said.

“But even if he thinks he is right, he is rewarding Hamas for the October 7 barbaric and savage attack on Israel when the hostages are still not back, the war is not over and Hamas are still in power in Gaza.”

Why Keir Starmer has finally recognised Palestine as a state

Starmer used his statement on Sunday to condemn the actions of both Israel and Hamas. He said that Hamas must release the Israelis taken on October 7, highlighting images showing them “suffering and emaciated” with Hamas refusing to release the bodies of the dead.

“Let’s be frank, Hamas is a brutal terrorist organisation,” he said. “That call for a genuine two-state solution is the exact opposite of their hateful vision. We are clear this solution is not a reward for Hamas because it means Hamas can have no future, no role in government, no role in security.”

He said that further sanctions would be imposed on Hamas in coming weeks.

However, he also warned that the “man-made humanitarian crisis” in Gaza was reaching “new depths”, highlighting the military assault on Gaza City. “The starvation and devastation are utterly intolerable,” he said. “Tens of thousands have been killed, including thousands as they try to collect food and water. It must end.”

Destroyed street in Gaza City during an Israeli military operation.

Starmer said the “man-made humanitarian crisis” in Gaza was reaching “new depths”, highlighting the Israeli military assault on Gaza City

MOHAMMED SABER/EPA

Writing in The Times, Yvette Cooper, the foreign secretary, said that “it would be easy for faith in a two-state solution to disappear beneath the rubble. That is exactly what extremists on all sides want. But we cannot allow hope to be lost”.

The UK will recognise the principle of a Palestinian state based provisionally on 1967 borders, before Israel occupied the Gaza Strip and West Bank. The government envisages that there would be land swaps in any final agreement.

Successive UK governments had said that they would recognise Palestine only as part of a wider peace process towards a so-called two-state solution in the region.

However, following Israel’s continuing bombardment of Gaza and the humanitarian crisis in the territory, Starmer said in July that he would bring the decision forward unless Israel agreed to three conditions.

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The first was to bring about a ceasefire in Gaza, the second was to recognise a two-state solution and the third was an agreement not to annex the occupied West Bank. Starmer confirmed that he was acting because none of those conditions had been met.

The Board of Deputies of British Jews said that there would be “deep dismay” about the announcement.

“The way the UK has chosen to recognise a Palestinian state has done nothing to advance a ceasefire, free the hostages, stop the suffering of Palestinians in the Gaza Strip, or advance long-term peace,” it said.

“It may have set those goals back, by reducing pressure on Hamas and enabling them to claim recognition as the ‘fruits’ of its violence and intransigence.”

However, Mahmoud Abbas, the Palestinian Authority president, said that recognition would help pave the way for Palestinians to live “side by side with the state of Israel in security, peace and good neighbourliness”.

Husam Zomlot, head of the Palestinian mission to the UK, added: “Today is a moment when the UK prime minister and the British government, on behalf of their people, stand and say: ‘We must correct history, we must right the wrongs’.”

Husam Zomlot, Head of the Palestine Mission to the UK, giving a thumbs-up during an interview.

Husam Zomlot, head of the Palestine mission to the UK

JUSTIN TALLIS/AFP/GETTY IMAGES

Kemi Badenoch, the Conservative leader, warned that the country would “rue the day the decision was made” as it was “rewarding terrorism with no conditions whatsoever put in place for Hamas” and Nigel Farage, the Reform UK leader, said that the move would “do nothing to bring about peace”.

However, Sir Ed Davey, the Liberal Democrat leader, described the move as “historic”. He said: “The government now needs to follow through and do all it can to secure a ceasefire, an end to the cycle of violence and a two-state solution which is the only way to ensure a permanent end to the conflict.”