Keir Starmer was accused of rewarding Mandelson for ‘betraying’ Britain today as damning papers about the Labour grandee’s appointment were released.

Bombshell documents show peer was handed a £75,000 payoff when he was sacked as US ambassador over his friendship with paedophile Jeffrey Epstein. 

The disgraced former Cabinet minister had apparently been demanding £547,000 compensation for losing his £161,000 a year job and threatening legal action.

Despite the PM claiming in Parliament that Mandelson ‘lied’ during his vetting, the government privately assessed was there was no evidence of ‘misconduct in role that would give rise to normal disciplinary proceedings’. 

Foreign Office permanent secretary Olly Robbins wrote of the package: ‘This represents good value for money.’ Other officials congratulated each other on getting the sum – including £34,000 severance as well as cash in lieu of notice – ‘so low’. 

Extraordinarily, the Chief Secretary to the Treasury, James Murray, responded that he was ‘happy’ to sign the payment off.  

Meanwhile, the papers published by the government confirm that Sir Keir was aware when he appointed Mandelson in December 2024 that his friendship with the financier continued after he was convicted. 

In December 2024, a note from a senior aide to the premier stated he and chief of staff Morgan McSweeney had expressed a ‘preference for a political candidate’ to be Washington envoy and Mandelson was the ‘lead candidate’.

It said the Director of Communications – Tim Allan at the time – had been ‘satisfied’ with Mandelson’s responses about his relationship with Epstein.

A three-page ‘due diligence’ report supplied on December 11 2024 to Sir Keir – who dodged facing MPs on the revelations in the Commons today – flagged the ties between Mandelson and Epstein.

It referred to reports of Epstein’s ‘particularly close relationship with Prince Andrew the Duke of York and Lord Peter Mandelson’ and said their contact continued through the 2000s.

The summary stated: ‘After Epstein was first convicted of procuring an underage girl in 2008, their relationship continued across 2009-2011, beginning when Lord Mandelson was Business Minister and continuing after the end of the Labour government. 

‘Mandelson reportedly stayed in Epstein’s House while he was in jail in June 2009.’ 

It also mentioned that in 2014 Mandelson ‘agreed to be a ”founding citizen” of an ocean conservation group founded by Ghislaine Maxwell, and funded by Epstein.’ 

Downing Street insisted the ongoing police investigation into Mandelson means it is unable to release details about what questions the peer was asked.

On another dramatic day in Westminster:

• Chief Secretary to the PM Darren Jones said all sides of the House wanted ‘full transparency and accountability’, and Sir Keir had taken ‘responsibility’ and ‘apologised’ for Mandelson’s appointment as ambassador;
• The documents include a 2002 email from Mandelson to No10 chief of staff Jonathan Powell about arranging a meeting between Epstein and Tony Blair;
• Mr Powell, now No10 national security adviser, told the PM’s counsel in September last year that he had expressed concerns about Mandelson’s initial appointment, but was told by Mr McSweeney that the ‘issues had been addressed’; 
• Mr Allan and Mr McSweeney have already resigned from Downing Street amid the maelstrom; 
• Mandelson is said to have argued for a bigger payoff because the government’s actions had ‘permanently damaged his employability’; 
• A statement revealing the size of Mandelson’s severance package was seemingly cleared last month, but never made public;  
• The government has announced the rules around lobbying, business appointments, and financial disclosures for ministers are being reviewed by the Ethics and Integrity Commission; 
• There are understood only to have been very limited redactions from the material, overseen by the Intelligence and Security Committee; 
• A former No10 aide has condemned Lord Mandelson’s lack of ‘contrition’ for sending Epstein sensitive government information.

Lord Mandelson pictured with Jeffrey Epstein. They had a long-standing friendship 

Keir Starmer – who only agreed to disclose the material after a massive revolt by Labour MPs – will not personally face a grilling on the documents today

A note written by a senior No10 aide revealed that the Director of Communications had been ‘satisfied’ with Mandelson’s responses about his contact with Epstein 

A three-page ‘due dilligence’ report supplied to Sir Keir on December 11 flagged the ties between Mandelson and Epstein

Lord Mandelson outside his London home this morning ahead of the documents being released

The turmoil over Mandelson was sparked after a massive trove of Epstein’s personal emails was leaked in the US last September, and then officially released. 

Sir Keir – who only agreed to disclose the material after a massive revolt by Labour MPs – will not personally face a grilling on the documents today.

Instead, Mr Jones made a statement in the House. The initial release runs to 147 pages, with thousands more to come later.

The timing has sparked accusations from the Conservatives that the Prime Minister is attempting to ‘dodge questions’. 

Last month the Commons approved a motion ordering the release of a huge range of material, including messages between Lord Mandelson and ministers and senior officials that could prove embarrassing for the Government.

Following the vote, Sir Keir said he wanted to ensure ‘urgency and transparency’ and apologised for believing the peer’s ‘lies’ about the extent of his relationship with Epstein.

But the scandal triggered a meltdown in Downing Street that almost saw the PM ousted, with his chief aide Morgan McSweeney resigning. 

In a key moment, Kemi Badenoch asked Sir Keir at PMQs on February 4 whether ‘the official security vetting he received mentioned Mandelson’s ongoing relationship with the paedophile Jeffrey Epstein’.

The premier replied: ‘Yes, it did. As a result, various questions were put to him.’

Sir Keir said: ‘He lied repeatedly to my team when asked about his relationship with Epstein, before and during his tenure as ambassador. 

‘I regret appointing him. If I knew then what I know now, he would never have been anywhere near Government.’ 

Some files are being withheld for national security or foreign relations reasons, but the final say rests with Parliament’s Intelligence and Security Committee.

Ministers had initially wanted to give the Cabinet Secretary control over which papers would be released, but caved to mutinous backbenchers.

The Government has also agreed a framework with the Metropolitan Police on which documents can be released without prejudicing the ongoing police investigation into Lord Mandelson, according to the ISC.

Lord Mandelson was arrested on February 23 on suspicion of misconduct in public office, having been accused of passing sensitive information to Epstein during his time as business secretary.

He was subsequently bailed, but later handed his passport back and freed under investigation. He has denied any criminal wrongdoing or acting for personal gain. 

A No10 private office note released today showed Sir Keir decided to sack Mandelson after the publication of leaked emails revealing ‘a depth and extent of a relationship with Epstein which he had not been aware of previously when he made the decision to appoint Mandelson’.

The memo said that at a meeting on September 11, the PM ‘referenced the his concern at the judgments and views expressed in the cache of emails released by Bloomberg, that the answers Mandelson provided to FCDO PUS (Foreign, Commonwealth and Development Office permanent under-secretary) Olly Robbins regarding the emails did not give him confidence that there were not further revelations to come and the serious discomfort in the PLP.

‘The emails revealed a depth and extent of a relationship with Epstein which he had not been aware of previously when he made the decision to appoint Mandelson.

‘On this basis, he proposed to ask Mandelson to resign from his post as HMA Washington.’

The note also said: ‘The Chief Whip emphasised the serious discomfort amongst the PLP.

‘The Prime Minister was clear about his strong concern for Epstein’s victims and the importance of the work of the Government to tackle Violence against Women and Girls.’

Sir Olly then ‘spoke by telephone to Mandelson towards the end of the meeting to inform him of the Prime Minister’s decision and of the next steps’, the memo said, adding that ‘it was noted that the Palace had been informed of the decision during the meeting’.

Bombshell documents show the Labour grandee was handed a £75,000 payoff when he was sacked as US ambassador over his friendship with paedophile Jeffrey Epstein

Mandelson had demanded a £547,000 payout according to the papers 

The PM’s chief minister Darren Jones will make a statement in the House after the PM’s weekly questions session

The documents reveal the shift in the PM’s stance after the extraordinary revelations in Epstein’s personal emails  

However, Mandelson does not seem to have been willing to go quietly.

On September 17 last year he wrote to No10’s chief people officer Mark Power saying: ‘My chief concern is leaving the US and arriving in the UK with the maximum dignity and minimum media intrusion which I think is to the advantage of all concerned, not least because I remain a crown/civil servant and expect to be treated as such.’ 

An email from Mr Power to government colleagues on September 24, 2025 describes a meeting with the peer.

‘He has sought advice, during the conversation he intimated this had been from Senior Counsel (a KC) specialising in employment law,’ Mr Power wrote. 

‘His argument heavily focusses on the reasonableness of the PM’s decision. There is some carefully placed language around the public implications of not reaching a settlement, and the nature of an employment tribunal case.’

The message added: ‘There is a potential, that absent a positive indication, Peter goes public on some of his claims so there is some urgency.’

A paper justifying the severance deal with Mandelson noted that the first £30,000 would be tax-free. 

‘There is no suggestion of misconduct in role that would give rise to normal disciplinary proceedings, and the individual has a high profile which could give rise to reputational damage to the FCDO and HMG were a court or tribunal claim to be pursued,’ it added. 

It is unclear whether the PM’s stance that Mandelson ‘lied’ was based on the full cache of Epstein emails released by the DoJ at the end of January, rather than the set leaked in September – at which point No10’s language was more nuanced.  

Tory frontbencher Neil O’Brien voiced fury at the payoff for Mandelson. 

He said: ‘£70,000 bung for betraying Britain. Unreal. 

‘And just wait for Starmer to whine, ”the process was followed, there was nothing I could do” Pitiful.’ 

Shadow Cabinet Office minister Alex Burghart said: ‘These documents just confirm what we already knew. 

‘Keir Starmer was plainly aware of the relationship between Mandelson and the world’s most notorious paedophile when he appointed him as US ambassador.

‘What’s worse, the Government gave him a payoff of £75,000 despite his resignation in disgrace. No one will be able to trust the Prime Minister’s judgment again.

‘The Labour Government need to come clean on what documents have been hidden from view and whether WhatsApps or private emails have been deleted or hidden.

‘The Government must release the files in full and make Mandelson repay the money.’

Touring broadcast studios this morning, Mr Jones insisted the Commons timetable meant his statement had to come after PMQs.   

Mr Jones told Times Radio: ‘We were always teed up to report in early March with the first tranche of documents, which is what we’re doing this afternoon.

‘Because I run the Cabinet Office, at the centre of government, it was always my responsibility to give those updates to the House of Commons and statements always come after Prime Minister’s Questions.’

He added: ‘There will be a second tranche of documents that will come at a later stage.’

Mr Jones told ITV’s Good Morning Britain: ‘On the specific issue of Peter Mandelson’s appointment as ambassador to the United States, the Prime Minister has apologised for his appointment and said that it was a mistake.

‘The documents that will be published today later to Parliament will provide full transparency about the appointments process, bar one document that has been held back by the Metropolitan Police because of an ongoing criminal investigation.

‘The Prime Minister said that we only really knew of the depth and extent of Peter Mandelson’s ongoing relationship with Jeffrey Epstein once documents had been published by first Bloomberg and then the United States Department of Justice.

‘As soon as those documents became available, and it became obvious that Peter Mandelson had lied to the Prime Minister about the depth and extent of his relationship, he was sacked as ambassador the United States very promptly.’

On Sky News, Mr Jones said: ‘It’s a big number of documents. Government takes its responsibility to be transparent to Parliament really seriously.

‘And of course, on this issue of Peter Mandelson and his relationship with Jeffrey Epstein, we all have a shared interest in bringing some accountability and transparency to these these issues.

‘So the first tranche will be published this afternoon. A second tranche, they will come later, because there’s been further work that we’ve had to do across Government in response to the humble address, which is not quite ready.

‘And we have two other processes that take a bit of time, given the live criminal investigation with the Metropolitan Police and the role of the Intelligence and Security Committee in Parliament has some oversight of it.’