Keir Starmer has demanded Peter Mandelson resign from the House of Lords and urged the upper chamber to modernise its disciplinary procedures to allow peers to be stripped of their titles.
The cabinet secretary, the UK’s most senior civil servant, will also investigate Mandelson’s actions as business secretary when Labour was last in power, after emails to Jeffrey Epstein about highly sensitive government policy emerged.
The documents released on Friday by the US Department of Justice also appear to show Mandelson, as business secretary in 2009, forwarded a confidential UK government document outlining £20bn in asset sales and outlining Labour’s tax policy plans. He also told the disgraced financier that he was “trying hard” to change government policy on bankers’ bonuses at his request.
Downing Street said Mandelson should testify before the US Congress inquiry into the Epstein files if he was called, after a further huge tranche of documents was released over the weekend.
Mandelson was sacked last year as UK ambassador to Washington after new details came to light about his relationship with the convicted sex offender. He resigned his membership of the Labour party on Sunday night, saying he had done so to avoid causing it “further embarrassment” after more revelations about his friendship with Epstein. Labour said disciplinary action against him had already been under way.
In a briefing to journalists on Monday, Starmer’s official spokesperson said: “The prime minister believes that Peter Mandelson should not be a member of the House of Lords or use the title.
“However, the prime minister does not have the power to remove it. He is calling on those in the Lords to work with the government to modernise disciplinary procedures in the house, to allow for the easier removal of lords who have brought the house into disrepute.”
When asked specifically whether Starmer thought Mandelson should resign, the spokesperson said: “The prime minister is very clear. He should not be a member of the House of Lords.”
Government insiders hope the senior politician will choose to stand down from the Lords of his own accord, but will swiftly change the disciplinary process regardless. A No 10 source suggested they had received no assurances from Mandelson that he would voluntarily resign.
It is understood that the Lords conduct committee may be asked to consider making recommendations on how peerages could be removed more easily.
The DoJ documents relating to Epstein appeared to show Mandelson had leaked a sensitive Labour tax document in 2009 to the late sex offender that appeared to be for the then prime minister, Gordon Brown. While business secretary in June 2009, Mandelson forwarded an economic briefing, saying: “Interesting note that’s gone to the PM.”
The email, which began: “Dear Gordon”, was sent by Brown’s special adviser Nick Butler in the wake of the global financial crisis to Jeremy Heywood, the then No 10 chief of staff, and the then business minister Shriti Vadera, and proposed asset sales and potential policy measures.
Butler’s memo said: “I think the answer lies in releasing value from the very substantial asset base which the government holds. A number of business leaders who understand financial engineering have asked in different ways why we are borrowing so much and tolerating such high debt charges when we have saleable assets in hand which are not strategic – ie there is no good political or economic reason why they are in the public sector.
“I know Jeremy has done some work on this.
“The point which the Tories appear to have missed in focusing the argument on cuts v spending is that asset sales of even £20bn would relieve the debt burden, reduce borrowing costs, and provide some funds for new investment.”
In a released email exchange six months later, from which addresses have been redacted, Epstein asked Mandelson if the then government’s policy on bankers’ bonuses could be changed, to which he replied: “Trying hard to amend as I explained to Jes last night. Treasury digging in but I am on case.”
Labour promised in its manifesto to make it easier for rogue peers to be removed but has so far taken no steps to do so. There is no precedent for removing a specific person and it would require primary legislation. The last time this happened was during the first world war, when it applied to a group of peers.
Downing Street said the prime minister had asked the cabinet secretary, Chris Wormald, to review all available information regarding Mandelson’s contacts with Epstein during his period as a government minister, and to report back to him.
No timeframe has been given for the review, which could include examining documents in the National Archives and speaking to Mandelson and other contemporaries in No 10 at the time he was in correspondence with Epstein.
Starmer’s spokesperson also said that if Mandelson was called to testify before the US Congress about Epstein, he should. The files released over the weekend had led to the prime minister deciding to take further action.
“The prime minister has always said that anyone who’s got information should be prepared to share that information in whatever form they are asked to do that, because you can’t be victim-centred if you are not prepared to do that,” he said.
On his trip to China last week, Starmer had said Andrew Mountbatten-Windsor should testify to Congress, but that he had “nothing more to add” on Mandelson.
Downing Street was aware at the time of appointing Mandelson that making him US ambassador was a high-risk, high-reward strategy, but could not have envisaged such a swift fall from grace.
Kemi Badenoch, the Conservative leader, had said the Cabinet Office must launch a full investigation into Mandelson’s links with Epstein and the run-up to his appointment as US ambassador.
The files released on Friday separately suggested Epstein sent Mandelson $75,000 (£54,725). Bank statements appear to show three separate payments of $25,000 referencing the former UK business secretary being sent from Epstein’s JP Morgan bank accounts.
Correspondence also appeared to show that Mandelson’s husband, Reinaldo Avila da Silva, had successfully asked the financier to pay him £10,000 in September 2009 to fund an osteopathy course and other expenses. Mandelson has said he has no recollection of the funds being requested or offered.
A Labour spokesperson said: “It is right that Peter Mandelson is no longer a member of the Labour party. Disciplinary action was under way prior to his resignation. Jeffrey Epstein’s heinous crimes destroyed the lives of so many women and girls, and our thoughts remain with his victims.”
