Sir Keir Starmer’s judgement is under renewed attack after newly released papers revealed that he was warned in detail about the dangers of appointing Peter Mandelson as ambassador to the United States.
The first tranche of documents relating to Lord Mandelson’s employment show that the prime minister was briefed that the former minister had maintained “close ties” with Jeffrey Epstein even after the paedophile financier was first convicted of procuring an underage girl in 2008, and that hiring him would bring a “general reputational risk” for the government.
The files make clear that Sir Keir ignored the warnings after his then chief of staff, Morgan McSweeney, and former director of communications, Matthew Doyle, who was described in the documents as a “personal friend” of Lord Mandelson, appeared to give their support to the Labour peer.
The files also revealed that Lord Mandelson received a taxpayer-funded £75,000 payout after he was sacked in September, as the government sought to avoid a protracted legal challenge – but had first demanded more than £500,000.
Among the revelations in the documents, it emerged that:
The 31 files released by the government did not include correspondence between No 10 and Lord Mandelson, in which a number of follow-up questions were asked about his relationship with Epstein, because those exchanges remain subject to the ongoing police investigation into allegations of misconduct in public office.
Sir Keir has insisted that Lord Mandelson “lied repeatedly” to No 10 about the “depth and extent” of his relationship with Epstein, but the papers reveal that senior officials had concerns about his appointment.
A record of a call between Mr Powell and Mike Ostheimer, the general counsel to the prime minister, said Mr Powell had “raised concerns about the individual and reputation” to Mr McSweeney.
It added that “MM [Morgan McSweeney] responded that the issues had been addressed.” The call was made in September 2025 as part of a fact-finding process surrounding Lord Mandelson’s sacking.
The documents heap more pressure on a prime minister whose future has been in doubt for months, and raise further concerns around his decision to appoint Lord Mandelson – who had twice been sacked from government posts – when a number of career diplomats were available to fill the role.
MPs were furious that the documents, published after Labour rebels backed a motion by the Tories calling for their release, came out after Prime Minister’s Questions, leaving the chancellor of the Duchy of Lancaster, Darren Jones, to answer questions instead of the prime minister.
Tory leader Kemi Badenoch said: “Mandelson reportedly leaked sensitive government documents. Starmer knew Mandelson had stayed close friends with Epstein after the conviction for child prostitution, but made him ambassador anyway. Now we see he paid Mandelson almost £80k of our money. His judgement is shocking.”
Speaking to the Commons, Mr Jones defended the payout, telling MPs: “The settlement that was agreed was to avoid even higher further costs involving a drawn-out legal claim at the employment tribunal.”
Labour MP Richard Burgon said: “It is clear the prime minister wouldn’t have given the go-ahead for this individual, Peter Mandelson, to stand as a Labour candidate for town council, but instead he was elevated, despite what is in the document, to this most important of positions.”
Justin Madders, a former minister in Sir Keir’s government, added: “If one of my constituents came to see me and told me that they’d lost their job or been sacked because they had lied during the application process, and wanted compensation, I would tell them that they had absolutely no chance of doing that.”
Meanwhile, Tory 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.”
Sir Ed Davey has called the documents “Britain’s Epstein files” and has urged Lord Mandelson to give his £75,000 payment to charity. The Tories have also called for him to return the pay-off.
Last month, MPs ordered the government to release tens of thousands of documents relating to Lord Mandelson’s appointment following the publication of the so-called Epstein files by the US Department of Justice.
A second, potentially more damaging batch of papers is due to be published when the police are satisfied that it will not interfere with their criminal investigation into Lord Mandelson, but Mr Jones said these files will “show that the prime minister was lied to” by the former ambassador, who Mr Jones admitted “should never have been allowed to represent the UK”.
He insisted that Sir Keir “regrets appointing him as ambassador”.
The decision to appoint the former EU trade commissioner and UK business secretary was driven by the need to forge a close relationship with US president Donald Trump, who returned to the White House in January 2025. But an official note to the prime minister warned of the risk in making a political appointment: “If anything goes wrong, you could be more exposed as the individual is more connected to you personally.”
Regarding Lord Mandelson’s Global Counsel lobbying firm, the document states: “Reputational risks could occur relating to any of these clients’ dealings with the UK or USA government. Global Counsel did not declare any lobbying clients under the last quarter of the Sunak administration, media reporting is noting the group’s expansion since the election.”
It lists a number of the firm’s clients, including TikTok, Shell, Accenture, the Premier League, JPMorgan, Santander, BP, Sizewell C, and Shein.
Sir Keir is already facing questions over an off-the-books meeting he had with Lord Mandelson when he was ambassador in Washington, with another of his clients, Palantir.
The due diligence document also highlights that in 2014, Lord Mandelson agreed to be a “founding citizen” of an ocean conservation group founded by Ghislaine Maxwell and funded by Epstein. Disgraced socialite Maxwell is a former girlfriend of Epstein and was jailed for 20 years in the US in 2022 for sex trafficking.
