Lord Peter Mandelson requested a compensation package exceeding £500,000 following his dismissal as the US ambassador by Keir Starmer due to his association with Jeffrey Epstein. The released documents indicate that the government agreed to provide a £75,000 severance package to the Labour figure, comprising £40,330 as three months’ pay in lieu of notice and a termination payment of £34,670.
However, the dossier reveals that Lord Mandelson aimed for a much higher payout at the expense of taxpayers. Negotiations initially involved a demand to cover the remaining 4-year salary costs, amounting to £547,201. Correspondence shows officials acknowledging the effort to significantly reduce the settlement with minimal resistance.
Initially earning £157,000 annually for the prestigious role in Washington, Lord Mandelson’s salary increased to £161,318 by April 2025. This information was disclosed in a 147-page document released following parliamentary pressure to unveil files related to his appointment as the US ambassador.
The veteran Labour member was ousted by the Prime Minister in September after fresh revelations emerged regarding his ties with Epstein. Questions arise concerning Starmer’s knowledge at the time of Mandelson’s appointment.
Subsequently, Lord Mandelson, aged 72, faced arrest in February for alleged misconduct in public office, linked to leaking sensitive information to Epstein during his tenure under Gordon Brown’s administration.
While some files remain restricted for national security or diplomatic reasons, the Intelligence and Security Committee has the final authority to determine redactions. An agreement has been reached between the government and Scotland Yard to release certain documents without impeding an ongoing police inquiry.
Chief Secretary to the Prime Minister, Darren Jones, informed MPs that the due diligence report on Lord Mandelson did not fully expose the extent of his association with Epstein. Jones emphasized the importance of acknowledging the trauma endured by Epstein’s victims and pledged to adhere to parliamentary directives.
Furthermore, the government is reviewing the possibility of refining regulations on lobbying and paid advocacy to align the House of Lords with Commons’ procedures. Liberal Democrat leader Sir Ed Davey criticized the payout as disrespectful to Epstein’s victims, urging Mandelson to donate any severance received to charity.