Labour Government In Crisis Over Mandelson Epstein Files

It was a day of high drama in the House of Commons on February 4, 2026, as Prime Minister Keir Starmer’s Labour government faced a near-rebellion over the explosive Peter Mandelson files. The controversy centered on the government’s attempt to limit the release of documents detailing Lord Mandelson’s appointment as UK ambassador to the United States and his relationship with disgraced financier Jeffrey Epstein. Amid mounting pressure from backbenchers, opposition parties, and the public, the government was forced into a last-minute climbdown that handed oversight of the files to Parliament’s Intelligence and Security Committee (ISC), stripping the executive of the power to decide unilaterally what could be withheld on national security grounds.

The crisis erupted after new revelations about Lord Mandelson’s friendship with Epstein, a convicted sex offender who died in 2019, triggered a police investigation into whether Mandelson had passed sensitive government information to Epstein. According to the BBC, emails released by the US Department of Justice suggest Mandelson forwarded internal Downing Street memos about a €500 billion EU bailout in 2010 and received $75,000 in payments from Epstein in the early 2000s. Lord Mandelson, who was sacked as ambassador in September 2025, has since retired from the House of Lords and faces the loss of his Privy Council membership, with legislation being drafted to strip him of his title.

The government’s initial plan was to let the Cabinet Secretary decide which documents could be withheld on national security or diplomatic grounds, a move that infuriated Labour MPs and opposition parties alike. Angela Rayner, Deputy Prime Minister and a key figure in the unfolding drama, intervened decisively. She called for the ISC—a cross-party committee with the highest security clearance—to take charge of vetting the files, arguing this would help maintain public confidence in the process. As The Telegraph reported, Rayner’s intervention was praised as an act of “swift political judgment” that prevented a damaging split within the Labour Party.

Sir Keir Starmer, under intense scrutiny, admitted in the Commons that he had been misled about the "sheer depth and extent" of Mandelson’s relationship with Epstein. “He lied repeatedly to my team when asked about his relationship with Epstein before and during his tenure as ambassador. I regret appointing him,” Starmer stated, as quoted by the BBC. “If I knew then what I know now, he would never have been anywhere near government.” The Prime Minister also confirmed he was aware of Mandelson’s ongoing friendship with Epstein at the time of the appointment, but insisted he did not know the full extent of their ties.

The fallout was immediate and severe. Conservative leader Kemi Badenoch accused the government of trying to “sabotage” the disclosure process, declaring in Parliament, “This is not about national security, this is about his job security.” Badenoch pressed Starmer on whether the official security vetting flagged Mandelson’s relationship with Epstein. Starmer replied, “Yes it did. As a result, various questions were put to him.” The Conservative motion, designed to maximize embarrassment for Labour, demanded the release of all relevant documents, including emails and texts between Mandelson, ministers, and Starmer’s chief of staff, Morgan McSweeney.

Labour backbenchers were openly furious. As Express reported, one MP said, “I don't want to be part of a cover up.” Veteran Labour MP Clive Efford voiced the frustration of many: “The only way to deal with this is to publish everything.” Lib Dem MP Lisa Smart added there were “huge questions around the judgement” of Starmer, while Lib Dem leader Sir Ed Davey called for a full public inquiry and questioned whether Mandelson may have leaked state secrets to Epstein, even suggesting Epstein could have been a Russian agent.

Public and political pressure mounted as the Metropolitan Police launched a criminal investigation into Mandelson’s conduct, specifically whether he had passed market-sensitive government information to Epstein while serving in Gordon Brown’s government. The police asked the government not to release certain documents that could undermine their investigation, but Commons Speaker Sir Lindsay Hoyle clarified, “The Metropolitan Police have no jurisdiction on what this House may wish to do.”

Further complicating matters, Nigel Farage, leader of Reform UK, called for the European Anti-Fraud Office (Olaf) to investigate Mandelson’s tenure as EU trade commissioner, alleging he leaked confidential EU bailout information to Epstein for personal gain. “Lord Mandelson has potentially used his EU office for personal financial gain and/or has leaked information confidential to the Commission to a private individual in breach of his professional secrecy obligations,” Farage wrote in his letter to Olaf, as reported by Express.

Inside Labour, the scandal ignited a fierce civil war. Angela Rayner’s call for ISC oversight was seen as a direct challenge to Starmer’s authority. Prominent Labour figures, including former shadow chancellor John McDonnell, vowed to rebel against any government amendment that allowed documents to be withheld on vague grounds of international relations. “This is so wide that it opens up the Prime Minister to allegations of collusion in a cover-up,” McDonnell said.

Media commentators were scathing. Broadcaster Andrew Neil suggested that sacking chief of staff Morgan McSweeney, who had championed Mandelson’s appointment, would not be enough to save Starmer’s premiership. Andrew Marr, speaking on LBC, declared, “Too many misjudgments. Too much authority lost. Too little direction. I really see no way back.” Even Labour’s own Health Secretary, Wes Streeting, distanced himself from Mandelson, calling his actions “a gross betrayal of two Prime Ministers, of our country’s national interest, of Epstein’s victims…and of our values.”

Amidst the chaos, the government formally agreed to publish the Mandelson files, with the ISC empowered to vet any redactions on national security grounds. The files are expected to shed light on why Mandelson was appointed, what was known about his ties to Epstein, and the extent of any leaks of sensitive information. The government also confirmed that Mandelson’s actions were “unforgivable,” and that he “lied to the Prime Minister, hid information that has since come to light and presented Jeffrey Epstein as someone he barely knew.”

As the dust settles, the Mandelson affair remains a festering wound for Keir Starmer’s administration. The rebellion may have been quelled for now, but trust between the frontbench and the party faithful has been severely shaken. With a police investigation ongoing, calls for further inquiries, and the files’ full contents yet to be revealed, the scandal’s political and personal ramifications are far from over.