Peter Mandelson initially demanded more than half a million pounds as a severance payment after being dismissed as US ambassador.
The first release of the “Mandelson files” – government documents and correspondence relating to the disgraced peer’s appointment as US ambassador and subsequent tenure – was published today, after MPs voted last month to force the disclosure.
They reveal that Mandelson’s ties to the paedophile financier Jeffrey Epstein were flagged during the appointment process, including the report that Mandelson stayed in Epstein’s Manhattan property after his conviction for soliciting prostitution from a minor.
Most of the files, however, relate to the negotiations following the termination of Mandelson’s appointment. They reveal that he received a settlement payment of £75,000. According to one email, “He opened negotiations asking us to pay out his contract (over £500k). Mark [Power, chief people officer at the Foreign, Commonwealth and Development Office] did v well to get this settlement down this low with minimal fuss”.
Other emails reveal the Foreign Office assessment that a significant payment is justified given “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”.
Mandelson himself hints at the potential for such a claim, writing on 17 September 2025 about his “employment rights”, including the line: “this will be better understood by lawyers than me”. A week later (24 September 2025) there is a note of a call held with Mandelson. It says that Mandelson “has sought advice, during the conversation he intimated this had been from Senior Counsel (a KC) specialising in employment law. 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.” It could be surmised from this note that Mandelson threatened to go to a tribunal over his dismissal, knowing the reputational damage this could cause to the government.
At the time of these emails and documents, the full extent of Mandelson’s long friendship with Jeffrey Epstein, including the alleged forwarding of confidential government documents when he was business secretary in Gordon Brown’s cabinet and the lobbying he conducted on the financier’s behalf, was not publicly known. Mandelson himself, however, would surely have been aware of what could still come out during the negotiations over his settlement.
[Further reading: John Healey: “There’ll be no repeat of Iraq’s mistakes”]
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