LABOUR grandee Peter Mandelson should repay the £75,000 in public money he was given as a pay-off after being fired as US ambassador, the Scottish Secretary has said.
Speaking to the media while in Paisley to announce the UK Government’s Scotland defence growth deal, Douglas Alexander said he would “urge” Mandelson to hand back the cash which files published the previous day showed he had been given.
On Wednesday, the Labour Government published the first tranche of files related to the decisions to appoint both Mandelson to the top diplomatic posting in Washington and to fire him over his long-running friendship with the paedophile billionaire Jeffrey Epstein.
READ MORE: 8 bombshell revelations from the Mandelson files
The documents showed that the Labour peer had asked for £547,000 – the equivalent of the remainder of the wages for his contract period – after being removed from the US ambassador role, and had eventually been given £75,000.
They also showed that Prime Minister Keir Starmer had ignored warnings in order to give Mandelson the job, including from national security adviser Jonathan Powell, who called the appointment process “weirdly rushed”.
The news has led both to calls for Starmer to resign as Prime Minister and for Mandelson to pay back the public money.
Asked if he believed the £75,000 should be handed back, the Scottish Secretary said: “Yes, I would urge him to do so, whether that's to charities or to others working in the area of the exploitation of women.
“We need to recognise that the primary victims in this instance, and the people who were most betrayed, were the victims of Jeffrey Epstein's crimes.”
Cabinet Office minister Nick Thomas-Symonds on Thursday also said Mandelson should repay the cash, but argued that the £75,000 payment had been "value for money".
On Wednesday, SNP Westminster leader Stephen Flynn accused Starmer of prioritising “Labour Party politics over the interests of Epstein’s victims” in his decision to appoint Mandelson.
Flynn said it was a “failure of judgement that will rightly haunt his last days in Downing Street”.
He went on: “It is now clear beyond doubt that the Prime Minister was warned about the close relationship that Peter Mandelson maintained with Jeffrey Epstein, the world’s most notorious paedophile, after his conviction but chose to appoint him anyway.
“The fact that the Labour Government then paid Mandelson a £75,000 taxpayer-funded golden goodbye adds insult to injury.
READ MORE: Peter Mandelson’s £75,000 payout after sacking was ‘value for money’, argues minister
"A shadow of scandal followed Peter Mandelson every day of his career – the very same shadow of scandal is now a permanent stain on this UK Labour Government."
In a letter to the Ethics and Integrity Commission’s chair Doug Chalmers, the Prime Minister pledged to “go further to strengthen standards in public life”.
He wrote: “While the specifics of the case are now a matter for the police, this scandal has rightfully led many to reflect on our systems, infrastructure, and processes for upholding standards more broadly.”
Mandelson was sacked as US ambassador in September 2025 and then arrested on February 23 on suspicion of misconduct in public office, having been accused of passing sensitive information to Epstein during his time as business secretary (from 2008 to 2010). Epstein was first convicted on child sex offences in 2008.
Mandelson was subsequently bailed, before later being released from his bail conditions, although he remains under investigation.
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