Peter Mandelson, the UK ambassador to the US, has been sacked from his role as scrutiny builds over his relationship with disgraced financier Jeffrey Epstein.

The diplomat’s most famous quotation sums up his attraction to the rich and famous and his fondness for the trappings of wealth.

“We are intensely relaxed about people getting filthy rich,” he told tech executives when he was Sir Tony Blair’s trade and industry secretary in 1998.

“As long as they pay their taxes,” he added hurriedly, the former spin doctor known as the “Prince of Darkness” acutely aware of the risk of damaging headlines.

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Now, less than nine months after his controversial appointment by Sir Keir Starmer as UK ambassador, his association with convicted sex offender Epstein suggests once again that he appears unable to avoid scandal.

Aged 71, Lord Mandelson – awarded a peerage by Gordon Brown in 2008 – had to resign from Sir Tony’s cabinet twice, first over an undeclared bank loan and then over intervening in a passport application by a top Indian businessman.

Over four decades, nearly all on the front line of British politics, he has been a consummate political networker, but he has also been one of the most divisive figures in public life and his appointment last December was seen by critics as an act of cronyism by Sir Keir.

Acknowledging that Lord Mandelson was a controversial and divisive figure, Sir Tony declared in 1996: “My project will be complete when the Labour Party learns to love Peter Mandelson.”

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The Washington role is seen as the most glittering and important diplomatic post in the UK government. The perks of the job include the luxurious ambassador’s residence in Massachusetts Avenue, a magnificent Queen Anne mansion designed by top architect Sir Edwin Lutyens.

When he appointed him as ambassador, Sir Keir saw Lord Mandelson as a skilful and persuasive link to the president, with his trade experience from his time as a cabinet minister and Brussels commissioner a vital qualification for the job.

Never one for false modesty, Lord Mandelson claims that when he first walked into the Oval Office the president said to him: “God, you’re a good-looking fellow, aren’t you?”

Lord Mandelson can be credited with several diplomatic triumphs in Washington. He played a vital role in ensuring the UK escaped the worst of Trump’s tariffs and he was instrumental in securing a much sought-after trade deal between the UK and the US.

And his silky PR skills were displayed when during Sir Keir’s first visit to the White House in February the PM theatrically pulled out of his inside pocket a letter from King Charles inviting the present to visit the UK.

It was a classic Lord Mandelson stunt and confirmed he’d lost none of the flair for presentation he’d first deployed when he was Labour leader Neil Kinnock’s spin doctor in the 1980s.

Lord Mandelson’s high-profile political career began as a TV producer until his appointment as Labour’s director of communications under Neil Kinnock in 1985.

He was seen as a brilliant if ruthless spin doctor, who masterminded the birth of New Labour but would berate newspaper editors when unfavourable stories were written by their political journalists.

Another classic Lord Mandelson attempt to kill an embarrassing story was to tell the journalist who wrote or broadcast it in a sneering voice: “That is a story that I believe will remain an exclusive.”

He became MP for Hartlepool in 1992 and helped propel Sir Tony to the leadership of the party after John Smith’s death in 1994, a move that led to a bitter feud with Mr Brown.

There’s an amusing story about Mandelson in Hartlepool, which he claims is a myth and blames Mr Kinnock for. It’s claimed he ordered “some of that delicious guacamole” in a fish and chip shop, mistaking mushy peas for avocado dip.

It was a perfect Lord Mandelson story, ridiculing his metropolitan tastes and ignorance of working-class life. But he claims the mistake was made by a young American woman student who was helping Labour’s campaign.

His first cabinet job, trade and industry secretary in 1998, lasted only five months after he was forced to quit after failing to declare a home loan from Labour millionaire Geoffrey Robinson to his building society.

His resignation was similar in one respect to the demise of former deputy prime minister Angela Rayner last week, in that it was over irregularities in buying a property: in Hove in her case, in fashionable Notting Hill in his.

He bounced back as Northern Ireland secretary in 1999 and was said to enjoy the luxury of Hillsborough Castle, which went with the job. But he was forced to resign a second time over claims he helped businessman Srichand Hinduja with an application for UK citizenship.

When he held his seat in Hartlepool in the 2001 general election, Mandelson made a passionate and defiant victory speech at his count in which he declared: “I’m a fighter, not a quitter.”

Yet three years later he did quit as an MP, when he became a trade commissioner in Brussels, serving a four-year term during which he had a spectacular row with French president Nicolas Sarkozy, who accused him of selling out French farmers in trade talks.

There were more controversies arising from his time in Brussels. In 2006, it was reported that he received a free cruise on a yacht from an Italian mogul who was said to have benefited from tariffs on Chinese shoes when Mandelson was EU trade commissioner.

Reports also claimed he had been lent a private jet by banking and business tycoon Nat Rothschild. And it was later reported that he had a holiday in August 2008 on the yacht of Russian oligarch Oleg Deripaska off the Greek island of Corfu.

Mr Deripaska was said to have benefited from a cut in EU aluminium tariffs introduced by Mandelson. But prime minister Brown said Mandelson’s dealings with Mr Deripaska had been “found to be above board”.

After Brussels came perhaps his most spectacular and unexpected political comeback, when in 2008 his old foe Gordon Brown, by now prime minister but facing challenges to his leadership, brought him back as business secretary with a peerage.

A year later, Mr Brown awarded him the grand title, previously held by Michael Heseltine under John Major, of first secretary of state, a position he held until Labour’s election defeat in 2010.

To this day, Lord Mandelson remains a devoted Blairite rather than a soulmate of Mr Brown. And in the run-up to Sir Keir’s election victory last year he was back in the fold, offering advice on campaigning and policy.

He got his reward with the plum job of ambassador in Washington. But his links to a very American scandal, involving the disgraced financier and sex offender Epstein, have pushed him out of political life. Again.

Peter Mandelson’s position was completely unsustainable, but it took Sir Keir Starmer 24 hours after everybody else to realise the inevitable.

In the chaotic interim, this generated the extraordinary spectacle of No10 saying that they had full confidence in their man in Washington because – and it feels incredible to type this – No10 had been fully aware that the peer had an extended relationship with a convicted paedophile after the point he had been to jail in the US, and was content with this situation.

An incredible state of affairs.

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This is why the issue has become a matter of Starmer‘s judgement almost as much as Peter Mandelson‘s.

Indeed, there were echoes here of the Chris Pincher affair that led to Boris Johnson’s downfall – a leader stubbornly defending acts which revolted the bulk of the party, in a tone deaf act of self-harm.

And revolted, they were.

Almost the entire Labour Party was reacting with horror at the revelation, and even more so at the defence.

Less than 24 hours before his departure, Starmer was saying: “The ambassador has repeatedly expressed his deep regret for association with him, he’s right to do so. I have confidence in him and he’s playing an important role in the UK-US relationship.”

Words of certainty – but done once again without access to full facts.

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Dangerously, the PM was also defending a vetting process which would by implication put him in possession of facts that should have ruled Mandelson out of that job.

“Full due process has gone through when the appointment was made,” he said.

Now the line from a junior foreign office minister is that Mandelson hadn’t told him. So either the vetting failed or this isn’t quite accurate.

My understanding is that no one in government knows the last time Mandelson did see Epstein – the absence of certainty on that key fact must have set off alarm bells.

Right now, No10 will be thinking and hoping that, with just six days to go until the state visit by Donald Trump, which was meant to be organised by Mandelson, people will not focus too much on this question.

However, given the current rate of one big beast in government being sacked every week, this will ultimately land at Starmer’s feet.

Labour’s deputy leadership contest is on the brink of becoming a two-horse race between Bridget Phillipson and Lucy Powell, as the other three candidates scramble for nominations.

The official tally from the Parliamentary Labour Party (PLP) on Wednesday night put Ms Phillipson, the education secretary, ahead with 116 nominations.

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Ms Powell, the former Commons leader who was ousted in Sir Keir Starmer’s reshuffle last week, is behind with 77 – just three shy of the 80 needed to make it to the next round.

Bell Ribeiro-Addy, Paula Barker and Dame Emily Thornberry all had support from 15 or fewer MPs as of Wednesday evening, fuelling speculation they could follow in the footsteps of housing minister Alison McGovern and pull out.

Ms Barker, the MP for Liverpool Wavetree, told Sky News she was “genuinely undecided” and had a lot to consider.

Ms Barker, a former trade union official, has challenged the government on Gaza and welfare cuts and is part of the newly formed soft-left “Mainstream group”.

Her allies are keen for her to stay in the race, with one telling Sky News she “outshone the others by miles” during an online hustings event for MPs, and would be a “real alternative for the membership”.

Her supporters are expected to throw their weight behind Ms Powell if she does drop out, with one saying of the Manchester Central MP: “She is closer to Andy Burnham, and she was just sacked, so those who dislike Morgan McSweeney [the prime minister’s chief of staff] I guess will get behind her.”

However, while describing her as “slightly more left” than Ms Phillipson, they said she is “hardly a socialist”.

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Some MPs want to avoid a race between Ms Powell and Ms Phillipson, believing there is not much difference in what they offer, but others had more praise for the former, calling her performance at the hustings impressive.

One MP said: “Her pitch is that she’s been the shop steward of the parliamentary Labour Party (PLP) in government, but now she’s not in government she can dedicate herself to the role of deputy leader full time without a department to run. She wants to focus on defining our voter coalition and making sure we’re speaking to them.”

They added that Ms Phillipson might be too busy to fulfil the deputy leadership role, especially with SEND (special educational needs and disabilities) reform coming down the track “which could be a horror show”.

Ms Phillipson has been making the case to MPs about her experience fighting populism in her Houghton & Sunderland South seat in the North East, where Reform UK is on the rise.

Dr Jeevun Sandher said he was won over by the education secretary following her pitch at the hustings in which she also spoke about the cost of living crisis.

The MP for Loughborough told Sky News: “Bridget was strong, articulate, and very impressive. She was able to communicate the deep thought we need to govern well and win the next election.”

The deputy leadership race was triggered by the resignation of former deputy prime minister and housing secretary Angela Rayner after she admitted underpaying stamp duty on a flat.

The candidates need 80 backers by 5pm Thursday. As of Wednesday evening’s tally, 235 MPs had made their nominations out of Labour’s 398 MPs.

Ms McGovern pulled out on Wednesday afternoon, saying it was “clear that the momentum of this contest had shifted, and I am not going to progress to the next stage”.

The MP for Birkenhead was rumoured to be Number 10’s preference before it was clear Ms Phillipson – who she has since nominated – would enter the race.

Timeline for the race

Many Labour MPs are keen to see someone who would work constructively with the prime minister to avoid the party becoming more divided.

There are also calls for the deputy leader to be from the north to balance out the number of cabinet ministers who represent London seats – which both Dame Emily and Ms Riberio-Addy do.

If more than one candidate secures 80 nominations by Thursday evening, they will then need to gain backing from either three of Labour’s affiliate organisations, including two trade unions, or 5% of constituency parties.

That process will continue until 27 September, meaning a contested election threatens to overshadow the party’s annual conference that begins in Liverpool the next day.

The successful candidates will then appear on the ballot for a vote of all party members and affiliated party supporters, which will open on 8 October and close on 23 October at 12pm.

The winner will be announced on Saturday 25 October.