Britannia Radio

Man in the news: Lord Mandelson

By George Parker

Published: June 12 2009 19:06 | Last updated: June 12 2009 19:06

Peter Mandelson on Friday had an audience with the Queen. (Or was it the other way round?) For Lord Mandelson, on the day of his inauguration as Lord President of the Privy Council, it was a rare chance to meet somebody endowed with even more titles than himself.

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In the course of the past few days, Lord Mandelson has acquired so many baubles he is beginning to sound like a character in a Gilbert and Sullivan opera. But behind the ermine and the pomp lies a stark political truth: he has become the most powerful figure in Gordon Brown’s government.

The irony is palpable. Lord Mandelson is the closest political friend of Tony Blair, the former prime minister. Gordon Brown spent the best part of a decade trying to oust Mr Blair from Downing St, creating a poisonous feud at the heart of the Labour government.

Yet on the night of June 4, at Mr Brown’s darkest hour in Downing Street, Lord Mandelson stepped in to quash an incipient cabinet rebellion, declining to adopt the expected role of Lord High Executioner. Hours later an exhausted and grateful prime minister carried out an emergency reshuffle, bestowing power, prestige and a sprawling new economics ministry on his old enemy.

When it came to the crunch, Lord Mandelson, the 55-year-old former EU trade commissioner, made two key calculations. The first was that if Labour ditched Mr Brown, they would have to confront hostile British voters at an early general election, rather than waiting until June 2010 (the last possible moment).

Furthermore, he believed that even if Mr Brown was replaced by the most likely alternative – Alan Johnson, a charismatic ex-postman who once admitted he was not up to being prime minister – Labour’s fortunes would not improve enough to avoid electoral disaster.

The second calculation was personal. By binding himself loyally to a floundering prime minister, he would put himself in a position of immense political power. His new role as “First Secretary of State” makes him de facto deputy prime minister, a job performed in Labour’s postwar government by Herbert Morrison, his grandfather.

Lord Mandelson is now “the most powerful unelected deputy since Henry VIII appointed Cardinal Wolsey, except Cardinal Wolsey was more sensitive in handling his colleagues than the noble Lord Mandelson”, says William Hague, deputy Conservative leader. “It would be no surprise to wake up in the morning and find he had become an archbishop.”

The question is what Lord Mandelson intends to do with that power – and whether he can do anything to turn round Labour’s plummeting fortunes.

Lord Mandelson’s newfound role is all the more remarkable when one considers that last October he was in Brussels, seeing out the dying months of his term as European Union trade commissioner, his domestic political career apparently over. Then Mr Brown stunned the political world by calling him back to the government, in an effort to heal Labour’s factional wounds and bring back the party’s most gifted strategist.

Lord Mandelson is now the dominant figure in Mr Brown’s team, estimating that he will spend about a fifth of his time working in Downing St. That is certain to increase as the election approaches.

He is already revamping the government’s policy and communications effort, although as he has told friends: “You can’t deal with what we have gone through in the last few weeks through better communications.” He also has a small window of opportunity to push forward the modernising policy agenda set out by Tony Blair – often blocked by Gordon Brown during his decade as finance minister. Mr Brown’s uncertain embrace of New Labour policies such as extending choice and using the private sector to deliver public services has irritated Lord Mandelson.

He hopes to use his influence to push forward reforms he believes have stalled. “If you don’t keep pushing them, they go into reverse,” his allies say. He also wants Labour to fight the next election on a pro-European ticket and to pitch its tent firmly on the centre ground.

Yet for all his titles and influence in Downing St, Lord Mandelson remains a strong man in an enfeebled administration.

His new department of business, innovation and skills may boast 11 ministers – perhaps the biggest such line-up in Whitehall history – but Lord Mandelson may not even be able to push through his flagship piece of legislation. This plan, to part-privatise the Royal Mail postal service, is on hold, with the government frightened to bring it to the House of Commons because it knows it will provoke a huge rebellion by Labour MPs.

Lord Mandelson wants to push on with Blairite reforms, but his government is a fractious and uneasy coalition of modernisers and traditionalists, many of whom believe the only way to save their seats at the election is to stir the blood of the party’s core supporters by moving to the left. Many Labour MPs believe the party is doomed to lose the next election, whatever it does.

“We’ve got less than a year to turn things around – we haven’t got any money and we haven’t got much time,” admitted one former cabinet minister.

Nevertheless, Lord Mandelson has emerged from the latest party trauma with his reputation intact. Even if he cannot stop Labour losing the next election, he could be a pivotal figure in determining how it responds to defeat. While once he was seen by many Labour MPs as the “prince of darkness” – a divisive consigliere and spin doctor to Mr Blair – some are now reviewing their opinion, seeing him as a unifying figure in a divided party.

Mr Blair famously said he would know he had succeeded in changing his party when Labour started to love his friend. Geraldine Smith, a Labour MP, acknowledged this truth this week when she said: “A strange thing has happened to me. I think I’m learning to love Peter Mandelson.”

Lord Mandelson of Foy in the county of Herefordshire and Hartlepool in the county of Durham, first secretary of state, secretary of state for business, innovation and skills and Lord President of the Council, says he is not surprised. He smiles: “They are returning my affection. I love them. Why shouldn’t they love me?