Keir Starmer Refuses to Resign After Scottish Labour Leader Anas Sarwar Demands Exit Over Peter Mandelson’s Epstein Ties

Labour leadership crisis

Prime Minister Sir Keir Starmer refused to resign after Scottish Labour leader Anas Sarwar publicly demanded his exit over the appointment of Lord Peter Mandelson as UK ambassador to Washington amid fresh disclosures linked to Jeffrey Epstein. Sarwar became the most senior Labour figure to call for Starmer's departure, saying the 'distraction needs to end,' and the demand came as Starmer lost a second senior aide in two days, intensifying pressure on his leadership. Downing Street said Starmer would address MPs and defended the government's continuity while senior figures sought to calm rank-and-file anger at a packed Parliamentary Labour Party meeting where the prime minister declined to step down.

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Mandelson and Epstein ties

The immediate trigger for the crisis is newly published U.S. Department of Justice files and related reports alleging Lord Peter Mandelson maintained closer ties with Jeffrey Epstein than he had admitted and may have passed market-sensitive government information to him around the 2008 financial crisis.

U.S. documents and reporting cite specific examples, such as a December 2009 note about changing a planned bankers’ bonus tax and a forwarded internal briefing marked 'gone to the PM', and the Metropolitan Police have searched two properties as part of an inquiry into possible misconduct in public office.

Mandelson has been sacked from an ambassadorial role, resigned from the House of Lords, and has denied knowledge of Epstein’s crimes even as he faces police scrutiny.

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No.10 resignations and fallout

The political fallout included multiple senior departures at No.10: Morgan McSweeney resigned after saying his advice to appoint Mandelson was wrong and taking full responsibility. Tim Allan, the director of communications, also quit, and deputies were named as joint acting chiefs of staff. The resignations prompted fierce criticism from opposition parties and some Labour backbenchers, intensified debate about vetting and judgement in Downing Street, and produced warnings that the episode is the gravest challenge of Starmer’s 18-month premiership.

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Labour leadership turmoil

The row has split narratives inside and outside Labour: Scottish leader Anas Sarwar demanded Starmer’s resignation, saying it was necessary to stop a damaging distraction ahead of critical devolved elections. Many cabinet ministers publicly rallied to the prime minister and vowed unity.

Starmer apologised to Epstein’s victims for 'having believed Mandelson’s lies,' pledged to publish documents about the appointment, and insisted he would 'fight on' despite calls from opposition figures including Conservative leader Kemi Badenoch and Reform’s Nigel Farage. The political calculus remains unsettled, with some senior figures privately distancing themselves while others defended Starmer, producing an uneven public picture of support.

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Scrutiny over Mandelson appointment

Beyond personalities, the episode has prompted institutional steps and scrutiny. The Foreign Office is reviewing a reported exit payment to Mandelson. The government has pledged to publish tens of thousands of emails and records about the appointment, while vetting some material for national security.

The Metropolitan Police’s inquiries continue. All of these actions leave factual gaps and timelines still contested in reporting.

Some outlets report a review of a reported £38,750–£55,000 exit payment, while others present divergent timelines about when Mandelson was removed or when aides were appointed. Those ambiguities will only be clarified once the promised documents are released and police work concludes.

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