Despite the revelations, Starmer has refused to reveal what checks were carried out on Mandelson before his appointment as ambassador.
Andy McDonald, Labour MP for Middlesbrough and Thornaby East, said: “I fail to see how our ambassador to the US can possibly continue in post”.
“That he continued to engage with the paedophile Epstein after he was indicted is simply staggering.
“If it’s right that in addition he was directly involved in business activity to the advantage of Epstein while he was business secretary, then that raises huge issues.
“If true it is not only unacceptable, it raises questions about whether he complied with the ministerial code.”
He said diplomats had to “command trust and respect both in the nation they are posted to but here at home as well”.
“The Prime Minister has said much about improving standards in public life and I trust he will take advice from the ethics adviser or other such independent person,” he said.
“It seems clear from the information already in the public domain and accepted as being accurate by Peter Mandelson himself, that his time as our ambassador to the US is up.
“Either he does the right thing by stepping down and saves the Prime Minister and the country any further embarrassment. If he does not, he should be fired.”
Kim Johnson, the MP for Liverpool Riverside, said: “As much as [Mandelson] says on radio that he regrets it, the fact is that he called him his ‘best pal’ in his birthday card”.
“That suggests to me a very strong relationship because who sends cards with those comments on? He should never have got it in the first place.”
Bell Ribeiro-Addy, a left-wing challenger for the Labour deputy leadership, said Mandelson should face an investigation by the Prime Minister’s ethics adviser, Sir Laurie Magnus, and resign if he is found to have broken any rules.
“There should definitely be an investigation into it because there will be a huge amount of concern and if the outcome is that he should resign, he should,” she told the i paper.
Asked directly if he should remain in post in Washington DC, she replied: “No ... I think that’s going to disturb quite a few people”.
A fourth backbencher later said Starmer standing by Mandelson “stinks to high heaven”.
Another Labour MP, Richard Burgon, said: “Peter Mandelson should never have been appointed. He should be immediately sacked.”
Ian Byrne was among the Labour backbenchers temporarily stripped of the party whip last year after voting to lift the two-child benefit cap.
Byrne told the Independent: “MPs get suspended by the party like I did for voting against putting children into poverty”.
“But calling the world’s most infamous paedophile and child trafficker ‘your best pal’ among other comments, that’s ok? It stinks to high heaven.”
Nadia Whittome also called for Mandelson to be sacked. The Nottingham East MP wrote on X: “It has long been known that Mandelson remained close to Epstein even after he was convicted of sex offences”.
“He shouldn’t have been appointed in the first place and it is very clear that the Prime Minister must sack him immediately. We either stand with victims or we don’t.”
The growing backlash came after Kemi Badenoch, the Conservative Party leader, called Starmer a “disgrace” for standing by Mandelson at Prime Minister’s Questions yesterday.
She told the Commons: “He says the ambassador has expressed full regret, but the victims of the paedophile Jeffrey Epstein have called for Lord Mandelson to be sacked”.
“And just so the House is aware, in 2019 Jeffrey Epstein was convicted of child prostitution and sex trafficking that took place between 2002 and 2005.
“That is the precise period in which Lord Mandelson called Jeffrey Epstein his ‘best pal’. Was the Prime Minister aware of this intimate relationship when he appointed Lord Mandelson to be our ambassador in Washington?”
Starmer replied: “As she and the House would expect, full due process was followed during this appointment, as it is with all ambassadors. The ambassador has repeatedly expressed his deep regret. He is right to do so. He is now playing an important part in the UK-US relationship.”
When Badenoch pushed him to publish all vetting files relating to Mandelson’s appointment, the Prime Minister declined, saying: “Full due process was gone through in relation to this appointment, as would be expected”.
“As for the publication of documents, that’s subject to a procedure which includes an independent element. It will be subject to the usual procedure.”
The Tory leader challenged Starmer further over Mandelson’s position in light of a Telegraph investigation that found a £1b deal involving a taxpayer-owned banking business was negotiated while Mandelson was business secretary and only months after Epstein had been released from prison.
Sempra Commodities, a joint venture between the taxpayer-owned Royal Bank of Scotland (RBS) and Sempra Energy, was sold to JP Morgan in a deal on which Epstein gave advice to both Mandelson and to Jes Staley, a senior executive with JP Morgan, who has since been banned from the City over his relationship with the disgraced financier.
Badenoch said: “The Daily Telegraph reports today that while Lord Mandelson was business secretary, he brokered a deal with Jeffrey Epstein, and that this occurred after Epstein had been convicted of child sex offences.
“Given this new information, does the new Prime Minister really think it is tenable for our new ambassador to remain in post?”
Starmer was heckled with “answer the question” as he replied: “The relationship between the US and the UK is one of our foremost relationships and I have confidence in the ambassador in the role that he is doing”.
The exchange, during Prime Minister’s Questions, came hours after Mandelson confessed that more “very embarrassing” details of his friendship with Epstein will come out in the future.
Mandelson has been hailed as a key part of the success of Starmer’s relationship with Donald Trump, the US President, who is due to visit the United Kingdom next week.
Trump has spoken warmly of the Prime Minister despite their differing political beliefs and agreed to a UK-US trade agreement that came into effect over the summer.
Epstein was found dead in his cell at a federal jail in Manhattan in August 2019 while he awaited trial on sex-trafficking charges. The death was ruled a suicide.
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