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Peter Mandelson: Lobbyist for Union-Busters, Big Banks and Oligarchs

Peter Mandelson's return as an advisor to the Starmer leadership doesn't just drag the party to the right – it also puts a major corporate lobbyist, who represents union-busting Centrica, at the heart of Labour politics.

Peter Mandelson is back at the heart of the Labour machine. Nobody in the party was asked if Mandelson should be given a key role in Labour, or even told exactly what his role is – but he is clearly working closely with Labour’s leadership.

This doesn’t just mean that one of the most controversial New Labour figures is a key member of ‘Team Starmer’: it also means Mandelson, a lobbyist who represents banks, oligarchs, and firms like Centrica—the company behind the mass sacking of British Gas engineers—is helping to direct Labour strategy. For his ‘day job’, Mandelson owns and runs a company that takes Michael Gove to dinner and hires former Tory Ministers; as a hobby, he tells Keir Starmer what to do.

Peter Mandelson was brought back as an ‘informal’ adviser this February by Morgan McSweeney, Starmer’s chief of staff, who reached out to the former New Labour minister as his team began panicking over worsening polls.

Mandelson’s role has been kept deliberately unclear, but he was clearly involved in the failed Hartlepool campaign—despite his protestations otherwise. A Tribune source confirmed just yesterday that Mandelson’s trip to Hartlepool had been pre-arranged with Labour’s leadership, specifically Jenny Chapman, and flagged to party staff in advance. When the plan was queried, Starmer’s office batted away criticisms.

This behind-the-scenes manoeuvring begins to clarify Starmer’s recent botched attempt to use the Hartlepool loss to increase the grip of the Right on Labour’s leadership with a knife-in-the-back shadow cabinet reshuffle. Mandelson says ‘party reform’—meaning reducing democracy and increasing central control—is the number one priority, and his old master Tony Blair is in the New Statesman today arguing the same.

A Personal Political History

But is Mandelson really the advisor you would want consulting on Labour’s disappearing Red Wall vote? He was one of the architects of New Labour, first as Neil Kinnock’s director of communications in the 1990s, then as a minister under Tony Blair.

New Labour took the existing core of the party’s working-class votes for granted because, according to Mandelson, they had ‘nowhere else to go’, while seeking additional support from big business by offering them a low-tax, low-regulation economy. Mandelson was involved in the worst excesses of New Labour, and had to resign twice from cabinet because of murky relations with businessmen.

But Peter Mandelson wanted to go much further than even Blair on squeezing the workers on behalf of big business. In 1995, the Observer got hold of a leaked book proposal from Mandelson, showing he proposed

‘“workfare” programmes for the unemployed and single mothers; no-strike deals in the public sector; major emphasis on private pensions; all schools to be free of local authority control; [and] special courts to deal with anti-social behaviour.’

So Mandelson still has plenty of unfinished business.

He followed his New Labour period with a stint as Chief Election Strategist for Labour in the 2010 election, a grim defeat for the party in which many of the ‘core voters’ taken for granted in the New Labour strategy deserted. Mandelson personally embodies the myth that ‘New Labour’ means ‘vote winner’.

Counsel to the Corporations

But it’s what Mandelson did—and still does—since leaving government that makes his latest Labour role most disturbing. In 2010, Mandelson founded his own ‘advisory’ business, Global Counsel, which he co-owns with his assistant, Ben Wegg-Prosser.

In government, Mandelson told US investors that Labour was ‘intensely relaxed about people getting filthy rich’. By founding a lobbying firm, he seems to have sought to personally join the filthy rich. Global Counsel offers to help corporations ‘see opportunities in politics, regulation and public policy’. He is therefore combining his role as a Labour advisor with a paid job helping big business to get ‘opportunities in politics’.

Unlike most UK lobbying companies, Mandelson’s secretive firm does not voluntarily list their UK clients. However, the stricter European Union lobbying register does show some members of the group: they include the aforementioned Centrica, banking giant Santander, UK Finance—the UK banking lobby group—and the European Round Table for Industry, a lobby group for Europe’s biggest corporations. All these big companies have strong stakes in low taxation and more deregulation, and so, by implication, does Peter Mandelson.

Mandelson’s network is an international one. Global Counsel’s website says the firm ‘advises international clients on Russian market entry, the impact of Russian sanctions and navigating Russian policymaking’. Until June 2017, Mandelson was personally a director of Sistema, an oligarch-owned Russian industrial conglomerate with defence interests. Global Counsel also offers advice on Turkish business and politics, while Mandelson personally is a director of Global Ports Holdings, the Turkish-owned cruise port operator led by tycoon Mehmet Kutman.

And while Mandelson gets free access to Labour’s leadership, his firm spends money to keep up good relations with the Tory government. In 2018, Global Counsel hired former Tory Health Minister Nicola Blackwood as a senior advisor, not least to attract private health firms as clients; this year, the company hired former Tory MP Archie Norman as their vice chairman. Hospitality records also show that Global Counsel took Michael Gove—then Environment Secretary—and his special advisor to dinner in 2019. Typically, Mandelson would be at such events in person—but it isn’t possible to know in this case whether he was.

The baseline of all this is that the owner of a firm that hires, wines, and dines top Tories and helps corporations ‘see opportunities in politics’ is now a top advisor to Labour leader Keir Starmer.

A Lingering Presence

As well as touting advice to corporations, Mandelson is also deeply factional. At a 2017 event, he said ‘I work every single day’ to try undermine then-Labour leader Jeremy Corbyn. Mandelson was deeply involved in the People’s Vote campaign as a director of Open Britain, one of the main organisations behind the push for a second referendum on the EU.

He has subsequently called for Labour to adopt ‘Brexit values’ after its Hartlepool disaster—those are my principles, the saying goes, and if you don’t like them, I have others. Many critics think this was more about finding a way to undermine Corbyn than keep the UK in the EU by creating a big, distracting, and hopeless campaign to tie up the Labour party. Even during the campaign, Mandelson was telling potential clients of his Global Counsel consultancy that Brexit could not be stopped.

The idea that bringing back Mandelson means bringing back New Labour’s ‘winning’ streak shows the naivety at the heart of Starmer’s team. Labour can’t rewind the past. Even Neil Kinnock, who first gave Mandelson a big role in politics, now thinks he is a ‘caricature of himself’.

Instead of a Machiavelli who can help them win, Labour has brought corporate lobbying right into the heart of its political operation—right at the moment it most wants to foreground Tory ‘sleaze.’ Unfortunately, it’s likely Labour will see plenty of its own under this new management.