Sir Keir Starmer has admitted he was “wrong” to appoint Peter Mandelson as US ambassador in a fresh Commons showdown where he insisted he was not told the disgraced Labour peer had failed security vetting.
The Prime Minister was accused of misleading MPs and breaching the ministerial code over the scandal as he faced calls to resign on Monday.
An emergency debate is set to be held in the Commons on Tuesday after Sir Keir claimed he was not told Lord Mandelson, who had a close relationship with paedophile financier Jeffrey Epstein, had failed security vetting.
Sir Keir on Monday disclosed further details of the appointment process saying it “beggars belief” that he was not told about the peer failing security checks and pinning the blame on Foreign Office civil servants.
He acknowledged that the MPs listening would find the claims “to be incredible”, prompting jeers from the opposition benches, and admitted he had inadvertently misled parliament.
Sir Keir said: “I want to be very clear with the House that, while this statement will focus on the process surrounding Peter Mandelson's vetting and appointment, at the heart of this, there is also a judgement I made that was wrong.
“I should not have appointed Peter Mandelson. I take responsibility for that decision.
“I apologise again to the victims of the paedophile Jeffrey Esptein who were clearly failed by my decision.”
Sir Keir said that UK Security Vetting's recommendation that Lord Mandelson should not be given developed vetting (DV) status “could and should have been shared with me,” adding that had he known there was concerns, he would “not have gone ahead with the appointment.”
The scandal has fueled further calls for Sir Keir to resign, both from opposition parties but also from critics within the Labour movement who already fear an electoral bloodbath in May's local elections.
Tory leader Kemi Badenoch said: "Downing Street admitted that the Prime Minister inadvertently misled the House.
“The Prime Minister has chosen not to repeat that from the despatch box.”
The Prime Minister has insisted he was only informed about the vetting issue on Tuesday evening after the information was uncovered as part of the process of gathering files related to Lord Mandelson's appointment to comply with an order by MPs to release all relevant documents.
Allies of the Prime Minister insisted that today was the first opportunity he has had to set out the full facts to Parliament, despite appearing in the Commons on Wednesday for his regular question time session.
But Ms Badenoch said: “This is a breach of the ministerial code. Under that code, he is bound to be as open as possible with parliament.”
She added that the government has not published exactly why Lord Mandelson failed vetting and therefore "we do not know what risks our country was exposed to".
The Foreign Office's top official Sir Olly Robbins was last week effectively fired by Sir Keir after it emerged Lord Mandelson had been given DV status despite failing checks.
The Prime Minister's blamed officials for not telling him, or the then foreign secretary David Lammy, that UK Security Vetting (UKSV) had not cleared the peer.
Lord Mandelson was sacked last year, just nine months into the Washington DC posting, after further details of his association with Epstein emerged, a relationship which was widely known about before his appointment.
Whitehall veteran Sir Olly is expected to give his own account of the events to MPs on Tuesday at the Foreign Affairs Committee.
Scottish Secretary Douglas Alexander said on Monday morning that he expected Sir Keir to survive to lead Labour into the next general election "but there are no certainties" in politics.
A statement issued by No 10 on Sunday night said that although civil servants rather than ministers make decisions on vetting and clearance, there was nothing in the law to prevent ministers being told.
"There is nothing in the guidance which prevented information being shared in this scenario, in a proportionate and necessary way and subject to the appropriate procedural steps," the statement on the Constitutional Reform and Governance Act said.
While there are "legal obligations" under data protection rules, "no law prevents civil servants - while continuing to protect such sensitive personal information - from sensibly flagging UK Security Vetting recommendations or high level risks and mitigations".
UKSV's privacy notice sets out there are "limited circumstances in which relevant vetting information can be shared" if "a security risk has been identified".
