Stock Markets February 8, 2026

Starmer’s Chief of Staff Resigns Amid Backlash Over Mandelson Appointment

Morgan McSweeney accepts responsibility for recommending Peter Mandelson as US ambassador as controversy deepens

By Avery Klein
Starmer’s Chief of Staff Resigns Amid Backlash Over Mandelson Appointment

Morgan McSweeney, British Prime Minister Keir Starmer’s chief of staff, has resigned after acknowledging his role in recommending Peter Mandelson for the post of ambassador to the United States. The appointment has prompted intense criticism of Starmer’s judgment after files revealed Mandelson’s ties to the late sex offender Jeffrey Epstein, a development now regarded as the biggest crisis of Starmer’s 18 months in office.

Key Points

  • Morgan McSweeney resigned after admitting he advised the appointment of Peter Mandelson as US ambassador.
  • Files showing Mandelson’s relationship with the late sex offender Jeffrey Epstein intensified criticism and amplified the political fallout.
  • The episode affects political institutions and public trust; political stability is being closely monitored by stakeholders.

LONDON, Feb 8 - Morgan McSweeney, the chief of staff to Prime Minister Keir Starmer, announced his resignation on Sunday, saying he had advised the Prime Minister to appoint Peter Mandelson as ambassador to the United States and taking full responsibility for that advice.

McSweeney, who is described as Starmer’s closest adviser and credited by many as one of the architects of the Prime Minister’s victory in Britain’s July 2024 election, said the appointment was a mistake and that it had caused serious harm.

In a statement posted on X by political correspondents, McSweeney wrote: "The decision to appoint Peter Mandelson was wrong. He has damaged our party, our country and trust in politics itself." He added: "When asked, I advised the Prime Minister to make that appointment and I take full responsibility for that advice."

The resignation follows mounting pressure on Starmer after documents surfaced showing the extent of Mandelson’s relationship to the late sex offender Jeffrey Epstein. Those revelations have intensified scrutiny of the decision to send Mandelson to Washington in 2024 and are being characterised by many as the most significant crisis the Prime Minister has faced during his 18 months in power.

McSweeney’s departure marks a notable shake-up within the Prime Minister’s inner circle at a moment when the government is dealing with reputational damage tied to a high-profile diplomatic nomination. The statement made by McSweeney attributes responsibility for the recommendation to him personally, while highlighting the broader consequences he says the appointment has had for public trust.

As the fallout continues, the resignation may prompt further questions about decision-making processes within the Prime Minister’s office and the political calculations behind senior diplomatic appointments. At the time of his statement, McSweeney framed his resignation as an acknowledgement of his role in a choice he now considers wrong.


Key points

  • Morgan McSweeney has resigned as chief of staff after admitting he advised the Prime Minister to appoint Peter Mandelson as US ambassador.
  • The appointment sparked intense criticism after files revealed the extent of Mandelson’s relationship with the late sex offender Jeffrey Epstein, prompting a political crisis for Starmer.
  • Sectors potentially affected include political institutions and public trust in governance; markets sensitive to political stability may watch developments closely.

Risks and uncertainties

  • Continued political fallout for the Prime Minister as the controversy over the ambassadorial appointment unfolds - this primarily affects political institutions and public confidence.
  • Potential reputational damage to the governing party stemming from the revealed links between Mandelson and Jeffrey Epstein - an uncertainty for party standing and voter trust.

Risks

  • Ongoing political damage to the Prime Minister and governing party as scrutiny over the appointment continues - impacts political institutions and voter confidence.
  • Reputational harm linked to revelations about Mandelson’s relationship with Jeffrey Epstein, creating uncertainty about future diplomatic nominations.

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