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Mandelson to return to government Mandelson to return to government
(41 minutes later)
Peter Mandelson has been drafted back into government in a surprise move, as Gordon Brown reshuffles his cabinet.Peter Mandelson has been drafted back into government in a surprise move, as Gordon Brown reshuffles his cabinet.
Mr Mandelson, who was twice forced to resign from Tony Blair's cabinet, has been made business secretary with a seat in the House of Lords.Mr Mandelson, who was twice forced to resign from Tony Blair's cabinet, has been made business secretary with a seat in the House of Lords.
Business Secretary John Hutton replaces Des Browne at defence and Geoff Hoon replaces Ruth Kelly at transport.Business Secretary John Hutton replaces Des Browne at defence and Geoff Hoon replaces Ruth Kelly at transport.
Labour veteran Margaret Beckett returns to cabinet while Ed Miliband is to head up a new climate and energy department.Labour veteran Margaret Beckett returns to cabinet while Ed Miliband is to head up a new climate and energy department.
Defence Secretary Mr Browne is to leave the government, the BBC has learned. He was offered another job but he felt it would be an insult to the armed forces to leave as defence secretary but take another job.Defence Secretary Mr Browne is to leave the government, the BBC has learned. He was offered another job but he felt it would be an insult to the armed forces to leave as defence secretary but take another job.
Mandelson rowMandelson row
Former foreign secretary Mrs Beckett, one of the most experienced Labour figures having served as acting leader after John Smith's death and with a career dating back to the 1974-9 Labour government, returns to the government.Former foreign secretary Mrs Beckett, one of the most experienced Labour figures having served as acting leader after John Smith's death and with a career dating back to the 1974-9 Labour government, returns to the government.
CABINET MOVES Peter Mandelson to businessMargaret Beckett to returnGeoff Hoon to transportDes Browne to leaveEd Miliband to climate/energyJohn Hutton to defence href="/1/hi/uk_politics/7648551.stm">Latest: Cabinet reshuffle class="" href="/1/hi/uk_politics/7650195.stm">Profile: Peter Mandelson CABINET MOVES Peter Mandelson to businessMargaret Beckett to returnGeoff Hoon to transportDes Browne to leaveEd Miliband to climate/energyJohn Hutton to defence href="/1/hi/uk_politics/7648551.stm">LIVE TEXT - Cabinet reshuffle
She may be given a "cabinet enforcer" role while former cabinet minister Nick Brown is also expected to return as chief whip, to replace Mr Hoon.She may be given a "cabinet enforcer" role while former cabinet minister Nick Brown is also expected to return as chief whip, to replace Mr Hoon.
In another surprise move, a new department of energy and climate will be created, to be headed by former Cabinet Office minister Ed Miliband.In another surprise move, a new department of energy and climate will be created, to be headed by former Cabinet Office minister Ed Miliband.
Northern Ireland Secretary Shaun Woodward and Environment Secretary Hilary Benn are expected to remain in their current posts - as are those in the top jobs, chancellor, home secretary and foreign secretary.Northern Ireland Secretary Shaun Woodward and Environment Secretary Hilary Benn are expected to remain in their current posts - as are those in the top jobs, chancellor, home secretary and foreign secretary.
The reshuffle is taking place after the announcement that Ms Kelly is to stand down to spend more time with her family. Trade minister Lord Jones has also said he wants to step down.The reshuffle is taking place after the announcement that Ms Kelly is to stand down to spend more time with her family. Trade minister Lord Jones has also said he wants to step down.
Controversial figureControversial figure
Sources have told the BBC the reshuffle is not merely a "tidying up exercise" but an attempt to reconfigure government to tackle the economic crisis.Sources have told the BBC the reshuffle is not merely a "tidying up exercise" but an attempt to reconfigure government to tackle the economic crisis.
This is an extraordinary step backwards into the worst elements of the Blair era, to reinstate possibly the most divisive figure in Labour's recent history John McDonnellLeft wing Labour MP Browne quits cabinetBusiness welcomes Mandelson return This is an extraordinary step backwards into the worst elements of the Blair era, to reinstate possibly the most divisive figure in Labour's recent history John McDonnellLeft wing Labour MP CPS:LINK HREF="" ID="7650195" STYLE="rightarrow">Profile: Peter Mandelson Browne quits cabinetBusiness welcomes Mandelson return
There have been tensions between Mr Brown and Mr Mandelson for years, since the two men fell out when Mr Mandelson backed Tony Blair for the Labour leadership in 1994.There have been tensions between Mr Brown and Mr Mandelson for years, since the two men fell out when Mr Mandelson backed Tony Blair for the Labour leadership in 1994.
But at the height of a row between Mr Mandelson and French President Nicholas Sarkozy over international trade talks this summer, the prime minister backed the trade commissioner, saying he was doing "excellent work".But at the height of a row between Mr Mandelson and French President Nicholas Sarkozy over international trade talks this summer, the prime minister backed the trade commissioner, saying he was doing "excellent work".
Mr Mandelson's appointment will be seen as a gamble, according to the BBC's James Landale.Mr Mandelson's appointment will be seen as a gamble, according to the BBC's James Landale.
Mr Brown will be keen to draw on his global finance experience gained during his four years as EU trade commissioner.Mr Brown will be keen to draw on his global finance experience gained during his four years as EU trade commissioner.
'A masterstroke''A masterstroke'
But he has been a controversial figure, resigning twice from cabinet posts - once over a loan from his ministerial colleague Geoffrey Robinson and once over allegations of misconduct over a passport application for the Hinduja brothers. An inquiry later cleared him of wrongdoing over the Hinduja affair.But he has been a controversial figure, resigning twice from cabinet posts - once over a loan from his ministerial colleague Geoffrey Robinson and once over allegations of misconduct over a passport application for the Hinduja brothers. An inquiry later cleared him of wrongdoing over the Hinduja affair.
Derek Draper, a former advisor to Mr Mandelson, said the fact the former Hartlepool MP, "the most Blairite Labour figure," and Nick Brown - a close ally of the PM - were both being brought in showed "the Labour Party getting its act together".Derek Draper, a former advisor to Mr Mandelson, said the fact the former Hartlepool MP, "the most Blairite Labour figure," and Nick Brown - a close ally of the PM - were both being brought in showed "the Labour Party getting its act together".
Derek Draper: 'It's absolutely fantastic news for the Labour party'Derek Draper: 'It's absolutely fantastic news for the Labour party'
Former home secretary David Blunkett told Sky News it was a "masterstroke".Former home secretary David Blunkett told Sky News it was a "masterstroke".
But left wing Labour MP John McDonnell said he was "absolutely gobsmacked": "This is an extraordinary step backwards into the worst elements of the Blair era, to reinstate possibly the most divisive figure in Labour's recent history."But left wing Labour MP John McDonnell said he was "absolutely gobsmacked": "This is an extraordinary step backwards into the worst elements of the Blair era, to reinstate possibly the most divisive figure in Labour's recent history."
However backbencher Graham Stringer, one of the rebel MPs who had called for a leadership challenge, told the BBC, that the cabinet had "lacked experience" over the past 12 months.However backbencher Graham Stringer, one of the rebel MPs who had called for a leadership challenge, told the BBC, that the cabinet had "lacked experience" over the past 12 months.
"I think bringing back Margaret Beckett, bringing back Peter Mandelson - not talking about them individually - but it does bring more weight and balance to the cabinet," he said."I think bringing back Margaret Beckett, bringing back Peter Mandelson - not talking about them individually - but it does bring more weight and balance to the cabinet," he said.
Business ambassadorBusiness ambassador
The BBC's Europe editor Mark Mardell says EU Commission president Jose Manuel Barroso has been talking to the prime minister about Mr Mandelson's replacement.The BBC's Europe editor Mark Mardell says EU Commission president Jose Manuel Barroso has been talking to the prime minister about Mr Mandelson's replacement.
In a separate development, Sir John Bond, the chairman of Vodafone, is to become a "business ambassador" for the government.In a separate development, Sir John Bond, the chairman of Vodafone, is to become a "business ambassador" for the government.
HAVE YOUR SAYBrown has lost his marbles if he thinks that bringing Mandelson back will give him credibility Tim, WirralSend us your commentsHAVE YOUR SAYBrown has lost his marbles if he thinks that bringing Mandelson back will give him credibility Tim, WirralSend us your comments
Mr Brown's press secretary and special adviser for media affairs, Damian McBride, is to to take a "more back room role" and will no longer speak to the media on the government's behalf. Government officials stress it was his decision.Mr Brown's press secretary and special adviser for media affairs, Damian McBride, is to to take a "more back room role" and will no longer speak to the media on the government's behalf. Government officials stress it was his decision.
For the Liberal Democrats, Danny Alexander said the prime minister was "deluded" if he thought appointing Mr Mandelson would persuade voters he had what it takes to govern the country.For the Liberal Democrats, Danny Alexander said the prime minister was "deluded" if he thought appointing Mr Mandelson would persuade voters he had what it takes to govern the country.
"Resurrecting ex-ministers from the political graveyard is not going to breathe new life into Gordon Brown's zombie government," he said."Resurrecting ex-ministers from the political graveyard is not going to breathe new life into Gordon Brown's zombie government," he said.