Downing Street has released a readout of what they say Starmer told cabinet members this morning.

The prime minister is said to have told them that Lord Mandelson had "let the country down" and repeated his earlier call for him to no longer be a member of the House of Lords or use his title.

You can see that readout in full below:

The prime minister opened cabinet by addressing recent developments relating to Peter Mandelson.

The prime minister said he was appalled by the information that had emerged over the weekend in the Epstein files.

He said the alleged passing on of emails of highly sensitive government business was disgraceful, adding that he was not reassured that the totality of the information had yet emerged.

The prime minister told cabinet that Peter Mandelson should no longer be a member of the House of Lords or use the title and said that he had asked the cabinet secretary to review all available information regarding Mandelson's contacts with Jeffrey Epstein during his time serving as a government minister.

He said he had made it clear the government would cooperate with the police in any inquiries they carried out. But he said the government had to press and go further, working at speed in the Lords, including legislatively, if necessary.

He reiterated that there was a need to move at pace. The prime minister said Peter Mandelson had let his country down. He added the public don't really see individuals in this scandal, they see politicians.

For the public to see politicians saying they can't recall receiving significant sums of money or not was just gobsmacking - causing them to lose faith in all politicians and weaken trust still further.

The prime minister said that was why moving quickly in this matter was vital. The prime minister then invited the leaders of the Commons and the Lords to update on business in both Houses, including the second reading of the Two Child Limit Bill. 

Turning to China and Japan, the prime minister said his visit had been a very successful trip, thanking the business secretary, chancellor and economic secretary to the Treasury for their involvement in preparations. 

He said the attitude of previous governments was to turn Britain's back on the world and that was how we were perceived abroad.

He added this government was determined to turn that around and be influential again.

That was reflected in our reset relationships with the US and the EU, trade deals with India and South Korea and now reengagement with China.

The prime minister noted he was the first in eight years to visit China, adding that there was no difficult issue that he did not address whilst visiting, while taking advantage of the opportunities available.

The prime minister pointed to several immediate achievements from the trip, including the halving of whisky tariffs, closer cooperation on small boats and that sanctions would no longer apply to Parliamentarians.

He added the visit to Japan was also a success, pointing to the close relationship between the two countries and desire for further investment.

The business secretary described the visit to China and Japan as a first stop in their relationship, laying the foundations for the future.

Government officials are drafting legislation to strip Lord Mandelson of his peerage, the prime minister's official spokesperson has said.

The spokesperson says the government is prepared to legislate to kick Mandelson out of the House of Lords if needed.

Yesterday, the government said Mandelson should no longer be a member of the Lords and should no longer use his peerage - but that doing so would require an Act of Parliament.

The PM's spokesperson said Sir Keir Starmer had told his cabinet this morning that the government had to go further in the Lords, "including legislatively if necessary".

The spokesperson also said they will publish proposals as soon as possible on the broader need to "remove transgressors" more quickly from the Lords.

Starmer also told his cabinet he was "appalled" by the revelations that have emerged over the weekend, and that Mandelson had "let the country down".

"Moving quickly in this matter is vital," Starmer told his cabinet.

Mandelson could also resign from the Lords - though would keep his title - but has not yet made any indication that he will.

By Ben Bloch, political reporter

In the wake of a series of revelations about Peter Mandelson's relationship with Jeffrey Epstein, particularly during the period he was de facto deputy-PM in Gordon Brown's government, Sir Keir Starmer is facing calls to pass legislation to kick him out of the House of Lords.

Lib Dem leader Sir Ed Davey has said it is "the very least they can do for the victims and survivors" of the convicted paedophile, and the SNP say they have a bill "ready to go" for the government to advance.

So why hasn't No 10 done it?

Although the PM's team is clear that they want Mandelson gone, there is no mechanism to remove a peerage once it has been awarded.

The only way to remove someone from the House of Lords is through an Act of Parliament, and although that was done in 1917 for a group of "enemies" of the UK in the First World War, it has never been done for an individual peer.

There are fears in No 10 that if they did table such legislation, it could get bogged down by amendments from peers who do not want to set a precedent that the government of the day could use against any peer they deem has behaved badly.

The Conservative Party - which has the largest number of peers in the upper chamber - is effectively backing that position.

Shadow cabinet minister Alex Burghart said this morning that he believes in "due process", and if Mandelson is found to have broken the law, he would support moving to remove the disgraced peer.

Leader Kemi Badenoch was also clear to broadcasters this morning that if a peer has been "convicted of criminal offences, then yes, I don't think people should be sitting in the Lords".

Watch: Why hasn't Mandelson been stripped of peerage?

No 10 is certainly not ruling out tabling legislation to remove Mandelson directly, but they believe that getting agreement from all parties on reforms to the process for removing a peer is the quickest solution (barring the sacked former ambassador resigning, which is the preferred expedient option).

Sources have told Paste BN that the government is working "at pace" to reach an agreement with the other parties in the Lords, but the longer it takes, the more pressure increases on No 10 to take unilateral action, which they believe has its own risks.

The latest revelations around Peter Mandelson and Jeffrey Epstein are far from the first scandal to engulf him.

In fact, Lord Mandelson has been involved in a series of scandals, dating back to his time as a cabinet minister in the New Labour governments.

Known as the prince of darkness, he was famed for his mastery of the art of spin.

Lord Mandelson, at the time Labour MP for Hartlepool, was first forced to resign his cabinet job of trade and industry secretary in 1998 after failing to disclose a loan for a home from Labour millionaire Geoffrey Robinson to his building society.

He returned to cabinet the following year as Northern Ireland secretary - but was forced to resign again in 2001 over claims he helped businessman Srichand Hinduja with an application for a UK passport.

He was cleared of any wrongdoing two months later - but it was too late to save his cabinet job.

He quit the Commons - and the UK - in 2004 to work for the EU - where he was accused of inappropriate links to various businessmen, including claims he accepted hospitality on a Russian oligarch's £80m yacht.

At the time, Mandelson denied giving or receiving any favours in return.

When his term as EU commissioner ended, he returned to the UK - and was put into the Lords by Gordon Brown, to become business secretary and de-facto deputy prime minister.

It's this period where Lord Mandelson is alleged to have leaked sensitive information to Jeffrey Epstein.

After Labour left government, he left frontline politics - until he started offering Sir Keir Starmer advice in the run up to the 2024 General Election.

After winning the election, Starmer appointed Mandelson as the UK's ambassador to the US in late 2024.

He was sacked as ambassador in September when more details over his relationship to Epstein came to light.

It's this history that Labour's political opponents are using to question Starmer's judgement - and that of his chief of staff, Morgan McSweeny.

On today's episode of Politics at Sam and Anne's, the pair discuss the political reaction to the Epstein files across Westminster - and whether the saga has the potential to break British politics.

Watch an excerpt of today's episode below...

There could be a "crunch point" in parliament tomorrow as the opposition is considering forcing the government to publish documents related to Peter Mandelson's appointment as ambassador in Washington, our deputy political editor Sam Coates has learned.

He explained on Mornings With Ridge And Frost that the Conservative Party could use its opposition day debate tomorrow to table a humble address - a motion that would be binding on the government that is usually used by parliament to compel the government of the day to provide information.

"Parliament has the power to force disclosure of pretty much anything in government, and the Tories smell blood," he explained.

Parliament could force disclosure of:

• The due diligence work conducted before Mandelson's appointment;
• The results of the vetting conducted;
• Any security concerns raised (which would have to be disclosed to a select committee) - and Sam revealed this morning that concerns were raised around Mandelson's financial connections ahead of his appointment (more here).

Normally an opposition motion would not trouble a government - certainly not one with as big a majority as Labour's.

But fury with the PM's chief of staff, Morgan McSweeney, could put No 10 in some peril, as he is viewed as a "factional figure" who was close to Mandelson, and has not been a great chief of staff.

Sam said: "I have been talking to Labour MPs over the last 24 hours, and they tell me they could abstain or maybe even vote with a Tory motion 'if it deals with the problem of Morgan McSweeney'.

"There is a huge amount of anger, and there is a chance right now that within 24 hours, Keir Starmer finds himself in serious difficulty on the floor of the House of Commons."

A former Treasury adviser tells Paste BN that the apparent leaks of government information by Peter Mandelson to Jeffrey Epstein "beggars belief".

Catherine MacLeod, who was a special adviser to the then-chancellor Alistair Darling, says: "The country, the government were facing a very difficult financial crisis. It was working hard, fighting hard to emerge from it with the economy intact. That's what they were trying to do.

"So I can't imagine that there were any conversations or deliberations that would be more sensitive than was happening at the time."

Baroness MacLeod tells Wilfred Frost that Darling, who died in 2023, would be "absolutely shocked to the core... at the scale of this treachery".

Asked whether Lord Mandelson could be prosecuted for sharing market sensitive information, she says:  "Insider trading is an offence and whether or not this qualifies for insider trading, I don't know.

"But if it's an offence, Lord Mandelson will be prosecuted and he is going to have to face the consequences of what he's done."

Paste BN has contacted Lord Mandelson for comment.

 The gaps in vetting Peter Mandelson for UK ambassador to the US shows that the entire vetting system needs updating, the chair of the foreign affairs committee says.

Dame Emily Thornberry tells Wilfred Frost that Lord Mandelson's appointment "exposes the weaknesses in our vetting process and in our due diligence process".

"We had the mandarins in front of my foreign affairs committee, and we asked them what the vetting process was. And to be honest, it's so clunky and old fashioned. I mean, it's like it kind of harks back to the 50s," she says.

Thornberry adds: "The due diligence just seems to be look at open source, put it in a document, hand it over. They didn't even have Mandelson in to ask him any questions!"

She wants candidates to be ambassadors to appear before her committee.

But she defends Sir Keir Starmer, saying he's a "busy man" and has to rely on others to give him advice.

But "checks and balances exist, and we should have paid more attention to them" Thornberry says - adding that a political appointment to an ambassadorial role was a "huge risk".

She says that the revelations reflect poorly on Lord Mandelson's appointment, but says: "I've yet to hear any convincing evidence that he did anything other than a thoroughly good job when he was ambassador, and that's important."

Lord Mandelson's friendship with Jeffrey Epstein was known about before he was appointed as ambassador to the US, although the government says they didn't know about the details that have been published in the Epstein files.

On this morning's episode of the Cheat Sheet with Ridge And Frost podcast, presenter Wilfred Frost explained the laws around insider trading, and how Peter Mandelson could have fallen foul of them in his communication with Jeffrey Epstein.

He said: "You have to have material, non-public information - so information that's relevant to the markets that other people don't have.

"And either you encourage someone to deal on it, which is a bigger crime, or simply you disclose it. You don't have to be the person then profiting from this information if you disclose it and you are aware it is sensitive.

"It's a crime, by the way, that can lead to up to 10 years in jail in the most extreme circumstances."

Explaining how it relates to Lord Mandelson, Frost said people are pointing to "two big examples".

"In 2009, he seemingly shared internal advice to the prime minister, Gordon Brown, about whether the UK should sell off up to £20bn of financial assets to try and ease the debt burden," Frost said.

"Let's remember this was the peak of the financial crisis - there was a lot of pressure on markets all around the world. And similarly, seemingly leaking plans for a £500bn bailout the day before it then happened.

"This is, on the surface, material non-public information."

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Mandelson has previously said: "I was wrong to believe Epstein following his conviction and to continue my association with him afterwards. I apologise unequivocally for doing so to the women and girls who suffered."

In an interview with The Times carried out last week but published on Monday, Mandelson referred to a "handful of misguided historical emails, which I deeply regret sending", and described Epstein as "muck that you can't get off your shoe".