British prime minister Gordon Brown overhauled his cabinet today, recalling old hand and former enemy Peter Mandelson in an effort to shore up his premiership at a time of economic crisis.
The surprise return of Mr Mandelson, the European Union trade commissioner, will strengthen Brown's position within his Labour Party at a time of doubts over his leadership and sniping from other former allies of Tony Blair, analysts said.
Mr Mandelson will take on the office of business secretary and is expected to play a central role in a newly created economic council that will oversee the fallout from the economic crisis.
Twice a cabinet minister under Mr Blair, Peter Mandelson also quit twice under a cloud and some Labour members said he was such a divisive figure that Brown's bold and surprising move may not go down so well with the British public.
Mr Brown and Mr Mandelson have had many spats in a relationship going back 20 years. Initially close, the relationship soured after Mr Mandelson backed Mr Blair for the Labour leadership in 1994.
Speaking to reporters in Downing Street, Mr Mandelson said the prime minister was doing an "exceptionally good job" and he was proud to have been asked to work in his government.
"The prime minister has asked me to come back. Our economy, like every other, is facing a very hard challenge as a result of the global financial crisis and in a sense it's all hands on deck," Mr Mandelson said.
Public support for Mr Brown, who served as finance minister for a decade under Blair, slumped earlier this year to leave Labour 20 points behind the Conservative party and on course for a wipeout at the next general election, due by May 2010.
But Mr Brown (57), has seen support improve in recent weeks as voters worry about the untested Conservatives' ability to handle a crisis. While still trailing, Mr Brown has cut the deficit in the polls to around 10 points.
A key architect of Mr Blair's New Labour project that moved the party to the centre of British politics, pro-business Mr Mandelson said in an interview this week the party must stay true to that ideal and avoid a drift back to the Left.
With economists saying Britain entered recession in the third quarter for the first time since the early 1990s, Mr Brown needs to reassure the public he is the man to steer the country through the economic turmoil before the election.
The creation of a special cabinet committee on the economy, similar to one already created to handle terrorism and security threats, was an expected move and one designed to tackle more aggressively the greatest economic crisis in decades.
The outlook for Britain's economy darkened further today as a survey showed its services sector contracted at the fastest rate for at least 12 years and bellwether retailer John Lewis reported a plunge in sales.
Reuters