Mandelson in charm offensive

A NEW humble Peter Mandelson emerged centre stage yesterday confiding that his short time outside front-line politics had left him at something of a loss.

Conscious of his reputation among detractors as a cold-blooded Machiavelli, Mr Mandelson exuded human frailty to an audience of initially sceptical trade unionists.

Speaking at the policy conference of the Amalgamated Engineering and Electrical Union in Jersey, the former secretary of state for trade and industry said: "You can imagine how I felt these last six months, a bit disorientated, a little awkward, not knowing quite what to do with myself. When John Monks [TUC general secretary, speaking about the relationship between New and Old Labour] made his recent remarks about embarrassing elderly relatives, I wondered if he had me in mind."

To the humility, Mr Mandelson added humour. He did not miss the trappings of power, "but I've only just got out of the habit of jumping into the back of cars and wondering why they don't move off". What he missed most, he said, "was the chance to make a difference".

Despite the denials of his friends, his first major public speech was seen as a comeback for Mr Mandelson who resigned last Christmas after failing to disclose a pounds 373,000 home loan from the then Paymaster General, Geoffrey Robinson.

He has spent the past six months, both publicly and behind the scenes, working on his political rehabilitation. He turned down lucrative offers from City firms and media companies and instead carried out unpaid work for Voluntary Services Overseas in its campaign to recruit more volunteers. The VSO work, together with help for an NSPCC publicity campaign, helped soften his image and enabled him to reveal that he had spent time in his youth as a volunteer in Africa.

To the bemusement of some colleagues and Tories who had felt the effects of his spinning, Mr Mandelson even claimed he had a "passion for compassion".

More importantly, he retained his key role as the Labour party's main liaison with the German Social Democrats in negotiating a new European "Third Way" manifesto. The document, jointly published last month by Tony Blair and the German Chancellor, Gerhard Schroder, committed the left- of-centre parties to a tax-cutting, pro-business agenda and proved that Mr Mandelson retained his close association with the Prime Minister.

His charm offensive seemed to work. Just one delegate clapped his appearance on stage at the Fort Regent conference centre, but by the end there was generous applause.

In a reference to his brittle relationship with trade unionists, he said: "My true friends have always been in this party and they will always be in this party and in this movement. If I did not realise it once, I certainly realise it now."

Mr Mandelson was speaking after an invitation from Sir Ken Jackson, the union's general secretary. His conversational approach went down well with the audience, only some of whom saw his performance as a calculated ploy to win support for his re-emergence from a union which commands substantial influence in the party.

Most union officials believe his reappearance in the Cabinet after the next election is inevitable, although there was speculation yesterday that it might happen sooner.

Sir Ken, who fought hard against Mr Mandelson's attempts to water down proposals and union rights, registered his approval of the former trade secretary's contribution. "It was courageous of Peter to come and speak, but he was genuinely well received. His performance topped the bill and confirmed that he should be in the front line of politics."

The serious issue addressed in the speech was Mr Mandelson's support for the euro. The potential benefits of adopting the new currency were "huge", he said, although he emphasised that the conditions for entry would have to be met.