Ian McCartney, Minister of State at the Department of Trade and Industry, who is in charge of Labour's radical plans for a national minimum wage, offered his resignation to Margaret Beckett, President of the Board of Trade, two weeks ago, according to fellow MPs and sources within the DTI.
Friends of Mr McCartney, a tough Scot dedicated to pushing through the policy - a legacy of the late John Smith - say he was infuriated by attempts from above and from Mr Mandelson to water down the measure. His exasperation boiled over on 24 November, virtually the eve of publication of the Government's Bill to enact the national pay plan. Westminster sources say he submitted a letter of resignation to Mrs Beckett, but sympathetic ministers - including Chancellor Gordon Brown and the Culture Secretary Chris Smith - rallied round Mr McCartney and he kept his job.
Last night, Mr McCartney formally denied offering his resignation, as a minister would in such circumstances. He said: "It is a complete fallacy. I have never resigned from anything in my life, although on occasion I have been sacked from a few jobs!"
The son of a former Labour MP in Glasgow, he was a TGWU shop steward and full-time party worker before entering the House in 1987 as MP for the safe seat of Makerfield, Lancs. Aged 46, he is one of a small number of MPs from the traditional wing of the party who have been given substantial jobs in the Blair administration.
The row brings into the open simmering discontent over the role of Mr Mandelson, who irritated many MPs during the Labour Party conference with his suggestion that the minimum wage would not apply to young people, and that there might be other exemptions. Mr McCartney has fought a fierce battle to minimise exemptions, and angrily ruled out regional variations in the Commons on 20 November - four days before his threatened resignation.
Controversy has dogged the national minimum wage since it became Labour policy. Tony Blair is known to have private reservations about the measure, and traditionalist MPs fear Mr Mandelson is merely "his master's voice" in calling for wide-ranging exemptions. The Prime Minister would happily have accepted Mr McCartney's resignation, it was suggested at Westminster.
The McCartney affair is the second instance in recent weeks of conflict between Peter Mandelson and fellow ministers. He suffered a rare and stinging defeat after ministers rebuffed a last- minute attempt by him to dilute the powers of the Food Standards Agency, which is designed to end the food scandals of the past decade. Agriculture Minister Jack Cunningham and Health Secretary Frank Dobson fiercely resisted pressure to limit the agency's role in developing policy and legislation on the nutritional quality of Britain's food.
Meanwhile Downing Street is preparing for the biggest revolt by Labour backbenchers since the party regained power seven months ago. Many MPs are unhappy over the proposal by Harriet Harman, the Social Security Secretary, to cut benefits for lone parents by up to pounds 10 a week from April.
Four parliamentary private secretaries, unpaid aides to ministers, are thought to be considering resignation rather than supporting the measure. Other MPs are certain to defy the Labour whips and support an amendment tabled by Labour MPs Audrey Wise and Lynne Jones deleting the benefit cuts from the Social Security Bill on Wednesday.
Mrs Wise said: "I don't expect to feel lonely in the lobby. I have no doubt that if this was a free vote, then this proposal would be lost. That speaks volumes. I believe MPs should feel a responsibility for the way they vote."Reuse content