Full of internal tensions it may be but the modernising fraction of the Cabinet is not so large that it can lose one of its three founder members, however controversial.
Mr Mandelson is a figure who generates so many myths that it is hard to separate the legend from reality. He was by no means the only architect of the Labour Party's modernisation. But he has, like Mao's comrades in 1948, a pretty special place in the history of the long march back to electability begun by Neil Kinnock when he became Labour leader in 1983.
Indeed if anyone should take the blame, or credit, for the rise of Peter Mandelson it is Neil Kinnock, who backed his appointment by the National Executive Committee as director of communications in 1985.
Mr Mandelson proved an invaluable ally to Mr Kinnock and others in the then Labour leader's heroic struggle to reverse the huge set-backs to the party's popularity inflicted by the surge of Bennism five year earlier.
Strange as it seems now, Tony Blair, and to a lesser extent Gordon Brown, were once, at least in one respect, mr Mandelson's proteges. Mr Blair, especially, was "trained up" by Mr Mandelson in the art of handling the media - a highly important skill for a man who would become the most media conscious of post-war Prime Ministers.
Each of them, as Mr Mandelson started to see as early as the 1987 election, were not only the most talented politicians of their generation but were also developing a far-reaching vision for how Labour could once again become the natural party of government.
In policy terms, Mr Mandelson was nowhere near as inventive as either Mr Brown and Mr Blair. But his consistency as a Labour Party revisionist and his signal expertise in devising a media "line to take" on any particular issue, his ability to compress it into a soundbite which would lodge in the public mind, and his knowledge of which journalists would be most receptive to which message, were all invaluable assets to his more senior colleagues.
From 1988 to 1990 and again from 1992 to 94 the men increasingly worked together until they were acting as an almost inseparable trio.
The traumatic period of uncertainty over whether Mr Brown or Mr Blair would run as leader in the wake of John Smith's death famously sowed the seeds of the enmity between Mr Brown and Mr Mandelson, who became convinced that of his two moderniser friends it was Mr Blair who looked the likely winner.
But while one side of one of the most remarkable triangles in British politics was fractured, the other two sides - between Mr Brown and Mr Blair and between Mr Mandelson and Mr Blair - remained intact.
Mr Blair regarded Mr Mandelson as too controversial a figure within the Labour Party to make him an open member of his leadership campaign team. But as "Bobby" he performed a clandestine and central role in the campaign, giving his usual mixture of media, tactical and strategic advice. And he continued to do so, along with Gordon Brown, up to and including the general election.
While Mr Brown was in overall charge of the campaign and its strategy, Mr Mandelson had spent the best part of two years planning its mechanics while continuing, along with the then Shadow Chancellor, to give a stream of political advice. And with the help of Philip Gould, the man he brought in to provide research, after he was appointed director of communications in 1985, Mr Mandelson also gave polling advice.
It seemed baffling to many in a party which took the best part of a decade to shake off its deep suspicion of, and hostility towards, the press that someone whose initial skills and experience were in media relations should come to assume such importance. But that overlooks two important points. One is the nature of oppositions, for whom the media is virtually the only weapon, apart from parliament, at their disposal. And the second is, as Mr Mandelson had been one of the first prominent Labour figures to realise, the Marshall McLuhan-esque truth that in modern politics it is impossible to separate the medium from the message. Just as the good salesman whose product is thought to be unsafe, or useless, goes back to his bosses and tells them to change the product, so the political media man begins to exercise and influence in policy.
This helps to explain not only Mr Mandelson's role, but the steadily increasing importance of his old friend Alastair Campbell in the Prime Minister's inner counsels. Mr Mandelson provided not only advice, but in the notoriously friendless world of high politics, friendship. Last but not least, he was a lightning conductor. As the leadership's most unpopular figure he was able to do down its enemies and take the heat by being its public defender when it got into trouble. And in all this Mr Mandelson had a revisionist clarity which dated at least from his time as a Lambeth councillor in the early 1980s.
Mr Mandelson has never been short of faults but inconsistency hasn't been one of them. There will no doubt be jubilation in many quarters of the Labour Party this Christmas. But not in Ten Downing Street.Reuse content