The Mandelson Affair: He felt in his bones the show was over

AS A RESIGNATION, at least it had a touch of class. One of Peter Mandelson's most valuable assets has always been to judge where a story is going, and yesterday he used it once again in the service of the party.

He felt in his bones on Tuesday night that the show was over and he told the Prime Minister so. After a night's sleep, he had not changed his mind and he didn't hang about.

You could tell when Terry Lewis, the unreconstructed Old Labour MP for Bromsgrove, congratulated him warmly for his honourable decisiveness and wished him - without irony - a happy Christmas, that the party has never liked him quite as much as yesterday. This matters because on it may rest his chances of eventually making a comeback.

His decision to borrow from Geoffrey Robinson a sum that would take many of his constituents a lifetime to earn, and then to keep it secret, was a colossal misjudgement, and he was right in the interests of himself and the Government to go. Not only that; but had he tried to stay, it would have been much more difficult for Mr Blair to part with Mr Robinson, as Mr Mandelson and Mr Blair undoubtedly recognised.

What happens to him now? He will rediscover the life on the back benches that he led from 1992-94. He will speak and write on Europe, and do some travelling, "exporting Blairism" as he puts it. He has always had a yen to run a large organisation, perhaps in the private sector. But he has never managed to stay away from politics for long, and he is not that likely to leave now. He is entitled to enjoy himself. But if he is sensible he will resist the temptation to fly so close to the sun with his rich and powerful friends that he loses his appetite for the hard and unglamorous graft of backbench politics.

Having ruefully told the editor of the Hartlepool Mail yesterday that he will have more time to spend in his constituency, he would be well advised to do just that. Mr Blair will regard his departure as a grave loss - for his advice, for his friendship in the notoriously friendless world of high politics, and for what he symbolised. He was an oddly reassuring figure to the middle ground of politics outside the party - not because he was loved, but because his sheer presence made the idea that the Labour left would reassert itself so preposterous. For all these reasons, Mr Blair will want him back perhaps running the next election campaign, and perhaps in the Cabinet after that. Now it's up to him.