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Sir Keir Starmer appointed Lord Mandelson as Britain's ambassador to the United States despite the peer having failed government security vetting, it has emerged - as the Prime Minister was accused of misleading parliament over the affair.

The Express understands vetting officers had recommended Mandelson should not be given the role, but Foreign Office officials overruled the advice and rubberstamped the appointment. Starmer had insisted for months that "due process had been followed" and that Mandelson had been cleared by the security services.

On Thursday evening, Starmer sacked the Foreign Office's most senior civil servant over the scandal. Sir Oliver Robbins lost the confidence of both the Prime Minister and Foreign Secretary Yvette Cooper, it is understood.

No 10 said the Foreign Office had failed to inform Starmer or anyone in Downing Street that Mandelson had failed his vetting before the decision was overturned.

The revelations triggered immediate alarm within government, reports The Times. A senior government source is understood to have described No 10's defence as sounding "fantastical". Another source, who had been involved in early efforts to oust Starmer during the previous Mandelson crisis, reportedly said: "It's back on."

Conservative leader Kemi Badenoch called for Starmer to quit, saying: "It is either, he knew that Mandelson failed the security vetting and lied to us in Parliament, on TV repeatedly, or he didn't know, didn't ask and said he had passed the security vetting - which means he is hopelessly incompetent."

Liberal Democrat leader Sir Ed Davey said that if the Prime Minister genuinely did not know Mandelson had failed vetting, he should have "told Parliament at the earliest opportunity, not waited for the media to force the truth out."

"His failure to do that alone is surely a breach of the ministerial code," he added.

Reform UK, the Green Party and Plaid Cymru all called for Starmer to go, accusing him of lying about Mandelson's vetting. The SNP wrote to independent ministerial standards adviser Sir Laurie Magnus demanding an investigation into whether the Prime Minister had deliberately misled the public.

SNP Westminster leader Stephen Flynn said: "The prime minister is either incompetent, gullible or a liar. Or all three."

With resignation calls mounting, Downing Street released a late-night statement insisting Starmer and former foreign secretary David Lammy had no knowledge that security officials had advised against granting Mandelson clearance, placing responsibility squarely on the Foreign Office.

"The security vetting process for Peter Mandelson was sponsored by the FCDO.

"The decision to grant Developed Vetting to Peter Mandelson against the recommendation of UK Security Vetting was taken by officials in the FCDO," a spokesperson said.