Pat McFadden suggested the shamed peer donate the money to a charity helping female victims of violence.

A cabinet minister has called on Peter Mandelson to give up the five-figure taxpayer-funded pay-off he received after being sacked as the UK’s ambassador to Washington.

Work and pensions secretary Pat McFadden suggested the disgraced peer donate the money to a charity for female victims of violence.

The Sunday Times reported that Mandelson received between £38,750 and £55,000 – equivalent to three months’ salary – after Keir Starmer sacked him last September over his association with the convicted paedophile Jeffrey Epstein.

The former Labour peer now faces a criminal investigation into allegations he passed market-sensitive information to Epstein when he was business secretary between 2008 and 2010.

On Sky News this morning, McFadden was asked whether Mandelson should give up the pay-off.

He said: “I think he probably should, yes – either give it back or give it to a charity, perhaps one involving violence against women and girls.

“I think taking a pay-off in these circumstances, I don’t think the public will think much of that.”

A No 10 source told the Press Association: “Given what we know now, Mandelson should either pay the money back or give it to a charity to support victims.”

Shadow foreign secretary Priti Patel said: “A five-figure taxpayer funded payout for Lord Mandelson is a disgusting betrayal Epstein’s victims.