Peter Mandelson has been made a peer this afternoon, as controversy swirls around him concerning his payoff from the roll of European trade commissioner.

Mr Mandelson will continue to receive £234,000 over the next three years in taxpayers’ money, in addition to a ministerial income of £104,386.

This comes in addition to a generous EU pension scheme which pays him £31,000 a year – rising in line with inflation – from the age of 65.

The extent of Mr Mandelson’s payments caused outrage among opposition parties.

Mark Francois, Conservative Europe spokesman, said: “Not only did Gordon Brown recall Peter Mandelson to shore up his own position, but it adds insult to injury to know taxpayers will have to pay extra for the privilege.”

Mr Mandelson became Lord Mandelson of Foy and Hartlepool today in order for him to assume his role as business secretary.

Hartlepool used to be his Commons constituency while Foy is a village where he holidayed as a child.