Tony Blair was once asked why he persisted in keeping such a divisive figure as Peter Mandelson at his elbow. Blair explained that in a major crisis (there certainly is one now) most colleagues would say: "What shall we do?" "Peter would say: 'We must do this, this and this.' "

Back in the early 1990s, when Blair, Mandelson and Gordon Brown were battling to create what became New Labour's winning formula, Brown knew that too. Alastair Campbell's diaries describe a triangular relationship of almost sexual intensity between the three arch-modernisers.

But Mandelson's decision to back Blair to succeed John Smith when the then Labour leader died in 1994 created a powerful enmity. Mandelson had always been a convenient hate figure for many Labour MPs and activists. Brown was now on his case, too.

The Brownites meant to do him harm, though Mandelson helped. His own behaviour brought him down, over his secret £373,000 loan (1998), if not the Hinduja passport resignation (2001). That sacking was unfair: Blair panicked.

Why has Brown changed his mind? Labour MPs were divided yesterday, a typical Mandelson effect. Some were appalled at a "desperate" move. Others proclaimed a masterstroke, proof that Brown retains the will to survive, to be unexpectedly bold and fight back against the Cameron tide.

The Tories will make "back to the future" jokes, but the Prince of Darkness has always frightened them. The bookies' election odds will change.

With hindsight, there have been signs of a rapprochement. In 2007 Brown came in declaring he would correct his own defects as well as Blair's, his "government of all the talents" phase which fizzled out with the aborted election. As the Tories roared ahead Blair, Campbell and Mandelson were being consulted again. This summer Mandelson decided that Labour should stick with Brown - and that he should rally to his stricken party.

Attempts to kickstart the No 10 machine had failed. In the government's twin crises - global economics and domestic politics - heavyweight experience suddenly looked attractive.

But his re-emergence is bound to be divisive. It already is. The leftwing MP, John McDonnell, protested yesterday that Mandelson was a bad administrator as well as bad politician, a symbol of "failed" Blairism.

Understandable, but wrong: he was rated as trade secretary (1999-2001) and - though controversial as ever - as an anti-protectionist in Brussels. His global contacts and business cred may help boost confidence. Does the arch-Blairite's return prove that Brown's running feud with Blair - Mandelson shot in the crossfire - was entirely about personal ambition, not political differences? Up to a point. They were modernisers, impatient with failed nostrums of the left. But Brown was always more statist, less impressed by market solutions although it suited him to tax City excesses rather than curb them.

Even before his Manchester conference speech, which trimmed David Cameron's 20% poll lead, Brown has seemed cheerier to many who see him up close. The financial crisis has snapped him out of his gloom, given him renewed purpose and a glimpse of a pathway out of defeat. The prodigal Mandelson will now be part of it.

It may all end in recrimination again. But like Cameron, Brown is a "man with a plan" too. "Third time lucky," said Mandelson as he returned to No 10.



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