Mandelson denies deal with Murdoch.
The former Business Secretary told the Leveson Inquiry that Tony Blair sought to "reassure" The Sun over issues such as Europe. But he insisted there were no pacts made with any media proprietors in order to win their newspapers' support for Labour.
"In my view and from my experience and knowledge of the time, there was no deal, express or implied, between any proprietor and any leading politician for the Labour Party that suggested that in return for that proprietor's support for the Labour Party they could expect some favourable commercial treatment in return," he said. "I don't believe any such deal happened and I don't believe such a relationship existed." Lord Mandelson acknowledged that both Mr Blair and his successor Gordon Brown "arguably" became "closer than was wise" to Mr Murdoch.
But he said there was no "Faustian pact".
"As far as the Labour Party is concerned, I do not believe, generally speaking, that the public interest was subordinated to the party's interests in seeking good relations with News International," he said in his written evidence to the inquiry. "I reject the view that, under either Mr Blair or Mr Brown, some sort of Faustian pact was forged between the government and Rupert Murdoch involving commercial concessions to him in return for support from his newspapers."
He said "the contrary" was the case.
But he went on: "It is also arguably the case, however, that personal relationships between Mr Blair, Mr Brown and Rupert Murdoch became closer than was wise in view of the adverse inference drawn from the number of meetings and contacts they had."
Lord Mandelson said the Labour Party and News International "had a famously bad relationship" in the 1980s.
"Dialogues were opened" with journalists, editors and executives, "including the proprietor", Lord Mandelson said.
He added: "I don't think that's unreasonable.
[bar] Lord Mandelson arrives at the Leveson inquiry yesterday