Don't drift into a PhD as an exit from teaching - unless you are doing it for the right reasons you will probably hate it. The lack of money and structure will be hard to adjust to, You want full funding and a topic that really excites you. You also need to be aware that an education-based PhD is no longer a path to an academic job as it was in the past. AS the government cuts teacher-training places in universities may education depts are downsizing.

Gwen's advice is very sound on letting the dust settle and spending time with people who matter to you. You are much more as a person than a PhD candidate, and while this is really upsetting, you need to be reminded of that right now by people who love you.
Some practical thoughts: Do not delete those emails from the office. I'm amazed they released a result and erroneously as well without the documentation having been submitted and signed off by the relevant dean - that's appallingly bad practice. Whatever else you do, I would make a formal complaint about that at some point, even if it's a lesser concern than the actual result right now.
Keep copies of everything relating to the examination on a non-university account. Get a copy of every regulation and good practice guide relating to the examination of a PhD at your university that you can find. Your supervisors are quite probably already trying to find out the facts in the case, before they speak to you, as without the reports there's not much anyone can do. But once you have the reports as Gwen advises then I'd look to see whether there are any grounds for appeal. It is usually not acceptable for the examiners to bring up wholly new concerns after an R&R for instance. You need to think like a lawyer and analyse this as unemotionally as you can. Hopefully your supervisors will be doing this too. Any causes for concern need to be brought to the attention of the head of your department and the relevant dean in your faculty in a very formal manner, so that they know you are serious.
Are you working at a different place with the contract dependent on this result? If so, do not notify them yet. If you intend to appeal, the process is not complete and you are not obliged to say anything until it is.

An IEEE conference by any chance? This post at RetractionWatch might explain what's happened:
http://retractionwatch.com/2015/06/25/one-publisher-appears-to-have-retracted-thousands-of-meeting-abstracts-yes-thousands/#more-29631
Obviously it means you lose a paper, but if it was a conference paper from a weakly regarded conference, then perhaps not that big a loss in career terms. If you are based somewhere where you haven't got a mentor to ask advice on things like this, then the links to these lists of problematic publishers, journals etc are a useful resource: http://scholarlyoa.com/2016/01/05/bealls-list-of-predatory-publishers-2016/
If you have a look through the comments on the retractionwatch site, you'll see there's a different attitude to people who've been scammed, than there is towards those who've had retractions for plagiarism or falsifying data, so try not to worry too much.

Glowworm - if you get offered any sort of more secure contract, take it. If you give a month's notice or even less, people will cope. If the uni is employing you on an insecure, poorly paid hourly contract basis then you really don't owe them any loyalty. Even if there is a longer notice period, which I expect there isn't, I'd never turn down a better job - let's face it, they can't really force you to work it. The only consideration I'd give is about whether you are burning any bridges that might hurt you down the line, so it is more tricky if you are doing a PhD at the institution in question, but generally look after your own interests first. No-one else will.
My hourly paid TA left us mid-term last year as she got a permanent non-academic full-time job and gave a week's notice. We'd found a replacement within 48 hours from ringing round the speculative cvs people had sent us. Yes it wasn't ideal but we managed. So long as you don't wander off without returning coursework most things are manageable. If universities don't want to be inconvenienced then they should treat their staff better!

Glowworm - if you get offered any sort of more secure contract, take it. If you give a month's notice or even less, people will cope. If the uni is employing you on an insecure, poorly paid hourly contract basis then you really don't owe them any loyalty. Even if there is a longer notice period, which I expect there isn't, I'd never turn down a better job - let's face it, they can't really force you to work it. The only consideration I'd give is about whether you are burning any bridges that might hurt you down the line, so it is more tricky if you are doing a PhD at the institution in question, but generally look after your own interests first. No-one else will.
My hourly paid TA left us mid-term last year as she got a permanent non-academic full-time job and gave a week's notice. We'd found a replacement within 48 hours from ringing round the speculative cvs people had sent us. Yes it wasn't ideal but we managed. So long as you don't wander off without returning coursework most things are manageable. If universities don't want to be inconvenienced then they should treat their staff better!

Hi Katie,
They are quite rare these days in a university setting as there's a tendency to write grants to include funding for a PhD student rather than an entry level RA. Public health departments can be an exception and do sometimes need social scientists. Otherwise government social research jobs or places like the National Institute for Economic and Social Research take Masters graduates particularly if you have quantitative methods skills. Depending on what your dissertation was on, think tanks are also worth a look.

This is just a suggestion and maybe something you are already doing but might a skills-based cv rather than a traditional one be worth a try? It might also blur the date issue a bit, but I was mainly thinking that possibly the titles of your PhD/publications/internships don't adequately convey the skills you have? I'm also a social scientist and a couple of my former colleagues who had real trouble with the job market, had done theory-based PhDs with titles that really didn't convey anything to someone not working in that theoretical tradition, and this is finally what seemed to help for them. Sorry if it is something you're already doing.
Also it's tricky to manage if you are on benefits, but have you any expertise in a particular country / policy sector etc that might lend itself to short term consultancy? Some sorts of short report / evaluation type of work is often farmed out to available experts - might it be worth sending speculative applications to NGOs and the like asking them to keep your cv on file in case any short term opportunities turn up? It's not ideal but it can help get a foot in the door and some relevant experience.

Along with the teaching is of course things like spending weekends doing your fair share of the open days. Putting masses of stuff on blackboard / moodle etc. Marking - providing increasingly large amounts of feedback in the vain hope a student might appreciate it and raise your dept's NSS score. You will be required to gain a teaching qualification usually in the first two years. Your teaching will be judged on your evaluation scores and you will be expected to achieve a certain level. Lots of university teaching is delivered by hourly paid or fixed term usually 9 month contract staff by the way (many of whom have a PhD and are working for about minimum wage when you add up what hours they work compared to those they are paid for - again with the highly qualified workforce around you'd have to make a very good case why you are special).
Then the other third is admin. Degree programme management, quality assurance (lots and lots of this and the TEF promises more), admissions, employability work, managing study abroad/ internships etc. Four times a year you get to account for every hour you've worked that week - depressing how much of it is admin.
All of this is done in a working environment that is poor - university management is often poor and target culture is just as prevalent as it would be in a sales job. Google Stefan Grimm to find out what than can mean in practice. The wages are also not that great unless you get to professor. This blog might also be of interest https://academicirregularities.wordpress.com/ . Basically it's not what most students think it is like.

You also need to factor in the competition, which in your area is strong. To get an interview for a permanent post in Politics / Public Policy, increasingly you need top quartile journal articles, preferably a postdoc to show you can get research funding, teaching experience and the PhD. You'd need some really amazing professional experience for it to count as equivalent.

The person you cited has years of high quality public policy experience not just an MSc. That is what makes them hire-able. What do you have to offer beyond a MSc that makes you so outstanding that a department would risk hiring you without the expected level of qualification - that's what you'd have to ask yourself.
OK you're missing quite a lot about what the job entails, which is why I think you are also romanticising it a bit.
It's a 60 hour working week on average. I don't know any academic who actually manages to take all of their annual leave.
You would be expected from day of appointment to produce 3* and 4* outputs for the REF - you would be trying to do this without any of the methods training a social scientist gets in their PhD, meaning this would be a real struggle given how central methods are now to your field.
You would have annual targets for income generation that need to be met - there is a 12% success rate for the main funder in your area so a large chunk of time is spent writing grants which are not funded.
You will be expected to produce research with real-world impact, which means devoting time to engagement activities (there goes another chunk of your free time).
Then you have reviewing, PhD supervision (without a PhD you'd probably not be allowed to do that so would get more teaching/admin instead), presenting at conferences etc to round off the research side of the role.
A third of your time is teaching - I am giving 40 hours of lectures plus seminars this year. That's quite a lot of prep. You won't only be teaching in your specialist area of course - particularly as without a PhD you'd struggle to claim a specialist area.Personal tutoring - that takes up a lot of time as counselling services are so over-stretched that a lot falls back to academic staff. Continued....

Two suggestions:
1) time travel - go back to the 1970s when a PhD wasn't needed.
2) Have a glittering public policy career and then try.
If you are a strong candidate, then there is funding for PhDs in public policy / politics, but you need to be really good. Candidates for even research assistant roles in those areas these days will tend to have a PhD, publications and teaching experience simply because there's a serious large pool of un / under-employed people with PhDs in the field. With an MSc not much chance in academia, you'd be better trying the government route, if you don't want to do a PhD.I also wonder whether you have a realistic idea of what an academic job entails?

It's exactly the same in the social sciences in this case. Just that the rejection on a single-authored article stings even more as you haven't got others to commiserate with!
Awsoci, give it a fortnight, then go back to the new reviews. A bit of distance will help you make a better decision on whether what they suggest will make it a better article. If they will, make the changes and submit elsewhere, if not submit as it is (obviously respecting the new journal's requirements). The major social science journals have really low acceptance rates, and it might be that you were just aiming a bit too high with the two papers. I'd definitely persevere with the two papers, and send them to at least one other journal before giving up on them (I think you'd be surprised how many rejections big names get), as I presume this is part of your PhD data and you do need peer-reviewed publications out of it.

Getting yourself into serious debt to do a PhD, when as this forum shows regularly, people are not getting the types of jobs they hoped for at the end, is not a very good idea. The last stats I saw suggest that only 8% of UK PhDs get permanent academic jobs, so the odds are not good, and if you aren't in a discipline where a PhD is useful for non-academic jobs, those odds need to be weighed against the financial sacrifices you make as HazyJane says.
It's also difficult if you want to try for academic jobs, as if at the end if you are already at the limits of whatever you can borrow, you are not going to be able to sustain the very uncertain years after the PhD where you are likely to have to move frequently (certainly nationally and maybe internationally), chase after very short-term contracts and/or live on hourly paid teaching which realistically works out about minimum wage. If you are self-financing and trying to juggle another job and study, it's also very hard to find the extra time to publish / present / teach i.e. to get the things onto your cv that give you a chance of getting an academic job or applying for postdoc scholarships. Obviously if you are independently wealthy or have well-off partners / parents then doing an unfunded PhD is unlikely to have a majorly negative effect of your financial position, but for the less fortunate, it really is something that has to be considered high risk.

Did you ask him whether he'd be willing to do it before sending it and agree a timescale?

Will you have the right to work in the UK? That is crucial as they won't be able to employ you in any capacity if you do not, and I doubt a small college like that will have the ability to sponsor someone for temporary work given the hoops UKBA makes employers jump through.

OP regarding the fees and the professional doctorate - could you talk to someone about a suspension of studies rather than a withdrawal, then you could go back later perhaps?
Good luck with the interviews, but I think you need to think about the best way forward with the bad reference in case they don't work out. I think it depends what the issue was and how professionally damning it is. So for example, if the reference reports you were falsifying results / plagiarism / sexual or racial harassment then you can probably forget a research / lecturing role. If at the other extreme, the reference is accurately reporting the numbers of days you had off sick (and referees in the UK are required to be truthful when that question is asked) and that is off-putting, then perhaps the easiest way round that, now you are better, is to take any job and then have a new reference that can speak to the fact that it was a temporary problem now passed. If you can see a not so great job as a temporary means to an end, then perhaps it wouldn't be so demoralising.