Unions: “Stop David, not Get Ed”

Despite gleeful howls from the right-wing press, it seems that the unions were more interested in st

The debate about the extent to which Ed Miliband owes his election victory to the unions is going to rumble on and on. Already, it's the most prominent detail of his election: for instance, the Telegraph's front-page story today ("New Labour is dead") features the phrase "Mr Miliband insisted he was his 'own man' and not in thrall to the unions, whose support gave him victory."

This morning, Alistair Darling was on the Today programme to talk about Labour's future economic policy, but instead found himself tackled by Sarah Montague on Ed Miliband's likely economic direction, given the manner of his election. Even Patrick Wintour's detailed and excellent analysis of the voting breakdown in today's Guardian concedes in its headline that "the unions had the last word".

The right-wing press is clearly going to enjoy attempting to undermine Ed Miliband as he attempts to take the Labour Party forward with references to his "thrall" to union barons and his lack of a democratic mandate. There can be no doubt that the numbers appear to stack up behind this argument: Ed received first preferences from just 72 of the 635 constituency parties, but dominated union members, with 47,439 first preferences compared to his brother's 21,778. Union turnout overall was low -- just 9 per cent of those eligible voted -- but it seems that those who did turn out did so overwhelmingly for the younger Miliband.

The relationship between Labour and the unions must and should be subject to close scrutiny. But, before anyone writes Ed off as a union stooge, Kevin Maguire, in his Mirror column today, teases out a vital point: the unions didn't so much elect Ed Miliband as not elect David Miliband. Or, as Maguire put it, they "whirred into action to Stop David not Get Ed".

Nigel Morris in today's Independent makes a similar point, even quoting a union official saying: "We stopped David -- that's the main thing." According to another of Morris's union sources, they viewed their tactics as "levelling the playing field" for the other candidates in the face of David's superior resources.

And here we run up against yet another ramification of the Miliband brothers' family relationship -- in another contest, perhaps the way for Ed Miliband to distance himself from his apparent popularity with the unions would have been to emphasise that he had merely benefited from his rival's inability to appear "in touch" with the working class as represented by union members.

But although Ed has shown himself to be ruthless, he has also proved himself the kind of politician who will not kick a fellow candidate when he's down. That the candidate in question happens to be his elder brother would thus seem to rule this course of action out for him.

The problem now facing Ed Miliband is clear: if he takes union funding to replenish his party's empty coffers, making various concessions on his approach to cutting the deficit in return, the party will be financially ready to campaign much sooner. But, as the reactions from the right-wing press have already demonstrated, the taint of union involvement, especially when it comes to economic policy, hands crucial ammunition to the Conservatives at a time when Labour desperately needs to be on the offensive.

As delighted as Ed will be to have woken up leader of the Labour Party this morning, I can't help but think he will already be regretting, in private, how he got there.

Caroline Crampton is web editor of the New Statesman.

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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.