The Staggers

The New Statesman’s rolling politics blog

Labour's dependence on the unions continues

The trade unions accounted for 86 per cent of all donations to the party in the second quarter of this year.

By George Eaton Published 24 August 2011 14:50

The latest party funding figures have just been released and the most notable thing, as usual, is Labour's remarkable dependence on the trade unions. In quarter two, the party received £3,093,094 in donations, £2,651,589 or 85.7 per cent of which came from the unions. Unite, the country's biggest union, was alone responsible for 24.8 per cent (£765,628) of all donations. Of the £5.9m the Labour Party has received across both quarters this year, £5.2m or 88 per cent came from the unions.

I'm a strong supporter of the trade union link, but it's unhealthy for a progressive party to be so dependent on a few sources of income. As Peter Mandelson argued recently, Labour must "revolutionise its funding sources". Back in 1994, when Tony Blair became Labour leader, trade unions accounted for just a third of the party's annual income. In 2010, they accounted for more than 60 per cent.

There is, of course, no comparison between the unions and the big-money donors the Tories rely on. Donations from Unite, for instance, are taken from the union's political fund, to which 1,291,408 members contribute voluntarily. But this is no excuse for complacency. As I previously noted, the Tories and the Lib Dems are advancing plans to impose a cap of £50,000 on political donations. While the limit would have deprived Labour of 85 per cent of its income since 2005, the Tories would have forfeited just 50 per cent of their income. With this in mind, Ed Miliband must widen the party's funding base as a matter of urgency.

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Tags: Trade Unions

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27 comments

Thu, 2011-08-25 00:18 — Suzanne (not verified)

Can see why the coalition would do this. Pretty much in keeping with the rest of their policies. Unfair and aimed at helping themselves or friends. Unions are democratic organisations who are there to serve the interests of millions of people. This is just another disgraceful piece of legislation from a despicable government

Thu, 2011-08-25 08:01 — Luddite (not verified)

The 'public sector' trade unions accounted for 86 per cent of all donations to the party in the second quarter of this year.

Thu, 2011-08-25 08:59 — mcquade

"The 'public sector' trade unions accounted for 86 per cent of all donations to the party in the second quarter of this year."

Not at all Luddite. Like James, you should read the article before commenting, but in your backward case that is like expecting snow to be hot.

Sat, 2011-08-27 13:24 — Callum W (not verified)

@swatantra nandanwar again, as for a CEO on a wage they would be a part of a proffessional managerial class that has arisen with late capitalism. They run the productive forces of society on behalf of the bourgoesie.

Thu, 2011-08-25 10:36 — Gracie

Where do the unions get their money from?

Members, so it is they who are donating to the Labour party - why haven't you mentioned this in your article?

Also Ed Miliband is widening the party's funding base - "urgently" or is this the real point of your article?

Why not mention that the City (ie bankers, hedge funders, City analysts etc) have donated over £42 MILLION to the Conservative party over the past few years and that figure is climbing all the time.

If the Tories want to have a debate on funding why don't we go the whole hog and talk about how lobbyists donate to the Tories and how closely linked some think tanks are by finances to the Tories. What about the Midlands Industrial Council?

If cameron wants to bring this out then many of us are ready and waiting for him to do it, it is about time the public were made fully aware of just who donates the Tory party and how they hope through their donations to influence party policy, which in turn gets s enshrined in law for all of us to follow. It stinks. How about doing a full expose' on Tory funding? It is past time it was done!

Tory Donorgate - A Comprehensive List

http://cameron-cloggysmoralcompass.blogspot.com/2011/01/tory-donorgate-c...

Tory "Donorgate" - John Nash - NHS - Care UK - Sovereign Capital - Hedge Fund
http://cameron-cloggysmoralcompass.blogspot.com/2011/02/tory-donorgate-j...

Another List of Tory Donors (Ones That Exploit Loopholes)

http://cameron-cloggysmoralcompass.blogspot.com/2011/02/another-list-of-...

Thu, 2011-08-25 11:16 — Gracie

We could ask the Tories, the party who promised to be "open and transparent" who is donating who is donating £265.000 through Focus on Scotland - an "unincorporated association" which is not obliged to reveal the the names of donors using the vehicle to give money?

http://www.bbc.co.uk/news/uk-politics-14650419

Fri, 2011-08-26 08:05 — Luddite (not verified)

mcquade. Some article are worth reading others not. Labour lost it's way, when it stopped representing the whole working class. I truly believe, Labour can no longer win back that lost support. Let's never forget why Labour lost, it's because millions of English white working class men stayed at home or went to the pub on election night.

Thu, 2011-08-25 11:52 — Callum W (not verified)

@swatantra nandanwar, the working class are the majority, not a dwindling minority. Simply because someone attains a higher wage doesnt make them a seperate class to other wage labourers. Most people who consider themselves middle class are working class in the objective sense, ie: they must sell their labour to an employer to survive.

Thu, 2011-08-25 12:22 — swatantra nandanwar

Even CEO's receive a wage or salary but that doesn't make them working class, particularly if they have a fondness for champagne and live in the suburbs or penthouses along the Thames, and even though their father was a barrowboy down Portabello Market.
If you percieve yourself as 'middle class', then you are middle class.
Facts indeed show that the 'working class' is dwindling. There was even a blog in the NS a week ago saying so.
So Labour's traditional base is dwindling. You can't run a successful popular Party on those numbers.

Thu, 2011-08-25 13:16 — Marcus (not verified)

How about a political system based not around party politics, but around merit and success. Popular and inspirational local people that have all been successful at something outside of politics.

Once elected the 400 or so representatives could then elect a PM, a Chancellor and Ministers from those available, again based on merit, ideas and skillset.

These local representatives can serve a maximum of 2-3 fixed terms of government. We would pay them a fortune to attract the brightest, the most experienced, talented, the best. No second jobs would be allowed and an Honour at the end of their service to the country would be earned, not given for selfish acts.

This must be a better meritocratic system for us, the people!

It'll never happen though because the self-acclaimed elite, the politicians within the Tories, the Labour Party and the Lib Dems like it just how they've got it. The status quo.

They control you.

You, on average pay them 67p out of every £1 you earn in one way or another. You therefore work for them and they give you 33p in the £1 for the honour of working 70-75% of your entire lifetime for them.

They themselves, they love the control you give them. They love the fact you do nothing when they and their ilk consistently fail you and remove your liberties. They love the perks you allow them. They enjoy the gifts you buy them. They duck and dive, lie and cheat in the name of tribal politics arguing about minute detail of agreed policy whilst ignoring the wider issues. They do this in your name. They fail in your name. But you ignore it because you are a Starling and they distract you with Katy Perry's new haircut and shiny new earrings. Don't look here at this financial disaster that has been building in the west for 40 years, your life that will be effected by it, the wars we start, things that matter. No, look here at this sparkly new toy. Great isn't it.

Meanwhile those strong enough, those smart enough, those connected enough, those wealthy enough often through family legacy abandon you and pay little or no tax. They see the situation. They understand the way it works. They are no fools.

Tories? Labour? Lib Dems? Clegg, Miliband? Cameron? Brown? Blair? Is this really the best we can do?

They are career politicians, often with sociopath tendencies who deem themselves born to lead because of family ties, because of historic legacy that has nothing to do with them, yet despite being afforded the best education available to mankind would be lucky to make a mid-management role in any serious corporation.

We need things to change. We need better. Whats more we need to expect better.

Always remember that the politicians work for you. We as a society seem to have lost this ethos some time ago. Always good to remind ourselves as they will not remind you.

Britain was the biggest economy in the world a little over 100 years ago. Europe was also leading. Now we have been distracted and squandered our position. We are now the 6th. By the end of this year we may be the 7th.

In your lifetime this country will be a second world nation.

To fight this they increase the population. They cant ask you about it because they know you the people dont want it. They know best though because you are the great unwashed.

The politicians you are paying are squandering, failing and lying yet you cannot do anything about it because you are powerless to change things.

Our economic and political model is disastrously broken. It needs fixing.

I fear for the future of this country.

OK, rant over :)

Thu, 2011-08-25 13:20 — Bratiaith (not verified)

People who consider themselves "Middle Class" are largely just putting on airs and graces.
If you work for a living from neccesity you're working class. If you own enough Capital to be able to feed and house your family reasonably well for the rest of your life without working you're Middle or upper Class.
Don't confuse social standing with Class.

Thu, 2011-08-25 13:29 — swatantra nandanwar

Well, that takes care of the 'working class Tories'. How about the rest?

Fri, 2011-08-26 14:15 — Callum W (not verified)

@swatantra nandanwar, my point is that much of what bourgeois politicians call the "middle class" is actually the labour aristocracy. Still working class as it does not survive off rent or profits, but is able to secure a better standard of living. The term "middle class" is subjective and misleading and is symptomatic of how people have become to think of themselves as consumers rather than producers. All the term does is marginalise the poorest in society.

Thu, 2011-08-25 15:14 — Union Steve

It's time we got value for uor money.

Tue, 2011-08-30 21:20 — stevem1

One wonders why the Unions continue to pour money into a Party that does nothing but kick them in the teeth. Those who pay the piper normally expect to call the tune. In my long experience as a sometime member of the Party and active union lay official this has never happened. When filthy rich donors gave ,however, they got whatever they asked for. (Bernie Ecclestone comes to mind.)Perhaps it is time for the unions to withold money or better still form a new left wing party. Donations to the Green Party would be a better use of the money,too. There is ,in my opinion no future for the Labour Party as it is presently constituted. It is still in thrall to the NUlabour highjackers and their supporters who write here, like Dan Hodges .

Wed, 2011-08-24 14:59 — swatantra nandanwar

Excellent and timely article.
The dependece is unhealthy for both Labour and the Unions and, Labour must broaden its base to include the middle classes and small business people.
In fact Labour must be seen as the champions of small businesses., whereas everyone knows that the Tories are for big business.

Wed, 2011-08-24 15:01 — Marcus (not verified)

This is very damaging and a terrible indictment on not just Labour policy and its leadership, but also for the political classes.

The fact is that we are 'run' by a group of Lib Dems, Tories and Labourites that have little if any relationship with the majority of people in the country.

Their is a massive disconnect between metropolitan liberal big state thinking from all three parties and the thinking of everybody else.

The population grows tired of these same people constantly and consistently failing us.

The people are losing hope.

We need a new system.

Wed, 2011-08-24 15:11 — james (not verified)

Nowhere in your article do you mention the source of trade union donations - trade union members who are supporters of the party, choosing to donte through their union.

Why it would be any surprise that a party of labour should depend on funds from working people I do not know. If the money does not come through Labour supporters, where does it come from?

Wed, 2011-08-24 15:46 — Callum W (not verified)

The fact is that the Unions are the largest democratic organisations in Britain, representing about 7 million people. The point of the Labour party was/is that it allows for the political representation for these workers. @swatantra nandanwar, if you look at the union membership much of it is in fact comprised of the "middle class" you refer to. I dont feel like the UK is crying out for another party funded and run in the interest of capitalists. I would call for the left-wing unions such as the RMT to affiliate to labour in order to win a political battle againsts the blairites, millibands and the pro-business wing of the party. A party representing the working class majority is a vital.

Wed, 2011-08-24 15:59 — writeoff (not verified)

This is a scandal. The notion that hundreds of thousands of people are prepared to dip into their pocket and donate to a political party to act in their interests flies in the face of democracy. Fortunately, the Unions do next to nothing to bring pressure to bear on Labour, and stood idly by as the New Labour project put the boot into the Post Office, continued the marketisation of the NHS and ran the place into the ground. Three cheers for freedom etc.

Thu, 2011-08-25 17:13 — Marcus (not verified)

@ Union Steve - Its time we had a seismic change and freedom was restored.

Only a libertarian party would give you this.

Wed, 2011-08-24 16:32 — swatantra nandanwar

As has been pointed out before the 'working class' are an ever dwindling minority, whereas the 'middle class' are expanding and include a lot of the 'working classes' who now see themselves as middle class with all the problems of he squeezed middle.
So Labour must be a Party of the squeezed middle class as well as the Party of small business, otherwise its going nowhere. Labour will have to learn to love small business.

Wed, 2011-08-24 16:36 — Sue Davies (not verified)

As I understand it, since Ed Miliband's election, Lord Sainsbury has withdrawn his millions from the LP and is now funding Progress and Movement for Change. I believe that Pzifer and Bell-Pottinger have followed suit, which begs the question of their influence on distorting the democratic process within the LP.

If this is the sort of diversification of funding that you are calling for ... I'd rather stick with trade unions.

Wed, 2011-08-24 17:05 — Natacha Kennedy (not verified)

The £50K cap can be got around by employing a good firm of accountants. Unions can still donate via charities, community organisations and shell companies set up to enable donations to come through a variety of sources. Indeed if 26 organisations, including unions donate £50,000 each, that is half the amount they contribute already. Let's face it businesses use creative accounting all the time, so there's no reason why unions and the Labour Party cannot do the same thing.

Wed, 2011-08-24 20:34 — saltyseadog1

I agree with Marcus, I have supported Labour since 1968 when I was 18 but revoked my membership after expecting so much from the Blair era and then finding that he was just a tory in disguise. When Ed Milliband became leader I got my hopes up and rejoined. I doubt very much that I will be renewing it though. It becomes clearer and clearer that these modern career politicians just don't have a clue or maybe it is me and the whole idea is to alienate as much of the voting public as possible and then only have to get a majority from a minority. As people like me, and we are many, feel more and more disconnected and unrepresented in the political process then the likelihood of civil unrest becomes more and more foreseeable.