Labour and Unite at war: McCluskey accuses party HQ of a "stitch-up"

The Unite general secretary hits back after Labour announces the end of the "union join" scheme and suspends Unite candidate Karie Murphy from the party.

After weeks of criticism over Unite's alleged manipulation of the Falkirk selection process, culminating in the resignation of Tom Watson earlier today, the Labour machine has swung into action tonight. The party has announced the end of the "union join" scheme, which allowed trade unions to pay the first year's subscriptions of party members they recruited, and has suspended Karie Murphy, the Unite-backed candidate in Falkirk, and Stephen Deans, the chair of Falkirk CLP, from the party. Here's the full statement:

“We announced on 26th June that the General Secretary was going to review membership procedures.

“Ed Miliband is determined to uphold the integrity of Parliamentary selections and, therefore, as a result of that review we have several more measures to announce today.

In the light of the activities of Unite in Falkirk we will end the ‘union join’ scheme.

“Union join was established before Ed Miliband became Leader of the Labour Party with the aim of legitimately encouraging ordinary members of trade unions to become members of the Labour Party.

“However, due to the results of Unite in Falkirk it has become open to abuse but also open to attacks from our opponents that damage Labour. 

“In particular it was a mistake to have a scheme where others pay for people to join the party. Ed Miliband has today ended the scheme. Ordinary members of trade unions should join Labour and they will continue to be encouraged to do so, but that cannot be through schemes that can be tied to individual parliamentary selections or open to attack from our opponents.

“We have also suspended two members of the Labour Party from holding office or representing the Labour Party.

“They are: Karie Murphy and Stephen Deans who is the chair of Falkirk CLP.

“There have been allegations that they may have been involved in a breach of Labour Party rules. These relate to allegations concerning potential abuse of membership rules.

“The administrative suspension means that you cannot attend any party meetings and that they cannot be considered for selection as a candidate to represent the Labour Party at an election at any level.”

In a letter to Labour general secretary Iain McNicol this evening, Len McCluskey has responded by accusing the party HQ of a "stitch-up" and demanding an independent inquiry into the Falkirk affair. Here's his letter in full:

"Simply a ‘stitch-up’ [the report] designed to produce some evidence, however threadbare, to justify predetermined decisions taken in relation to Falkirk CLP. 

"Even on the basis of this flimsy report, it is clear that these decisions cannot be justified. There is no emergency which would justify imposing these undemocratic restrictions, since any real problems could easily be addressed before embarking on a parliamentary selection process. 

"The report has been used to smear Unite and its members. Even if the allegations of people being signed up to the party without their knowledge were true, this had nothing whatsoever to do with my union. 
  
"It is noteworthy that members of the shadow cabinet have been in the lead in initiating this attack upon Unite. Have they had sight of this report while I, the leader of the union put in the frame, has not had the courtesy of a copy? 

"The mishandling of this investigation has been a disgrace. I, however, am obliged to uphold the integrity of Unite, and I can no longer do so on the basis of going along with the activities of a Labour party administration in which I can place no trust. 

"I will therefore be publicly proposing that an independent inquiry be held into all circumstances relating to Falkirk CLP and the conduct of all parties involved, including Unite, the Labour party centrally (including the Compliance Unit) and in Scotland, the officers of the CLP itself, and all those who have sought or are seeking nomination as the Labour PPC. 
  
"Unite will cooperate fully with such an inquiry, and draw appropriate conclusions from any findings regarding our own behaviour. I trust that you will support such an inquiry, will direct all Labour party employees to cooperate with it and encourage other individuals to do likewise." 

Unite general secretary Len McCluskey. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.