Labour's financial dependence on the trade unions has been exaggerated

Just 25 per cent of the party's funding so far this year has come from affiliated unions, with party members donating most.

The GMB's decision to cut its affiliation fees to Labour from £1.2m to £150,000, in advance of Ed Miliband's plan to introduce an opt-in system for trade union members, has refocused attention on the party's relationship with the unions.

Judging by David Cameron's rhetoric, it would be easy to believe that Labour is entirely dependent on them for funding. But while it's true that the latest Electoral Commission figures show that affiliated unions were responsible for 77 per cent (£2.4m) of all donations to the party in Quarter Two, the true picture is more complex. 

The Electoral Commission doesn't publish donations below £7,500, so the funding Labour receives from its 187,537 members isn't included. In reality, as the table below shows, just 25 per cent of Labour funding so far this year has come from affiliated unions, with 29 per cent from members' subs, 22 per cent from grants and 25 per cent from fundraising and commercial sources. 

Labour will certainly suffer a major funding hit from Miliband's union reforms. The party expects around 10 per cent of the existing 2.7 million levy-payers to opt-in, which would reduce the amount it receives in affiliation fees from £8m to around £1m (although it is likely to increase the annual £3 payment). But its dependence on the unions has been much exaggerated.

Unite general secretary Len McCluskey. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Tom Watson rouses Labour's conference as he comes out fighting

The party's deputy leader exhilarated delegates with his paean to the Blair and Brown years. 

Tom Watson is down but not out. After Jeremy Corbyn's second landslide victory, and weeks of threats against his position, Labour's deputy leader could have played it safe. Instead, he came out fighting. 

With Corbyn seated directly behind him, he declared: "I don't know why we've been focusing on what was wrong with the Blair and Brown governments for the last six years. But trashing our record is not the way to enhance our brand. We won't win elections like that! And we need to win elections!" As Watson won a standing ovation from the hall and the platform, the Labour leader remained motionless. When a heckler interjected, Watson riposted: "Jeremy, I don't think she got the unity memo." Labour delegates, many of whom hail from the pre-Corbyn era, lapped it up.

Though he warned against another challenge to the leader ("we can't afford to keep doing this"), he offered a starkly different account of the party's past and its future. He reaffirmed Labour's commitment to Nato ("a socialist construct"), with Corbyn left isolated as the platform applauded. The only reference to the leader came when Watson recalled his recent PMQs victory over grammar schools. There were dissenting voices (Watson was heckled as he praised Sadiq Khan for winning an election: "Just like Jeremy Corbyn!"). But one would never have guessed that this was the party which had just re-elected Corbyn. 

There was much more to Watson's speech than this: a fine comic riff on "Saturday's result" (Ed Balls on Strictly), a spirited attack on Theresa May's "ducking and diving; humming and hahing" and a cerebral account of the automation revolution. But it was his paean to Labour history that roused the conference as no other speaker has. 

The party's deputy channelled the spirit of both Hugh Gaitskell ("fight, and fight, and fight again to save the party we love") and his mentor Gordon Brown (emulating his trademark rollcall of New Labour achivements). With his voice cracking, Watson recalled when "from the sunny uplands of increasing prosperity social democratic government started to feel normal to the people of Britain". For Labour, a party that has never been further from power in recent decades, that truly was another age. But for a brief moment, Watson's tubthumper allowed Corbyn's vanquished opponents to relive it. 

George Eaton is political editor of the New Statesman.