LABOUR faces a new cash crisis amid warnings that Britain’s biggest trade union is poised to end party donations worth more than £3m a year.
Westminster insiders believe that Unite, which has almost 2m members, is about to be taken over by left-wing insurgents who will sever the historic financial link with the Labour party.
The claim comes a week before the annual TUC conference where union members are expected to criticise the performance of the Labour government.
The union, whose donations account for more than 15% of the total money given to Labour, will next year elect a new general secretary to replace the joint leaders Tony Woodley and Derek Simpson.
The man emerging as the frontrunner to succeed them is Jerry Hicks, a former union convenor who has pledged to follow the examples of the RMT rail union and the Fire Brigade Unions, which have ended donations to Labour.
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“I absolutely say [I will] only support those who support our policies,” said Hicks.
His running mate, Rob Williams, a member of the Socialist party, went further. “The link with Labour is an absolute millstone round the neck of the union” he said. “It’s got us nowhere.”
Union insiders believe that the candidates’ anti-Labour message is gaining support among moderate union members. “There is an anti-Establishment mood building,” said one official.
A Populus poll for the Conservatives conducted early this year found that 49% of Unite members opposed donations to Labour.
Unite is not the only big union to be considering an end to Labour donations. The CWU postal workers union, which was fiercely critical of the government’s abortive plan to part-privatise the Royal Mail, may sever its links.
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About 80% of Labour’s donations come from trade unions and dependence on union barons could increase still further if the party loses the next election. Labour is burdened with around £25m of debt and any cut in union payments could easily drive the party into bankruptcy.
Unite is a powerful force within the Labour party. It financially backs dozens of individual MPs. Its political secretary, Charlie Whelan, Brown’s former spin doctor, is so influential that he has been dubbed the “real” Labour general secretary.
The union’s deputy general secretary, Jack Dromey, is the husband of Labour’s deputy leader Harriet Harman.