From the Guardian:
Labour is facing a fresh party funding row over proposals that would give it control over hundreds of thousands of pounds of extra funds raised from union members.
The plans have so incensed one of the UK’s biggest trade unions that it has threatened to cut its ties with the party, the Guardian has learned. The GMB – the third largest union in Britain and one of the party’s biggest donors – has said it will ballot its members if the new proposal to change the way unions contribute to Labour is included in a white paper on party political funding to be published next month.
The row centres on plans floated by the justice secretary, Jack Straw, said to be backed by Gordon Brown, to insist that all the money raised by 4 million trade unionists affiliated to Labour is paid directly to party headquarters.
The proposal would boost Labour’s coffers at the party’s cash-strapped HQ by millions of pounds and strip union leaders of the power to decide how they allocate the cash to local parties. It would also reduce the unions’ autonomy to spend the money on other campaigning issues, including fighting the BNP. Another of the country’s big unions, Unison, is also understood to be unhappy about the plans.
Paul Kenny, general secretary of the GMB, said: “The government is going down the wrong road and taking the wrong direction. There is no way we are going to concede the right to allocate their cash to Gordon Brown and the party headquarters when not all our members support everything that the government is doing. Not all our members support the Labour party and they would not stand for their money being used in this way. They would want us to disaffiliate if the government insists on doing this.”
John McDonnell, Labour MP for Hayes and Harlington, said: “This proposal will be opposed by MPs and rank-and-file members across the Labour party. It gives Labour party headquarters the right to take over control of all trade union money and is unacceptable.”
Returns from the Electoral Commission for last year show that the GMB gave £1.4m to Labour. Some £926,000 was paid directly to party HQ but in addition, the union gave nearly £500,000 to local constituencies or Labour local government campaigns such as in Brighton and Hove. Under the new proposals, that sum would go straight to Labour HQ.
Kenny estimates Labour would stand to gain up to £750,000 a year from the GMB alone. Some of the money the union spends is specifically targeted at campaigns against government policy, such as the closure of Remploy factories.