The Labour Party is squeezing its MPs for money to stave off an imminent financial crisis.
MPs this week received letters demanding cheques for up to £2,200 each in personal contributions.
Although compulsory ‘donations’ are not new, MPs claim they are being pressed harder because of massive debts run up by Tony Blair and fundraiser Lord Levy to pay for the 2005 general election.
Senior MP Austin Mitchell commented: ‘It’s called ‘arrears’ for 2008/09.
‘But we’re only two months into that. They must be collecting all they can to pay off our £24 million short-term debt.
‘So we’re going to be dunned because Tony and Levy put us into a financial black hole. What a mess.’
A Labour spokesman confirmed that letters had been sent out but denied that the levy -equivalent to two per cent of salary -had been increased.
It said Mr Mitchell was sent a higher demand because he had fallen behind on paying last year’s levy. But writing on his website diary, the Great Grimsby MP said some backbenchers wanted to bale out their local branches rather than the national HQ: ‘We tried to give MP donations to our local parties.
‘With declining membership and so few councillors they’re bankrupt too. Our first priority is to help them.’
New Labour will be turning to the labour movement to beg for cash, but as Simon Basketter writes in this week’s Socialist Worker, “Unions shouldn’t pay Labour’s bill“:
Gordon Brown is attacking workers’ living standards while asking the unions to bail out the Labour Party. The rich backers who lent the party money now want it back.
In the next month Labour needs to come up with £7.45 million to pay off the loans from banks and wealthy businessmen secured by Lord Levy, or face insolvency.
The party is at least £24 million in debt. The members of the party’s ruling national executive committee (NEC) are all liable for the debts.
This has led the GMB union to indemnify its members on the NEC to protect them. In effect it has guaranteed the loans with union money.
The government’s desire for more union money has opened up a debate on the relationship between the unions and Labour.
Derek Simpson, the joint general secretary of the Unite union, called for “New Labour” to be consigned to the history books at the union’s sector conference in Brighton this week.
He said, “It is not the differences between Gordon Brown and Tony Blair that are the problem. It is the similarities.
“For years the labour movement held its breath expecting change after the departure of Tony Blair. While we went blue from the lack of oxygen, the country has gone blue for the lack of social change.”
Despite his criticisms, Simpson added, “We’ll be using our influence as Labour’s biggest affiliate and its biggest financial supporter.
“Not by destabilising threats of removing financial support but rather through persuasion and demonstrating that our policies are popular with traditional Labour voters.”
Paul Kenny, the general secretary of the GMB union, which has given £10.6 million to Labour since 2001, says his members are “increasingly frustrated” with New Labour.
Kenny said, “We need clear policy directives people can understand. We represent 600,000 people and their families. If you don’t listen to what they’re saying, you lose their vote.’’
Radical rhetoric aside, Brown is set to do his listening at Labour’s National Policy Forum in July, which is set to launch a “Warwick 2” agreement.
The 2004 Warwick agreement saw Labour make more than 50 pledges in return for £10 million from the unions.
The agreement sealed union support for the 2005 general election. It was supposed to provide the basis of a pro-union Labour third term.The promises proved empty then. They are likely to again.
Union leaders have hinted that they want rules on balloting for industrial action changed, companies to be legally obliged to carry out “equal pay audits” and workers in companies subject to private equity takeovers to have their rights protected.
But business secretary John Hutton has ruled out more legislation on workers’ rights.
Hutton said, “In future, beyond minimum standards, we must place increasing emphasis on government creating the opportunity for workers and businesses to work out what is best for their own circumstances.”
Chancellor Alistair Darling has also bowed to bosses over proposed minor changes to the taxation of foreign profits by agreeing to give a new forum of multinational executives “key input” into the proposals.
This will include Julian Heslop of Glaxo Smith Kline, and Douglas Flint of the HSBC bank.
While the government panders to every whim of business, trade unions are supposed to foot the bill.
Some 82 percent of Labour’s funding in the first three months of this year came from the unions. There is no reason to give any more without getting a great deal in return.
Instead of waiting for promises from Brown, unions should stand up for their members’ rights. The battle over public sector pay cuts is a vital focus.
As Kevin Courtney, of the NUT teachers’ union executive, told a fringe meeting at the UCU conference last week, “There is a fear among some about rocking the boat for Labour. But we should be demanding that other unions act now.
“We can’t avoid the argument about Labour. I don’t want a Tory government as I think that would be worse. But we only win things by fighting. We have to keep fighting against Labour to win our demands.”
PAY CUTS, RECESSION & RESISTANCE
This new Socialist Worker pamphlet explains why the bosses and the Bank of England expect workers to pay for their economic crisis, how Brown is attacking wages – and how pay freezes were beaten in the past
To order your copy phone 020 7819 1175