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The end of Labour? The Collins Report and the Labour Party-Trade Union alliance by Dr David Stewart

Dr David Stewart is course leader for the BA History, BA Modern World History and BA History, Museums and Heritage programmes at the University of Central Lancashire. UCLan also offers joint degrees in History/Politics, Politics/Social Policy and Politics/Philosophy.

Dr David Stewart
Dr David Stewart

David’s publications include The Path to Devolution and Change: A Political History of Scotland Under Margaret Thatcher (International Library of Political Studies), The British Labour Movement and Imperialism, and Hidden Alternative: Co-Operative Values, Past, Present and Future

The publication of the Collins Report could prove to be a seminal moment in the history of the Labour Party-trade union alliance.

The report proposes to replace the current process whereby trade unionists who do not ‘contract out’ of the political levy are automatically and collectively affiliated to the Labour Party with a new process that requires trade unionists to ‘contract in’ to individual Labour Party membership.

The Labour Party leader, Ed Miliband, contends that the proposed changes will unlock the activist potential of the 3 million trade unionists currently affiliated to the party and compel the party leadership to become more attuned to the views of ordinary workers.

However, the Collins Report’s claim to work ‘with the grain of the last big reforms of 20 years ago’ raises the question of how far the recommendations represent continuity with the ‘New Labour’ project.

This article will analyse two key aspects of the Collins Report, the drive for mass membership and reform of the political levy, in the context of the history of the Labour-union alliance. Before doing so the binding elements of the relationship will be outlined.

The binding elements of the Labour-union alliance
In 1900 a Trades Union Congress-organised conference agreed to establish, ‘a distinct Labour group in Parliament’.

The unions’ involvement was crucial to providing mass membership, finance and organisation that would have otherwise been beyond the means of the party.

The unions’ partnership with Labour would underpin the party’s claim to represent the working-class.

Lewis Minkin has summarised the binding elements of the party-union partnership as follows: working-class political representation; advocacy of working-class and trade union interests; labour movement solidarity and consciousness; shared values; and trade union finance.

The quest for mass membership
By setting out a ‘bold vision’ to ‘build Labour into a mass party’, the Collins Report writes another chapter in the history of Labour’s efforts to expand party membership.

Prior to 1918 membership was entirely composed of affiliated organisations and individual membership was not possible. However, in 1918 Labour devised a new party constitution that enabled individual membership of newly created Constituency Labour Parties (CLPs), while allowing the unions to retain a dominant role through their control of 90% of votes at the party conference, which was to be responsible for electing the party’s main decision making body, the National Executive Committee, and deciding party policy.

In effect, the unions would manage Labour in partnership with the party leadership.

Local trade union branches could fund up to 80% of a sponsored candidate’s election expenses, enabling unions to exert considerable influence over the selection of candidates in safe Labour Party seats and discouraging local recruitment and fundraising.

During the period 1945-1970 the percentage of trade union sponsored Labour MPs rose from 30.8% to 40.3% while party membership dropped from a peak of 1 million to 680,000.

This fall in membership coincided with a breakdown in the unions’ traditional managerial role as influential unions made common cause with constituency activists against the party leadership over the Wilson and Callaghan governments’ attempts to reform industrial relations.

After the disastrous 1983 General Election defeat, the unions resumed their managerial role in support of the party leadership, making a vital contribution to the marginalisation of left-wing activists and expulsion of the Trotskyist Militant Tendency. Although party membership fell to 280,000 in 1992, the percentage of union sponsored Labour MPs increased to over 60%.

Nonetheless, in 1993 unions reluctantly accepted the introduction of One-Member-One-Vote for candidate selections ending the practice whereby local union representatives wielded collective block votes.

Therefore, in the period 1918-1993 the party-union relationship impeded the growth of individual membership but it also proved crucial to party management by limiting the influence of constituency activists at party conference and over local candidate selections.

Tony Blair’s election as Labour Party leader in 1994 represented a watershed.

He viewed the unions as a conservative, sectional influence in the party, impeding his efforts to modernise policy and broaden the social base of party membership and candidates.

Under Blair’s leadership, Labour would gradually sever and downgrade most of the binding elements of the party-union alliance.

Blair minimised dialogue with union leaders in an attempt to enhance Labour’s electability and maximise the autonomy of the party leadership, removing any semblance of partnership in managing the party.

Union block votes at party conference were progressively reduced to 50% of all votes and union sponsorship of Labour candidates was ended in 1995, undermining working class political representation and labour movement consciousness.

Membership rose to 405,000 in 1997, but by 2009 it had contracted to a record low of 160,000. New Labour’s failure to achieve mass membership ensured that the binding element of union finance remained intact, enabling the unions to retain a foothold in the party.

The political levy
The Collins Report’s proposal to require trade unionists to ‘contract in’ to the political levy directly challenges the final binding element of the party-union alliance and contradicts Labour’s traditional stance on this issue.

Prior to the introduction of the payment of MPs in 1911, a trade union parliamentary fund financed by a political levy of one-penny-per-member-per-year was used to pay Labour MPs.

In 1909, however, the Law Lords declared union expenditure on political objects ultra vires.

From 1913 onwards trade unions intending to engage in party political activity were required to establish political funds.

These funds were subject to approval in membership ballots, and members who did not wish to contribute towards them were entitled to ‘contract-out’ of political levy payments. Unions could hold an unrestricted number of ballots, but, once approval had been attained, they were not obliged to re-consult their members.

Following the 1926 General Strike, the Conservative Government responded to back-bench pressure and compelled trade unionists to ‘contract-in’, convinced that the ‘silent majority’ of union members, who did not support the Labour Party or were not politically motivated, would allow their political levy payments to lapse.

The 1927 Act reduced Labour’s income from trade union affiliation fees by one-third, whereas the reinstatement of contracting-out in 1946 doubled the number of trade unionists affiliated to Labour. The issue remained non-controversial until the election of Margaret Thatcher.

Thatcher compelled all unions to hold decennial ballots to approve their political funds, but stopped short of reintroducing ‘contracting in’ as she realised that it would precipitate pressure to change the system by which companies donated to the Conservatives.

The unions had provided 98.4% of the Labour Party’s 1983 general election campaign funding and the party feared losing a substantial proportion of this income. However, much to Thatcher’s surprise the number of unions affiliated to Labour increased as a result of these ballots, legitimising the collective financial basis of the party-union relationship.

Despite this success, Blair spoke of his admiration for the ‘pro-business’ ethos of the American party system and actively sought to reduce reliance on union funding by courting wealthy donors.

This would lead to a police investigation in 2006 into allegations that Blair was offering peerages to wealthy individuals in return for large donations to the Labour Party.

Yet, between 2001 and 2011 Labour remained reliant on the unions for 63% of its funding. Therefore, since Labour’s inception ‘contracting in’ has been advocated by the party’s opponents on the centre-right of the political spectrum, who hoped to undermine Labour’s main source of finance and attack the collective legitimacy of the party-union alliance.

A historic gamble
In seeking to build upon New Labour’s onslaught on the party-union relationship, the Collins Report’s recommendations represent a historic gamble.

If as the unions estimate fewer than 10% of the 3 million trade unionists currently affiliated to Labour opt to ‘contract in’, the party runs the risk of severely damaging its already fragile finances.

Moreover, such an outcome would destroy the legitimacy of the collective party-union alliance and with it Labour’s historic claim to represent the working-class.

Published 19th January 2014