National Executive Committee, 14 December 2006
The NEC
was not due to meet again until January, but dramatic
developments on the party funding front saw members
summoned for an emergency session. Was it all a storm
in a teacup? I was not privy to all the conversations
behind the scenes, but when a meeting is called at 24
hours’ notice, ten days before Christmas, it suggests
serious deficiencies either of communication or of
substance.
First
we dealt with a couple of routine matters. The officers
proposed a National Policy Forum (NPF) early in 2007 to
discuss the work of the cabinet policy review groups,
and to consider the defence white paper on Trident.
Pete Willsman and Walter Wolfgang argued that the NPF
should express a view on Trident through voting, but
given the Forum membership, and the fact that the unions
will put deals on pay and rations ahead of foreign
policy as they did at Warwick, a vote would probably not
help the cause. In any case it is the Joint Policy
Committee, not the NEC, which manages the NPF. The NEC
agreed that the Forum should go ahead, with Walter
opposed. I voted in favour, as with the November
meeting already cancelled, the NPF was at risk of
subsiding into complete irrelevance.
The
officers also recommended moving the 2008 annual
conference from Brighton to Manchester, after positive
feedback this year. (The 2007 conference would remain
in Bournemouth, 2009 in Brighton and 2010 in Manchester,
as previously agreed.) Walter and Christine Shawcroft
were concerned about the shortage of reasonably-priced
rooms for constituency delegates, but the general
secretary assured us that this was being addressed. I
supported the change as Brighton also has accommodation
issues, and it is not fair to expect delegates from
Scotland and the north to trek down to the south coast
every year. Again this was carried with Walter against.
Party Funding: Facts and Rumours
Mike
Griffiths and Hazel Blears summarised the story so far.
In the wake of the loans affair, Sir Hayden Phillips was
charged with reviewing party funding. A working group
chaired by Jack Straw oversaw the drafting of Labour’s
submission, agreed by the NEC and by conference. On 16
November Hayden Phillips published an interim report
posing specific questions, including whether there
should be a limit on donations. The Labour party
responded in line with conference policy. On 4 December
Hayden Phillips issued more detailed proposals. Some
were regarded as acceptable, including increased
transparency, better enforcement, national and local
spending limits, and state funding for purposes such as
training candidates and improving feedback from
Partnership in Power.
Others
were alarming. All donations, from individuals and from
organisations, would be capped. Trade unions would no
longer operate a collective system of affiliated
membership through their political funds. Instead
affiliation would become “individualised”: the party
would have to write to over 3 million union members,
every year, explaining how their contribution had been
spent and reminding them that they could choose to stop
paying. As Hayden Phillips said, in a masterpiece of
understatement, “the proposals will be especially
demanding for the trade unions. They will need to
introduce new systems and new accounting arrangements”.
And for the party, the average affiliation payment of £3
a year would be entirely consumed by paperwork. A
Thatcherite dream come true.
What
really fuelled the anger was Hayden Phillips’ claim that
these plans enjoyed consensus across the parties,
leading to a widespread belief that Number 10 insiders
were conducting parallel negotiations on their own
agenda. Tony Blair was unable to attend the NEC, but
John Prescott assured us that the leader had never had
any extra meetings nor departed from the conference
mandate. Other ministers made it clear that they would
not introduce laws opposed by the entire parliamentary
party.
Back
from the Brink
Mike
Griffiths’ statement, printed below and agreed
unanimously, dealt with most concerns. Dennis Skinner
argued that union money was clean, given because of
shared values and not to buy influence. Others said it
was ridiculous to impose the same donation cap on
Amicus/TGWU with 1.75 million members as on unions with
a few thousand, and there were only 17 unions affiliated
to Labour, against hundreds of Tory-supporting
companies. And I pointed out that general secretaries
no longer wield block votes in electing party leaders
but must ballot their levy-payers, giving them a
democratic voice.
There
will now be more discussions, but Hayden Phillips
intends to conclude by the end of January. The NEC were
still worried that he did not fully understand the
party’s federal structure, and rejected any outside
attempt to rewrite our rulebook. Members hoped he would
not wish to appear as a Tory patsy and would listen
again to our proposal for voluntary systems of donations
appropriate to each party’s traditions and statutorily
enforced. All agreed that the party must speak with one
voice.
However, dangers remain. Party negotiators are keen for
speedy curbs on local expenditure, with Tory millions
already pouring into key marginals. They would also
prefer cross-party consensus, because without it we risk
ending up on the wrong side of the argument and bogged
down in the Lords. My view is that there are even worse
options than the status quo, and conceding too much
would make spending limits irrelevant because we would
have no income. Tony Blair once paid tribute to those
who stuck with the party during the years of opposition,
when business didn’t want to know, and our high- value
donors were backing the SDP. Without the unions there
would have been no Labour victory in 1997, and it is
sheer arrogance to think that we may never need that
solidarity again. Some members still suspected
Blairites of using Hayden Phillips to pursue their
original project of breaking the union link. That may
have seemed a viable alternative when individual
membership was 400,000 and rising, and the world was at
our feet. Now it looks like political suicide. The
survival of our party, and of a healthy democracy, are
at stake.
Questions and comments are welcome, and I am happy for
this to be circulated to members – and supporters - as a
personal account, not an official record. Past reports
are at: www.annblack.com
Statement from Mike Griffiths, Chair of the NEC on
behalf of the full NEC:
The
Labour Party has led the way in introducing
transparency into British politics culminating in the
Political Parties Elections and Referendums Act
(2000). We therefore welcome the Hayden Phillips
enquiry into the future of political funding.
The
time has come to end the "arms race" on election
expenditure, with a cap on what parties can spend,
nationally and locally and for the lifetime of a
parliament. The Labour Party National Executive
Committee (NEC) is therefore encouraged by the proposals
from Sir Hayden regarding the principle of reducing the
spending of political parties.
After
consulting with Party members, the Labour Party
Conference in 2006 unanimously approved the Labour
Party's detailed submission to the Review on the Future
of Party Funding currently being conducted by Sir Hayden
Phillips.
The
position of the Labour Party, at all levels, has been
and remains that as set out in our submission. This
position was reiterated by the Prime Minister attending
the Parliamentary Labour Party Committee on Wednesday
where he made clear that nothing should break the
historic link between the Labour Party and the Trade
Unions. The NEC therefore rejects those proposals from
Hayden Phillips that clearly neither respect nor
understand the structures and constitution of the Labour
Party.
In the
Labour Party submission to the review we express the
view that any changes need to be workable, respect
differing party structures and constitutions and should
not reduce fairness and equality by giving one party a
funding advantage over another. For that reason, in our
submission we made it clear that the Labour Party cannot
accept a statutory uniform donation cap as proposed by
the Conservative Party.
This
form of donation cap would quickly become unworkable
logistically and diminish the political voice of
hundreds of thousands of trade unionists at a time when
all parties are concerned with widening political
engagement. It would also undermine the Labour Party
federal structure and seek to amend a system of Trade
Union contributions that is already highly transparent
and heavily regulated.
Officers and officials of the NEC will continue to
vigorously pursue the Labour Party's position in all
discussions with Sir Hayden Phillips.