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EDITIONS
Friday, 9 August, 2002, 12:48 GMT 13:48 UK
Labour cash crisis prompts union gift
Labour Party finances
Party finances are said to be at their lowest point
Labour bosses have persuaded union leaders to make an emergency 100,000 donation towards regular running costs.

A special meeting of Labour's trade union liaison committee agreed the gift following an appeal from general secretary David Triesman, BBC News has confirmed.


I do not think it is any secret that the party does have some problems financially

Mick Rix

Labour's debts are already thought to amount to 9m and the new cash help underlines the extent of the financial crisis.

One leading unionist at the meeting said the idea of unions buying Labour's new headquarters was raised at the meeting.

Aid ideas

Mick Rix, general secretary of train drivers union Aslef, said the idea had been discussed briefly but was only one suggestion for practical help being floated.

"I do not think it is any secret that the party does have some problems financially," Mr Rix told BBC Radio 4's World At One programme.

The union chief explained that the 100,000 donation was money already set aside in the trade union liaison body and which had been brought forward.

Some unions are also considering bringing forward their affiliation fees, said Mr Rix.

But he thought fees for individual members could also be increased according to how much people earned.

Some unions, including the CGWU and the GMB, have cut the amount of money they give to Labour.

No cash for policies

Rail workers union the RMT is now only funding Labour MPs who espouse the policies it supports, including railways denationalisation.

Mr Rix said any notion of "cash for policies" was wrong.

One union leader present The Guardian it was made clear the party "was in desperate straits" and "at the edge" of its borrowing limit with the Co-operative Bank.

And the meeting, chaired by TGWU general secretary Bill Morris, was told Labour needed the money for wages, lighting, heating, printing and other expenses, according to the newspaper.

The plea followed a series of cuts in regular donations from unions unhappy with government policy.

Labour's donations fell from to just 591,052 in the three months to June from 3,379,641 in the previous quarter, according to an Electoral Commission report.

Big corporate donors have reportedly been scared away by sleaze allegations.

Scandals

Labour decided to return a 1m donation from Formula One boss Bernie Ecclestone, after motor racing gained a stay of execution from a ban on tobacco advertising.

Last week an internal party document obtained by the BBC revealed the party was 6m in debt.

The document, which was sent to members of Labour's National Executive Committee, says: "Sizeable repayments to the bank are expected in 2003.

"This was not the case in 1999 and represents a significant challenge."

The unions cash help came as former minister Peter Mandelson said unionists should not use their privileged position to try to change government policies.

Mr Mandelson has said the party's debts should be no surprise in a post-election year.

See also:

22 Jul 02 | Politics
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12 Jun 02 | Politics
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03 Jan 01 | Politics
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