Labour and the unions: Now the ball is in the Tories’ court

In the wake of today's speech Ed Miliband will face the biggest test of his leadership thus far - and it is a test of his own making.

In the wake of today’s speech Ed Miliband will face the biggest test of his leadership thus far; and it is a test of his own making.

In announcing that he will end the automatic affiliation fee paid by union members to Labour, Miliband is making party funding more transparent.

In the process he is also raising the spectre of a funding shortfall should union members opt on mass not to give money to Labour.

In other words, we don’t yet know what the real impact of the reforms announced today will be. Miliband himself has admitted that the changes will have “massive financial implications for the party”, and these “implications” will only become clear in time.

There are grounds for cautious optimism, however. Yesterday Left Foot Forward came up with a list of five party reforms which we believe Ed Miliband should consider. We’re pleased to note that many of these have either been adopted by Ed or featured in some form in his speech today.

While the media will undoubtedly focus on the end to automatic affiliation, there were other announcements that warrant just as much attention.

Yesterday we called for a spending cap for candidate selections. Today Ed announced that the party would be adopting such a measure.

This is an incredibly important move which would help to ensure that standing as a Labour candidate is less dependent upon money than it has been in the past – whether union money or private money.

Miliband also mooted the idea of open primaries – to start with in London Mayoral contests but with an eye to broadening the franchise to other elections if successful.

Left Foot Forward has long been a proponent of some form of primaries. As well as potentially energising many Labour supporters to get involved in the selection of candidates, the prospect of primaries will worry the Tories, with Cameron under pressure to follow suite in backing primaries but fearful of further grassroots rebellian.

There were also calls by Ed for all-party talks around a cap on large donations to restart.

While many on the left will worry that this will hurt trade union donations to Labour, in reality it’s more likely to worry the Tories. 248 of the top 1,000 individuals featured on last year’s Sunday Times Rich List have financially supported the Conservative Party since 2001, with donations totalling £83.6m.

Lord Ashcroft alone has given £6.1m to the Tories since 2001.

In this respect Ed Miliband has put his cards on the table; now it’s the turn of the Tories to do so.

In dealing with the row between Labour and Unite which erupted last week, kudos must go to the Miliband party machine for a masterclass in triangulation. If you are able to get both Len McCkluskey and Tony Blair on board you are clearly doing something right.

Specifically credit must go to Labour general secretary Iain McNicol for handling last week’s fireworks so well – not easy given the media’s propensity to blow up all discord within the Labour ranks.

The challenge now will be to keep a lid on the predictable reaction from the Labour left. It’s right that leftists should get excised about talk of any Labour break with the trade unions. The link must be maintained and strengthened, not broken.

However that relationship must be updated for the 21st century. And both Labour and the trade unions must be openly funded and funded directly. This will be a challenge for both Labour and the unions; but a challenge is often what a movement needs to give it a kick up the backside and allow it to reinvigorate itself.

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