Friday, October 26, 2007

The Union Modernisation Fund still allows the Unions to buy taxpayers' money

Labour haven't had the easiest time fundraising over the last few years. The honours scandal was both symptom and, in turn, cause of that weakness. In 2005 they created the Union Modernisation Fund. Possibly the most venal act of the Labour government.

Francis Maude was right to describe it as "very, very direct sleaze. That is buying influence and buying taxpayers' money." Guido's graphic sums up the process nicely:

The Government's rationale for this is that the unions increase productivity and this would help them continue to do so. This doesn't fit the historical record, union power led to a dismal productivity record that only improved when Thatcher weakened the unions enough that working practices could be reformed. Even if unions did improve productivity there is little reason to think that giving them money to train their senior officers or produce an elaborate website would strengthen that effect.

On 11 September this year the second round was announced (DOC). The big unions, USDAW, CWU, NASUWT and others, got more taxpayer money. Some unions that don't donate to the Labour party also got funds but that's a pretty thin smokescreen, it only means anything if you assume the Government have some aversion to spraying taxpayers' cash around. It doesn't make this scheme look any less like an elaborate laundering of taxpayers' money to me.

What I didn't know until today was the identity of the head of the Union Modernisation Fund Supervisory Board. Under any honest scheme the UMFSB's chair would be a disinterested sort who could provide an independent perspective on the unions' projects and assess which would best contribute to an efficient workplace. Instead, we have Sir Bill Connor. He left a senior position in the union movement, General Secretary of USDAW, the shop-workers union, and, went straight across to head the agency supervising the distribution of Union Modernisation Fund money. Some of the money even goes to USDAW. The Government doesn't just fund the unions, it allows them to distribute it themselves.


Anonymous said...

to be honest i'd favour a rule whereby orgnaisiaons ( charities, buisness or unions) that get above a cerinat % of thier income from government couldn't donate or politicaly campaign.

if we did that it might then make sense to relax the rules otherwise on political campaiging by opt in charities (ie not student unions or similar bodies) since the worry about indirect biased taxpayer funding would not allow

Anonymous said...

I hadn't heard about this until now. I can't help but wonder why the media seem to have ignored it.

Gerrymandering seems too small a word and the whole thing makes the 'Cash for Honours' scandal look inconsequential.

I hope it is picked up by the mainstream media as yet another example of the tricks of this 'whiter-than-white' sleaze-ridden Labour Party.

Dave Cole said...


When you join a union that's affiliated to Labour, you have to tick a box to positively opt-in to paying extra on your union dues - the political fund. That is a choice by the individual and, indeed, the unions can give it to any party or parties that they, collectively, believe will support their members' interests. No money from people who do not opt-in goes to the Labour party.

I believe the technical term is Chinese Wall.

Matthew Sinclair said...

Dave, that's a much less important point than you seem to think it is.

Whether the decision to take part in this laundering scheme belongs to the union leaders or its membership is largely immaterial. Either way they are choosing to have their union by taxpayers' money through the Labour Party which is plain corrupt.