Labour and the unions: Prentis lets the genie out

Astonished.

That was my response on seeing what Unison’s Dave Prentis told his conference yesterday, at which he effectively said that a number of Labour MPs risk losing union funding to their constituencies. “No more blank cheques”, says Unison’s press release. It doesn’t get much more blunt than that.

I wasn’t the only one. Sources tell me that very few people knew of the general secretary’s remarks before he made them. And the remarks themselves are both astonishing and important.

Astonishing because Unison has shown itself until now to be a diehard supporter of the Labour Party and the Labour Government (much though it criticises policies such as the Private Finance Initiative). It was simply not done to mention the money – millions of pounds – it pays to Labour Party HQ, MPs through their constituencies and for campaigning support, every year. Cash for policies was never raised – partly because it is a stick the Conservatives used to beat Labour with, accusing it of being under the thumb of unions. Until now.

Important because it’s a step change in how Britain’s biggest public sector union, and its second biggest union overall, works. Or as a senior Unison officer said: “The genie’s out of the bottle”. Other Labour-supporting unions such as the CWU get the chance to debate their political funding at their annual conference. Not Unison: the obscure Rule J (I’ll spare you the details) means that the topic is off-limits.

Constituency funds are managed by regional committees and, as late as last week, I was being told that the situation would remain thus. But the rules seem to have been, erm, worked around. I can reveal there was an emergency meeting of Unison’s national Labour Link Committee last night, described to me as a “formality”. Prentis has spoken. As an activist put it: “The old settlement of Unison Labour Link being an autnomous part of the union is gone.”

Labour Party staff ought to be sweating. This is another snapping of threads in the ropes holding Labour’s trade union link together. And the fact nobody saw it coming makes it all the more powerful.

P.S. Cynics may suggest this is why the list of Unison Labour MPs disappeared from Unison’s website a couple of weeks ago.

The BNP, Labour and the left: to egg or not to egg?

Yesterday I met someone who helped organise the protest at Nick Griffin’s open-air news conference next to Parliament on Tuesday, which culminated in Griffin being pelted with eggs and fleeing to his car.

Except that they didn’t pelt Griffin, or kick his car as it sped away. In fact, they were disgusted at the activists from Unite Against Fascism who indulged in such behaviour. Beside the egg-throwers on College Green were a group of trade union members from the Public and Commercial Services Union. Their plan was to shout Griffin down, using their own right to free speech to nullify his.

You may not think there’s much difference, but the differing tactics point up a divergence on the left and in Labour about how to deal with the BNP. Nowhere is this divergence clearer than in the London Borough of Barking and Dagenham, where the BNP are the official opposition on the council with 12 seats.

Supporters of Barking MP Margaret Hodge, who famously alienatedanti-BNP campaigners three years ago, say the best way to deal with them is to ignore the actual party while addressing the sensitive issues the BNP  uses to inflame popular opinion, like housing and other services. Meanwhile supporters of Jon Cruddas next door in Dagenham believe in the ‘Hope not Hate’ campaign run by Searchlight and heavily supported by unions. They prefer to target the BNP explicitly, refer to it by name and highlight what they see as their bonkers record in elected office. Even Searchlight and UAF, who broadly go for the same explicit approach, don’t get on.

The question of what to do with the BNP is an old one for Labour and the left. Labour’s disastrous showing in last week’s elections has brought it forward. But if Labour doesn’t come up with a coherent approach that its MPs and activists all agree on, they will suffer for it, just like they already have. More council elections are coming up next May, including… Barking and Dagenham.

P.S. Just found an interesting postfrom a Councillor Phil Andrews in Isleworth, an ex-National Front supporter and former friend of Griffin. A bit long, but it has some revealing details about the BNP’s workings (around the middle). He writes: 

“The BNP’s concerns… are not about numbers, nor for that matter about jobs, housing, education nor anything else of that kind. They are about race. Just as they were when I was involved with the far right. All that has changed, essentially, is the packaging.”

The NEC is proving key

On this “ever-intriguing” (thank you, Sam Coates) blog I recently wrote that Labour’s national executive committee was in a pivotal position to make or break Brown’s credibility over MPs’ expenses, after the setting up an endorsements panel or ’star chamber’ to hear MPs’ cases. And so it’s proved. One particular case could be a can of worms for the Prime Minister.

Norwich North MP Ian Gibson announced his resignation at the weekend, after the NEC panel barred him from standing for re-election (in turn after he’d said he wouldn’t stand).  Gibson was reported by his local paper (link above) as saying he agreed with his constituency chairman’s view that his barring was a “fait accompli” by the panel – despite the fact that, unlike two of his colleagues, he actually appeared before it. His reaction was “devastation”, which is presumably why he’s decided to precipitate a by-election.

Did he deserve it? Gibson spent around £80,000 on a second home in which his daughter and her boyfriend lived rent-free; then he sold it to them at below market price (not making a profit). It’s not clear that this breaches the spirit or letter of the rules.

By contrast Hazel Blears engaged in flipping of homes (living in three in one year), avoided paying capital gains tax on her second home and spent quite a lot on hotel bills. Again, no obvious breach of the rules. So why hasn’t she been dragged before the panel? Cynics might point to her voting record and say she was more loyal than Gibson – and more dangerous if provoked.

Appearances before the NEC panel are decided by chief whip Nick Brown and general secretary Ray Collins. More loyal Brown supporters you could not wish for.  Already there’ve been mutterings about the NEC-based procedure from, er, the NEC. Peter Kenyon wrote last month:

“As a member of Labour’s NEC, I have received a lot of angry emails and comments on my blogs about apparent anomalies in the treatment of different ministers, as well as between ministers and backbenchers. Some of this upset can be accounted for by shock about what has been going on in Westminster. Some can’t, perceptions of scapegoating can’t be easily brushed aside.

I would be very interested to hear from anyone who thinks they know of strong evidence of an anomaly, which I could add to a case I have already referred to the powers that be. Once reviewed and explained we need to be open about the reasons why apparently similar cases are being dealt with differently. Otherwise, there is no way in which party members’ confidence in the NEC and the Party Leader/PM is going to be restored, let alone that of the electorate in Labour’s competence to govern.”

Exclusive: Royal Mail sale is off

There’s been speculation over whether the bidders were putting in a good price, there’s been talk about putting off an auction. But it doesn’t matter anymore.

Last night’s difficult Parliamentary Labour party meeting, plus the House of Commons’ future business papers, make the situation clear: the Postal Services Bill that opens the door to up to half of Royal Mail being sold off, has been dumped from the Government’s legislative programme. Harriet Harman refused to answer questions on the subject, apparently preferring to let the business papers do the talking.

It could come back, of course. But with Labour MPs and activists alike despairing of the party’s fortunes, how soon are they going to revisit such a toxic issue, one that could lose them votes as well as union backing? (N.B. The Communication Workers Union is not likely to vote for disaffiliation at their conference next week however, as the executive is against it.)

What this means for Lord Mandelson, who on Sunday said he was “not for turning” on part-privatisation, remains to be seen. Lindsay Hoyle, one of the MPs leading the fight against mail sale, wryly says: “He’s a very capable minister. Why leave them in one position when you can move them to one that needs fixing?” Reshuffle should be interesting.

Update: I should make clear, the situation according to MPs is that the bill doesn’t appear to be being debated at any point in the next three to four weeks. That takes us to within three weeks of the long summer recess…

Which Vauxhall plant will close?

Tony Woodley’s at it again.

Three months ago, he predicted that a UK motor factory was on the brink of collapse. The Sunday Times claimed it was Vauxhall’s Ellesmere Port, just days after I said the plant wouldn’t close. In the end, it turned out to be LDV that was in trouble.

Now, the Financial Times is reporting that Unite union officials are saying that Woodley – who himself used to work at Ellesmere Port – fears one of Vauxhall’s two plants in the UK will have to close as a result of the likely takeover of General Motors Europe.

Lord Mandelson is predictably unhappy. Well, there’s no love lost between him and Woodley – who once called for Mandelson’s fellow Blairite and predecessor John Hutton to be sacked.

Anyway, which plant has Unite sounded the death knell for? Despite Woodley’s links to Ellesmere Port, my money’s on Luton. Ellesmere Port has only just been kitted out to build the new Astra from September. Luton, on the other hand, produces the Vivaro, a large van… which is what LDV made.

The NEC may be the key

Ellie Reeves (right), with sister Rachel and friend

I was surprised today to take a phone call from Radio 4’s The World at One asking for Ellie Reeves’ phone number. It’s not every day that the media try to hunt down members of Labour’s national executive committee. But they did rather find themselves at the centre of a political storm this week, as the Labour Party’s sovereign body, when Gordon Brown stuck a proposal for dealing with MPs with dodgy expenses in front of them and got them to approve it.

Keen readers of this blog (both of you, in fact) will know the last time NEC members were being rung up by journalists far more important than me. Yes, it was when there was talk about calling for Brown to be re-nominated as party leader every year. That wasn’t a welcome story for No 10. And this one is far, far less welcome. The NEC only becomes important, it seems, when things aren’t going well for Labour.

What’s fascinating about the current crisis of confidence in MPs in general, and Brown in particular (witness his poor poll showing) is it gives the NEC two important roles to play.

One is the official role as the party’s decision-making body. The fate of errant MPs like Elliot Morley and David Chaytor now lies in the hands of just three NEC members – chair Cath Speight, Ann Black and Ann Lucas (standing in for Jeremy Beecham). They will turn their thumbs up or down at these wounded gladiators.

The other role is as a conduit for grassroots Labour views. That’s what’s happened this week, when Ellie Reeves took the views of hundreds of activists (who really are quite angry/unhappy) into that room at Portcullis House and tried to get the proposals changed. And when it failed, she came out and told them all about it. Which is where the BBC came in.

This is serious stuff. When Tony Blair was leader and Mark Seddon sat on the NEC, he described it as being turned into Blair’s Praetorian Guard: an ultra-loyal corps of unquestioning defenders. It’d be hard to call them that now. Brown is vulnerable. Organisations which have both grassroots support and the leaders’ ear are uniquely positioned to seize the initiative. If the NEC is successful in detoxifying the expenses issue, Brown will be safe – and they will fade back into the shadows. If not, he may find himself handbagged by those unpaid, expenses-free activists.

NEWSFLASH: Speaker will resign at 2.30pm today

No-one else seems to have the time just yet, so thought I’d put it up. Please credit me if you use it, thanks.

Expenses: In the name of Gord, go

Today Labour’s National Executive Committee meets to discuss dealing with expenses-happy MPs; I hear that Gordon Brown is going to be there (and not from one of the NEC, in case you’re wondering). Meanwhile the 33 NEC members have been deluged with thousands of emails from party members offering demands, suggestions and protestations about the conduct of their elected representatives.

The Prime Minister’s presence makes it likely that he will want the party, and the public, to see him as coming away from this meeting with a firm decision – his decision – on what to do. Expect the NEC to be given a plan of action and told to vote for it. No doubt it’s hoped that this will redress the balance between him and David Cameron, whose early apology and pledge to make MPs repay money has favoured him in the polls.

What are they going to decide? Two ‘extreme options’ can probably be ruled out. The first is to reselect all MPs, regardless of whether they’re under suspicion or not. The second is only to reselect an MP if the parliamentary standards commissioner decides they’re guilty of deliberately making an unjustified claim. The trouble is, how can you prove that? Will many MPs be caught out that way? I doubt it. In which case it’ll be seen as a get out of jail card for MPs, and Brown won’t get his positive headlines.

The NEC is moving towards approving guidelines for individual constituency parties to rule on whether they should try to reselect their MP (as reported in today’s Guardian). Of course, Labour’s high command isn’t going to leave it all to the constituencies to decide. But party activists and the NEC both want the power to be devolved to the grassroots.

Meanwhile, Brown faces the thorny problem of how to crack down on all MPs equally when that risks impacting on your own cabinet. How to deal with Hazel Blears’ dodgy second home claims and Jack Straw’s council tax bonanza? Perhaps the above solution is the neatest one. Is a constituency party likely to tell a cabinet minister they’ll be out of a job come June 2010, mindful of the violence that will wreak on the Westmnister scene and the humiliation it will cause for Labour? I doubt it. In which case maybe there will end up being one rule for ministers and another for backbenchers after all…

But I don’t know. We’ll see. Labour hasn’t planned a press conference for today. But keep your eyes glued to the TV.

Will Brown move on tax havens?

An edited version of this post appears on Liberal Conspiracy.

“We agree… to take action against non-cooperative jurisdictions, including tax havens. We stand ready to deploy sanctions to protect our public finances and financial systems. The era of banking secrecy is over. We note that the OECD has today published a list of countries assessed by the Global Forum against the international standard for exchange of tax information.”

Those were the stirring words of the G20’s London Summit communiqué last month. In advance of the summit, Gordon Brown was keen to put himself at the vanguard of the heroic frontal assault on those sun-kissed foreign resorts. “Old tax havens and the regulatory havens have no place in this new world,” he declared. So is his government going to start cracking down on tax havens?

I’ll come to the G20’s solution, that “international standard”, in a minute. First, picture the scene. Brown, Sarkozy, Merkel and Obama in shining armour at the head of a massed global army beetling over the shores of Grand Cayman/Bermuda/Zurich high street. The siege ladders are ready and the trebuchet is limbering up. Because that is the spectacle the G20 invite us to behold.

One problem for Gordon Brown in declaring war on tax havens is that he’s in charge of lots of them. No less than seven British overseas territories – Anguilla, Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Montserrat and the Turks and Caicos Islands – are on the G20’s grey list of countries that still aren’t complying with the information sharing standard, as Tory MP Sir John Stanley told the Commons recently.

This isn’t a rhetorical point. The Westminster government has complete discretion to intervene in the administration of these territories whenever it wants. In theory, Gordon Brown could tear up the Cayman constitution tomorrow and impose on it a UK-style tax regime.

He won’t, though. Last December Alistair Darling announced a review of Britain’s offshore financial centres to examine the “opportunities and challenges” facing them. The review under former Bank of England director Michael Foot is examining, amongst other things, the territories’ tax regimes, with one eye on what the G20 agreed, according to their interim report. But ministers have already declared that Foot’s review will not lead to any change in the territories’ governance or their tax affairs.

According to Brown (who, to give him credit, has written to the overseas territories about it) and the G20, the way to fix tax havens is to get them to sign up to information-sharing agreements.  If a country’s tax authorities wish to check that companies aren’t evading tax or exploiting legal loopholes, they can write to the authorities asking for information (number of Swiss bank account, amounts of money paid out etc.) The handbook for all this – that “tax standard” mentioned above – comes from the Organisation for Economic Co-operation and Development.

But the OECD only wants information to be available on request, rather than, as tax campaigners and many MPs want, automatically surrendered to the parent countries of the citizens and companies who bank there. To request it, you need their name, knowledge of the taxes in question and preferably knowledge of who holds the information. Tricky, when banking arrangements are shrouded in secrecy.

Finally, whatever money the Treasury can claw back from tax havens, what about those countries who need it even more than we do? The Commons saw a vigorous debate about tax avoidance last week, as Tory, Lib Dem and Labour MPs queued up to attack the government’s approach. Among them was Vince Cable, who highlighted a Christian Aid report suggesting that developing countries lose $157 billion to tax avoidance every year. Treasury minister Ian Pearson promised that the Department for International Development – which of course pays out aid to the same countries – is conducting a review on that very subject, to report “imminently”.

What happened to the G20’s siege ladders and trebuchet? Tax campaigners may well argue that they were waved around for the media before being packed away. The DFID report may yet change their minds – whether it influences No 10 and No 11 is another matter.

Darling’s Budget cuts: a question of where, not if

An edited version of this post appears on Liberal Conspiracy.

It’s a targeted programme of efficiency savings that will free up cash for investment in frontline services. Or it’s a devastating round of cuts that will damage public services and prolong the recession.

Take your pick, but don’t be surprised. The seeds of the £15 billion savings in public sector bills announced in Alistair Darling’s 2009 Budget were sown in last year’s Budget, which launched the Operational Efficiency Programme. The OEP’s authors spent a year walking – literally, I’m told – round government departments looking for cost savings, before writing their report.

They must have shown Darling an advance copy, because on Budget Day – one day after the OEP report came out – Darling announced he agreed with everything it said.

With immediate effect, the state must now change the way it works. Back office functions will be benchmarked. Procurement will be collaborative. Commercial potential will be harnessed. All adding up, we are told, to £15 billion. What will it mean?

One civil service manager had little doubt recently. Noting that there were two people in his office whose sole function seemed to be refilling the laser printer, he suggested that in the circumstances, maybe they should go. Printer replenishment operatives aside, the OEP is the talk of Whitehall, even if it isn’t making civil servants quake in their boots just yet.

But it’s hard to see how a big chunk of the savings won’t come from a reduction in the head count. One saving the OEP report talks up is ‘shared services’, such as government departments using the same back office software. But assuming Alistair Darling isn’t going to be up all night BitTorrenting pirate copies of Sage, that will mean buying new software, or at least new licences. Some harmonisation has already been done: the Cabinet Office and Department for Work and Pensions, for instance, use the same payroll system. And of course, merging back offices means fewer staff: the OEP report approvingly cites the case study of a private firm that lost 70 per cent of its finance and HR staff.

So there must be job losses. There must also be privatisation – the Royal Mint, Land Registry and the Defence Storage and Distribution Agency (you learn something new every day) will be fully or partly sold off. Some of the jobless will go onto Jobseekers’ Allowance. At current rates, before any such redundancies, enough extra people will join JSA rolls in the next three months to staff every department, quango and executive agency in Whitehall.

Anyone who disagrees violently with the above will not perhaps be overwhelmed by the opposition. The only united campaign comes from the Trade Union Co-ordinating Group, a team of left-wing unions set up last year to provide an alternative forum for political action to the TUC and the Labour-affiliated unions. It includes the Public and Commercial Services Union, representing some 300,000 workers mostly in central government.

Contrary to a report in last week’s Guardian, the TUCG is not meeting MPs this week to discuss how to fight the Budget. It’s having a routine business meeting, which will cover the same issue, amongst others.

Even if the unions were lobbying MPs, they’d be up against massive odds. Because when Darling rubber-stamped the OEP report, he also endorsed the complex machinery of cost-cutting it will set up. The Treasury will establish a “value for money review group”; each department will have a minister responsible for “championing value for money”; there will be operational reviews, systems reviews and six-monthly asset management and sales reviews.

In short, unless the Finance Bill that passes the Budget into law is stopped in its tracks in Parliament – which it won’t – the wheels of efficiency savings will be grinding away before anything can be done about it. It looks like the argument will now shift to what gets the chop, and when.