Tuesday, March 16, 2010

The Tories Must Abolish the Union Modernisation Fund

Since the Union Modernisation Fund was established, UNITE has received nearly £4.5 million according to figures published in this morning's Guardian. This is £4.5 million of taxpayers' money, going straight into Union coffers. And then out again direct into Labour Party coffers.

In any other sector this would be known as laundering. Oh no, UNITE, will no doubt bleat. There is no link between the two things. Of course not. Never let it be said. What do they think we are? Idiots?

This is why trade unions give money to Labour. They expect something in return, and the Union Modernisation Fund is one of those things.

If trade unions wish to "modernise", why is it that they don't just do it, and pay for it themselves without fleecing the taxpaper?

Everyone in politics knows the UMF is a vile little quid pro quo - you scratch my back, I'll scratch yours - between Labour and the Unions. I have no doubt that if the UMF had not existed, UNITE's donations to Labour would have been £4.5 million lighter.

This scandalous fund should be abolished within months of the Conservatives coming to office.

I understand that DfID also gives shedloads of money to the Unions. I wonder if other departments do too. All information gratefully received.

PS I have blogged on this before, HERE.


Frugal Dougal said...

It's certainly not a million miles away from money launering, is it?

Tom said...

My maths may be a bit off, but if UNITE has donated 11 mil, but only got back 4 mil, thats not a particularly good return is it?

macuser_e7 said...

"This is why Michael Ashcroft gives money to the Tories. He expects something in return, and his peerage is one of those things."

"This is why Rupert Murdoch gives his papers' support to the Tories. He expects something in return, and control of their media policy is one of those things."

See, we can all play that game.

Frankly, banging on about dodgy sources of cash is a bit rich coming from the Conservative party right now. At least Unite's members all pay their taxes in the UK. As Simon Heffer said in the Telegraph, "If you wish to own a political party in Britain, you should at least have the good manners to pay all your taxes in Britain."

Fenrir said...

They should ban this Labour subsidy fund immediately.

Stepney said...

An absolute outrage.

Imagine if it was Rio-Tinto-Zinc instead of UNITE?

The Govt gives taxpayer's money to a private company, who in turn gives money to the Governing party, AND sponsors 56 candidates AND provides an Executive Director from the RTZ board for the campaign complete with total access to the House of Commons and Downing Street.

What would the White City Ministry of Truth say then I wonder?

warelane said...

I am a Labour PPC. I belong to Unite the Union. I have received not a penny from them.

mrsteed said...

This is one of the most blatant abuses of government cash.

Unions always deny it, claiming that their funding of Labour comes from the "political levy" but the fact remains that, if they used their money for the benefit of their members, this situation wouldn't arise.

The UMF should be abolished and the political levy altered so that, rather than having to opt-out on joining, people should have to opt-in. My cousin recently joined Unison. She had no idea that her subs were going to fund Labour but she was press-ganged into joining by her colleagues.

Angry Walrus said...


I had a look at a broader cross-section of unions and saw that nearly all the unions who gave money to Labour recieved some considerable sums from this "Fund".

Labour are using a range of Unions (not just Unite) to launder Taxpayer's money and then channel it straight back to themselves.


Angry Walrus

Jason Myers said...

Nice to have Labour on the back foot again - where they belong! In my perfect world - Tories win minority government. Another election by 2011. Labour go bankrupt. Tories win big. Lib Dems official opposition. Arrogant Labour ruined. Brown - the worst PM in history ever.

Simon said...


read the Fake Aid report on DfiD here:


Lowlights include:

The Trades Union Congress (TUC) has received DfID grants worth over £1.2 million since 2003. Funding covered lobbying activities, new staff for their European Union and International Relations Department, and an “international buffet and wine” event with live music to celebrate “International Women’s Day” in the UK. DfID also paid the TUC to hold lessons in how to apply for even more DfID funds.

Under one programme, DfID granted the maximum amount, £300,000, to the National Union of Teachers (NUT) to “enable them [teachers] to become global agents of change” through greater involvement with development issues. The project intends that teachers can then become involved in “central and local government department policy debates.”

To make matters worse this is from the International Policy Network

In a report in 2009, International Policy Network disclosed that between 2003 and 2006 the Trades Union Congress received over £1.2 million in taxpayers' money ostensibly intended for promoting development in poor countries. A significant amount of this money - which came from the UK Department for International Development (an entity created by the Labour Party in 1997) - was spent in the UK on activities that do not seem to have yielded any practical benefit to the poor either inside or outside of Britain.

Subsequently, IPN discovered that the TUC was recently granted a further £2.4 million by DfID for the period 2009 - 2011. The new support to the TUC comes from funds intended for large international development NGOs with a track record in poor countries. It’s unclear why this trend has been broken to fund a British trades union.


I don't think we know the half of it yet.

Jimmy said...

Back to the smears again I see.

"This is £4.5 million of taxpayers' money, going straight into Union coffers. And then out again direct into Labour Party coffers."

You keep repeating this as if it were true no matter how patiently it's explained to you. What you allege would of course be wholly illegal. May we assume that you have passed your evidence to the police?

Westminster watch said...

It is appalling.

Sounds to me that someone should be sending FOI requests to all leading government departments and agencies asking for details of any payments made to the 3 or 4 largest unions. I would happily do it, but as a Brit living outside the UK I won't be given the responses.

Daily Referendum said...

Unite donates to Labour against the wishes of its members.

Dave H said...

Don't forget all the 'charities' the taxpayer funds to lobby on the Government's behalf.

I'd like to hear an end to news reports that run along the lines of:

"A study, commissioned by the charity Completelyimpartial, has reached the conclusion that Labour governments are best.

The report, entitled 'Why Britain is better off under Labour', outlines how Gordon Brown is by far the best PM in British history and makes the recommendation that the entire nation votes Labour.

The government has welcomed the report and says it is a subject worthy of additional research."

Evensong said...

I actually agree with a large part of the objective of the fund -that being to support ideas and projects that encourage innovation in working practices.

What I don't agree with is how access to the fund is by nature restricted to one type of body. How much of the funding is allocated to projects that, for example, are also being worked on by other bodies, including universities, Government departments and private companies? There could be a large amount of wheel reinvention going on here.

Surely the answer is to have a single fund which is then open to all. Yes, there would be a potential financial saving to be made, but that would be quite negligable in the grander scheme of things; it would encourage a range of public sector bodies and private sector organisations to work together as well as improve the quality of the results of the investment being made of what is, at the end of the day, the citizen's money.

ferial ferret said...

Union Modernisation Fund??

UNITE seem to be regressing to the 1970ies are they taking this money under false pretences?

Time for Charlie to return to his fly fishing in Bonnie Scotland

George said...

So, NuLab is corrupt.
They've been laundering money via the Union Modernisation Fund, sort of charitable bungs for donations scandal.
Nothing new there Iain.
ALL political parties since time immemorial have been doing something similar.

Johnny Norfolk said...

Have you noticed you never have the BBC doing investigations into things like this. Its all part of their family.

Hawkeye said...

The Union Modernisation Fund?

Might as well scrap it because it clearly does not work. The unions are run by bl**dy 1970s marxist dinosaurs.

Not much sign of modernisation there...

Evensong said...

@macuser - you're quite right that anyone making donations to a political party should pay UK taxes.

A pity you conveniently don't mention Lord Paul, Lakshmir Mittal, Sir Gulam Noon, Dr Potter and the rest of Labour's non-dom supporters. Good job Iain did at the beginning of the month so you can update yourself here

Point here though is that until all parties are restricted to accepting no more than a nominal limit of (for example) £10k from any individual or company during a financial year, they will continue to be viewed with suspicion. Politics should be about serving the needs of the many, not the vested interests of the few.

simon said...

This is the reality of political funding. Groups and individuals who give money to parties expect something in return, often in the form of cash (tax cuts, privatisations that open up contracts for private companies etc). You could also campaign for a rule that no company that donates money to a political party can accept a government contract, and no individual donor can accept a knighthood.

Twig said...

"If you wish to own a political party in Britain, you should at least have the good manners to pay all your taxes in Britain."

Wouldn't it be fairer if he paid tax in Belize on money earned from Belize and tax in the UK on money he earned from the UK?

alan said...

As so often, the Daily Mash has run with this:

"BRITAIN'S biggest trade union today ordered Gordon Brown to describe it as 'deplorable'.

Mr Woodley is paying £11m for the Labour Party over three years As Unite stepped up its plans for a British Airways strike that will ground dozens of flights and potentially cripple the company, the union told the prime minister to be absolutely appalled by its actions.

Downing Street sources confirmed Mr Brown had telephoned Unite general secretary Tony Woodley on Sunday to ask for instructions and money and that Mr Woodley had set out his plans for the prime minister to look very angry and use the word 'unjustified'.

A senior source said: "Mr Woodley ordered the prime minister to come across as being really genuine and say that a strike was not in the national interest and call on both sides to return to the negotiating table.

"When he had been given permission to speak, the prime minster said that if they worked it just right they could make it look as if he had stood up to the unions, averted the strike and saved everyone's Easter holidays.

"Mr Woodley then said that if Mr Brown wanted to pretend that it was his idea then fair enough, but that they both know who the bitch is in this relationship."

Industrial relations consultant Nathan Muir said: "The union sees it as a win-win. If the strike goes ahead then Unite gets to fulfill its lifelong ambition of destroying Margaret Thatcher's favourite airline.

"If the strike is called off then Brown gets the credit, it improves Labour's election chances and they all continue with their plan to turn Britain into a slightly bleaker and less charming version of North Korea."

Meanwhile Mr Brown has insisted that if Labour loses the general election he intends to build a replica of Number 10 in the back garden of his constituency home and indulge in a series of poisonous, damaging feuds with a selection of local cats."

They really do have their finger on the pulse!

Moriarty said...


Smears? Only in this sense: anybody with a platform should take the truth and smear it all over the Whelan attack machine.

Congratulations on managing more than one sentence though.

The King of Wrong said...

The alleged bribery scandals involving BAES were much smaller - $1bn on a $100bn deal (al Yamamah).

A ~40% kickback is enormous...

trevorsden said...

There is another seedy side to Labour - their dodgy non dom donor, Lord Paul.

Guess who's been keeping him happy at lunchtime ...


Grandpa said...

Well done Iain, "follow the money"

David Lindsay said...

Fully 14 Labour candidates have come from trade union employment. Three and a half times that number, 63, are the bankers who are Tory candidates. Who has done more damage more recently?

And if public money really is being passed through the Union Modernisation Fund to the Labour Party (I am not convinced - this whole story has the feel of having been concocted by people perfectly, tribally ignorant of union and Labour financial arrangements), then that pales into the merest of insignificance compared to the funding of the Conservative Party by the bailed-out, taxpayer-dependent City.

DespairingLiberal said...

Iain, now that Blaney's Blarney has submerged following attempts by the Guardian to expose the sheer nastiness of his public utterances and the YBF "Tory Madrasa", shouldn't you remove it from your front page list of bloglinks? After all, it is no longer a public blog.

I wonder what he is saying these days, now that it's all secret - could you let us into a little bit of it? That's assuming he lets you in!

Simon Gardner said...

"...within months of the Conservatives coming to office."

It all looks like it may trickle away, doesn’t it? What a shame for all the bombastic head-bangers.

DespairingLiberal said...

Yes, King of Wrong - it's obviously wrong for a membership union to donate small beer money and it's obviously right for bent cousins of arab oil sheikhs to receive £1 billion in corrupt arms deal payments. Says a lot about Tory backwoodsmen that you think that makes some kind of sense.

Jimmy does have a point actually because if any of this were illegal, I feel sure it would have been actioned long ago.

The Dfid payments are a complete disgrace, but confidence in that organisation has ebbed anyway since they privatised their main commonwealth development arm and let it's directors trouser huge bonuses.

Sadly, very many institutions in government in the developed nations are not doing what is written on the tin. Unions at least try to represent their members some of the time. The big political parties ought to try that, might make a nice change for them.

JMB said...

"This scandalous fund should be abolished within months of the Conservatives coming to office"

I would have thought within weeks of coming to office, if not days.

Bill Quango MP said...

You seem to have missed the point.
its not about sources of cash. Its about taxpayer's taxes being given to a union to modernise its practices.
That union then gives 'some' money to the Labour party from members contributions.
IF the generous taxpayers of great Britain had not unknowingly given their funds to Unite, then Unite would have had to modernise from its own funds, leaving it with less money to sponsor a political party.

The Ashcroft comparison doesn't work. Unless there is an Ashcroft modernisation fund whereby Lord Ashcroft receives £10 million from the taxpayer in order to modernise his wardrobe. He spends £3 million on new suits and £3 million on shoes and then donates £4 million of his 'own' money to the Tory party. This is his own money and nothing to do with the remaining £4 million from the AMF.

Very very touchy union folk are about this too.
My rep won't even mention it.

jon dee said...

Warelane @ 3.10 pm.

Suppose being a Unite member won't have anything to do with you being a Labour PPC ?

Even if somebody else is handling the cash, its hard not to see you as part of a bulk deal.

Intentionally Blank said...

Jimmy said "Back to the smears again I see."

Er, "Jimmy" What part of the transaction that Iain describes is a smear or in any way factually incorrect? The Government gives £4.4m to Unite to spend on itself and Unite gives Labour £11m collected from its members. Unite can't spend the £11m on itself but it can spend the £4.4m on salaries, gold plated pensions and feathering its own nest. To anyone outside of Labour and Unite, this is text book money laundering - the arrangement helps Unite acquire unencumbered cash to do with as it pleases. All courtesy of the UK taxpayer.

In addition, Labour is infested with Unite's foot soldiers and Unite is run by members of Labour's inner circle - Dromey and Whelan to name but two.

If you honestly believe that this is all above board and not part of a barely disguised mutual back scratching exercise, you are either a bit thick or as devious and slippery as your Labour troll-masters.

And the best defence you can muster to deflect from this obvious corruption "Yeah but you can't prove it can you."

How very socialist.

David Lindsay said...

Bill Quango, the Ashcroft Modernistation Fund does exist. It is called non-domiciled tax status. The only difference is that you vastly underestimate the sums involved.

trevorsden said...

"Unions at least try to represent their members some of the time" ... a ringing endorsement that will bring joy to TUC House.

mac..e7 ..."Frankly, banging on about dodgy sources of cash is a bit rich coming from the Conservative party right now"
err - its the labour party who started this; the tories are simply saying people in glass houses should not throw stones.

Don Corleone and Jimmy Hoffa would have been proud of the Union Modernisation Fund

Sean Haffey said...

>evensong @ 4.06pm

Your last paragraph is perfect.

Ronald said...

How much have the unions modernised since they started taking this money?

titus-aduxas said...

"DespairingLiberal said...
.....because if any of this were illegal, I feel sure it would have been actioned long ago."


Roger Thornhill said...

David Lindsay

" the funding of the Conservative Party by the bailed-out, taxpayer-dependent City."

Don't you mean Darling-Brown funded? Since when did the Conservatives bail out the banks.

The banks did not act because Northern Crock was kept alive (incorrectly) to keep the Northern Soviet ticking over and that gave out the wrong signals.

Bill Quango MP said...

I thought you might mention that David. But Lord Ashcroft pays the same amount of tax on his UK earnings as does anyone else working in the UK.
Lord Ashcroft does not pay UK taxes on his overseas earnings as they are nothing to do with the UK.
Nor does anyone else for that matter. That's why he isn't in jail.
Whether he should be allowed to sit in the Lords if he is not resident in the UK is another matter but he does not receive taxpayer's money at all. Unlike Lord Paull who received quite a lot for expenses such as .. erm .. well.. he got expenses and has decided out of the goodness of his heart to repay £38,000. Lord Ashcroft decided to repay £0 of his £0 expenses.

But we digress. the unions do recieve taxpayer's cash. A considerable sum. About the same sum as it would have taken to keep all the Post Offices threatened with closure in 2009 open. Unfortunately they are now all closed.
The CWU who went on strike against plans to modernise which is pretty ironic in this context donated £1 million to Labour last year.

The King of Wrong said...

@David Lindsay:
"Who has done more damage more recently?"

The union calling a strike this weekend? Gordon Brown's fiscal policies?

Or were you trying to imply that the oh-so-villified bankers were doing something other than what the Treasury and FSA allowed them to do?

The King of Wrong said...

@Despairing Liberal:
Can you show me where I said I was in favour of bribery?

You might also want to be careful with your allegations of it, given that the case was never proven.

But it's interesting, is it not, that while the private sector might allegedly pay 1% kickbacks, the public sector is so profligate with other people's money and so out of touch with commercial reality that a 40% kickback gets justified as being morally right and "small beer"?

The Purpleline said...

Labour drop Go Fourth from their official election campaign after I pointed out they will finish fourth behind Tory, Ukip, Libdem Bnp in some parts of country.

They wont be fourth they will be fifth in the local elections.

We need the Tory party to act strong now and say they will hold an inquiry into the Unions if elected.

David Lindsay said...

"Lord Ashcroft does not pay UK taxes on his overseas earnings as they are nothing to do with the UK. Nor does anyone else for that matter."

Not true.

At least one sixth of the population could be non-domiciled, and many of those have interests in the countries to which they have connections, but the only ones who can afford to be non-doms are the tiny number who don't need their incomes to live on.

Oh, and who are prepared to declare another state to be their natural home in order to avoid paying for the services on which every business in this country depends one way or another.

strapworld said...

macuser_e7..another from the number 10 kindergarten!!

Perhaps you could ask Mr Whelan just how many MP's Mr Murdoch is sponsoring? How many employees of News International will become MP's?

Similarily the same questions apply for Lord Ashcroft.

Grow up!

Alastair said...

The Union Learning Fund is absolutely NOT a slush fund - it supports things like literacy and numeracy training, is not limited to people in unions and is one of the more effective educational interventions.

Mrs Rigby said...

By coincidence I've rambled on about the unions' Political Levy - and how it helps only one party instead of being spread evenly throughout the political spectrum - except I didn't write it very concisely.

tory boys never grow up said...

"This is £4.5 million of taxpayers' money, going straight into Union coffers. And then out again direct into Labour Party coffers."

You conveniently forget the law created by the Conservatives - which only allows contributions paid into Trade Unions political funds, and from which individual trade unionists can opt out, to be used for contributions/affiliations to political parties. All of which is subject to independent audit and review by the Certification Officer. It just isn't legal to recycle Union Modernisation funds directly back to the Labour Party (as you say) or for other political activities which have to be paid for out of political funds.

As you should know Mr Dale falsely accusing a body of breaking the law is libellous - although I supect that UNITE probably do not think you are worth the trouble.

Another day another Tory smear I'm afraid.

Bill Quango MP said...

Mr Lindsay.
You seem to be suggesting that families from Pakistan or India or Sudan, who still retain interests in that country through a family owned business, should also pay tax on that income in this country as well as any in the home country?

Why? The money is theirs.Not the governments.
If that money is brought into the UK to finance, say, an election poster costing some £20,000 then VAT of 17.5% {£3,500} is payable to the chancellor. That money belongs to the government. As does taxable interest earned by deposits in UK bank accounts. Stamp duty. Road fund licence. Council tax and so on.

I know that is a hard concept for a socialist to grasp but the money an individual earns outside of the United kingdom is not subject to United kingdom taxes. However much the chancellor wishes it was.

Its why the 50% tax rate will make some, those who can, move away.
Or move money away at least.

But at least those rich fat cat head teachers and council executives, senior military commanders, league two footballers and above will be paying up for their selfish stinking richness.

Jimmy said...

"The Union Learning Fund is absolutely NOT a slush fund - it supports things like literacy and numeracy training, is not limited to people in unions and is one of the more effective educational interventions."

I suppose judging by this thread that there is an argument to be made that the right needs access to such a programme more than the left.

Craig Ranapia said...

"The Union Learning Fund is absolutely NOT a slush fund - it supports things like literacy and numeracy training, is not limited to people in unions and is one of the more effective educational interventions."

Well, nice to know that the UK's education system is so crappy that the government is now outsourcing adult education to UNITE.

Labour isn't working. It isn't educating either.

Moriarty said...

"The Union Learning Fund is absolutely NOT a slush fund - it supports things like literacy and numeracy training, is not limited to people in unions and is one of the more effective educational interventions"

Indeed. Much like Ruskin College. An educational facility that took under its wing a raw John Prescott and polished him into the diamond he is today.

It's no surprise to learn that Charlie Whelan, the "brains" behind Brown's first budgets, is in need of literacy training. When does the course start?

Patrick said...

UMF - Looks like a lot money is spent on IT projects!!!!!

Looks like most unions have taken up the money to invest in their web presence. For example:

TUC Website
Equity Website
RMT Website
ASLEF - communication/website
BECTU - A website
FDA - Website
National Union of Schoolmasters - Website
NUJ - New IT system
LTU - New Website
Bakers Food and Allied
Workers’ Union - A diversity/IT system
NUT - "Web based resource centre"

macuser_e7 said...

Strapworld says: "macuser_e7..another from the number 10 kindergarten!!"

Er, not at all actually.

Apart from Ken Livingstone for Mayor of London, I haven't voted for any Labour candidate at any election, local or national, since 2001.

And despite the best efforts of Mssrs Cameron and Osborne over recent weeks I won't be voting Labour this time either.

My objection here is to the hypocrisy of saying large donations to one party are evil and corrupting but large donations to another aren't. I agree with Evensong's point about limiting the size of any one person or organisation's donations to a reasonable size to reduce the appearance (and practice) of influence-buying.