Unite union boss Len McCluskey threatens to launch party to rival Labour

Labour’s biggest financial backer has threatened to sever its link with the party altogether if Ed Miliband loses next year’s general election – raising the prospect of it having to compete for votes with a rival Workers’ Party lavishly backed by union money.

Len McCluskey, General Secretary of Unite, forecast that the 2015 election will bring defeat for Labour if the party campaigns on what he called “a pale shade of austerity”, rather than the more robust left-wing political programme that he and his union allies want.

The union leader signalled that a rival party could be created to challenge Labour if it does not win next year.

If carried out, the threat would plunge the left in Britain into its biggest crisis for 33 years – resulting in the most significant split since a group of Labour MPs broke away to form the Social Democratic Party in 1981, dividing the anti-Tory vote in half.

Mr McCluskey revealed that he and Mr Miliband rarely speak to one another, though they are due to meet this week.

Speaking about the consequences of a defeat next year, he said: “I fear for the future of the Labour Party.”

Mr McCluskey implied that a newly formed Workers’ Party would then join the Liberal Democrats and others in campaigning for MPs to be elected under a system of proportional representation (PR), to give the new party a better chance of gaining a toehold in Parliament.

“I’ve always taken the traditional position of being opposed to PR,” Mr McCluskey said. “That’s because I thought that Labour would never get into power [under PR] and we’d never get a socialist Valhalla.

“I’ve given up on my socialist Valhalla, so I’m now rethinking my position on PR. If a new party emerged, a new Workers’ Party, then you may well find that I’m in favour of PR.”

Mr McCluskey’s comments to a press gallery lunch in the House of Commons were a calculated push for the Labour leader to draw up a more radical election manifesto than currently planned.

“My challenge to the Labour leadership is ‘Demonstrate you’re on our side, let’s win the next election, let’s give hope to ordinary people’. If that happens: fantastic,” he said.

Among the ideas he said would command popular support are nationalisation of the train operating companies and a sharp increase in the national minimum wage. It is understood that the provisional plan in the event of an election defeat would involve Unite, the country’s biggest union, and the GMB, the third-biggest union, cutting their ties with Labour simultaneously. They would join forces with the RMT rail union – which disaffiliated under the leadership of the late Bob Crow. The combined membership of the three unions is almost 2.1 million.

“Within Unite’s rules we are affiliated to the Labour Party and cannot give financial support to any other party, so the rules would have to be changed,” he said.

“Can I ever envisage a rules conference voting to disaffiliate from Labour? I can, and that’s a challenge to Ed Miliband. Because I believe the Labour Party is at a cross roads. Labour has to demonstrate that it is our voice.

“We are at a stage in politics where just bumbling along in the old ways is not going to happen any more. Unless Ed and the leadership demonstrate that they are on our side, then I can envisage a debate taking place if Labour lost the election next May.

“I fear for the future of the Labour Party.”

Ever since Ed Miliband introduced radical changes to Labour’s relationship with the trade unions, there have been rumours that senior figures within Unite were considering whether to break away to create a new party.

Unite’s huge influence within the Labour was pivotal in securing Ed Miliband’s victory in 2010. But relations with the Labour leader soured during the infighting in Falkirk – where Unite was involved in recruiting new party members in the hope of securing the seat for Karie Murphy.

Mr McCluskey told the journalists that his relationship with the Labour leader is “OK”. He added: “How often do I see Ed? I can’t remember the last time I’ve seen him: not that often. But I am due to see him on Thursday.”