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GMB cuts its Labour affiliaton fees by 87% - and the balance of power shifts even further to Unite

By Mark Wallace
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Labour Rose WiltingIt has now been two months since Ed Miliband made his big speech intended to nip in the bud the crisis over Labour's trade union funding.

We still don't have any answers to the many questions about how his reforms will work in detail - most notably whether he will reject money from unions who refuse to implement an opt-in and how Labour's constitution will be rewritten. 

But we can already see some of the fallout of his inept response to teh scandal.

In high dudgeon, the GMB have cut the affiliation fee paid to Labour from £1.2m to £150,000. Whereas the union previously automatically affiliated 420,000 people to Labour, it now estimates that those who would actually choose to affiliate only number 50,000.

As well as being a severe financial blow to a party beset with debts and money worries, this has three further implications.

The first is that while Miliband claims that the trade union movement is a mass "Labour movement", actual union members mostly do not view themselves as Labour's people. Making their union supporters into full party members may temporarily stem the decline in Labour membership, but the bump will be smaller than claimed and it will not stop the long term decline.

The second is this reveals the true scale of the relationship breakdown between Labour and the unions' political elites. This is a pre-emptive step clearly intended to cause pain for Miliband, and Rachel Reeves' suggestion that far more GMB members would actually like to affiliate was rebutted sharply: "dream on". Ed's handling of the union scandals has alienated his main donors: a "senior GMB source" told the BBC that "we will not pay for our own demise".

The third is the change in the balance of power among the unions themselves. The GMB are apparently concerned that their members might vote down the Political Fund which powers their wider, left wing but not explicitly partisan, campaigning, so they have prioritised that over backing Labour. Meanwhile, Unite must realise that as their competitors wield less influence at Labour HQ, the power of their pounds becomes all the greater.