What next for UK Labour?

Friday is a big day for the UK’s ruling Labour party, whose leaders will gather at Warwick University for their ‘National Policy Forum’ -– a get-together designed to produce policies for the autumn conference and to set the tone for an eventual election manifesto. The meeting takes place a day after a Glasgow parliamentary by-election, in which Labour is struggling to defend a once-comfortable majority of 13,500 against the Scottish nationalists.

Prime Minister Gordon Brown will need to keep an eye out to his left. The Labour Representation Committee, a large grassroots organisation, will call for a change of tack on totemic issues (nuclear weapons, railway ownership and earnings-related pensions). It will be ignored, but Brown faces real difficulties with the unions. Sensing government weakness (and recognising that they will not get as good a deal under the Conservative party, which holds a persistent poll lead), they presented Brown last week with a package of 130 policy amendments, such as scrapping prescription charges, and revising public sector pay. They have memories of their influence over the 2005 policy forum (and the election manifesto which followed), and claim that their proposals are the only way for Brown to secure another term.

However, the unions risk overreaching, especially in calling for greater powers for themselves. Demands such as a restoring of secondary picketing conjure memories (which the press and opposition have been quick to exploit) of troubled 1970s-era labour relations.  With voters’ attention fixed on inflation (debates over the price of living have dominated the Glasgow East race), unions take a risk by campaigning on public sector pay. If the government succeeds in painting union demands as irresponsible, they may appear out of touch. If unions succeed in changing the government’s policy, they make it appear in hock to interest groups, and make themselves a target following the next election.

After all, the possibility exists that a Conservative government will enter office and reform party funding in such a way as to weaken the ties between unions and the government, at a cost to both (given falling business donations, unions now provide 90% of Labour party funding). Although projecting a moderate image, Conservative leader David Cameron retains his party’s dislike for organized labour and attacking unions is an easy way to reward his backers. A union victory this week, then, might be as harmful as a defeat.

Meanwhile, Brown clings on, protected by his rivals’ recognition that they could not do better in the present political and economic climate. He is probably safe for a year, by which time the economic situation will be clearer, and an election close enough that a fresh face (Foreign Secretary David Miliband and Work and Pensions Secretary James Purnell are among the freshest) might give the party a new lease of life. Uneasy lies the head of Gordon Brown.