Unions must realise this is the only Labour government they have

Labour's public credibility depends on its ability to defeat the first public sector strike that comes along

THE LAST time Labour came into office after a long period out of it, a jolly joke circulated among union leaders. It was about the trade union delegation to the TUC Congress which held a lavish reception at which the guest of honour was Harold Wilson.

So lavish, in fact that when the delegates got back to London, the union's Treasurer questioned the cost. Ah well, the General Secretary explained, Harold was detained until late at Downing Street on vital government business and we had to keep drinking until he arrived.

But then the following year the costs of the union's annual reception proved to be wildly over budget once more. With just a hint of sarcasm, the Treasurer asked whether Harold Wilson had been late again "No", the general secretary replied wearily, "George Brown was early".

The story conjures precisely the cosy - if frequently also acrimonious - family atmosphere that joined what used to be called the political and industrial wings of the Labour movement when the party was last in power. To most of those now inhabiting Downing Street, however, including Tony Blair, the joke will be just a ghostly and baffling throwback to a past that no longer has any meaning. All that has gone.

The present Prime Minister certainly does not see the TUC - at whose general council dinner he will be a somewhat reluctant guest of honour this evening - as an inseparable sibling of the party he leads.

The links between a Labour government and the TUC are not, to put it mildly, what they were.

True, old habits die harder than you might have thought. John Prescott, the (very soft-drinking) equivalent in power of George Brown, was there yesterday; Peter Mandelson who, as he reminded my colleague Andrew Grice at the weekend, actually worked at the TUC 20 years ago, is cutting short his trip to South Africa to speak to the Congress on Thursday.

David Blunkett and Mo Mowlam are going; Gordon Brown would certainly be braving criticisms of the high level of sterling and interest rates, were he not in Japan. Instead this task will be left to Eddie George, no less, the Governor of the Bank of England.

The number of ministers elbowing each other out of the way in the rush to Blackpool is one of the reasons why this year's Congress is proving more interesting than many in the recent past; the other is that at least some of the fears being expressed by manufacturing unions about the economy will be echoed elsewhere, including among industrialists.

This is flattering. But union leaders should not be lulled by this welcome attention into forgetting that the world has changed beyond recognition since the last time they met a year into a Labour government.

To judge by the blood-curdling threats of industrial action in the public sector by John Edmonds, or by Roger Lyons' tendency to blame British interest rates for every factory closure in the North East, this is a lesson they still find difficult to learn.

The sense of grievance among public sector workers, whose pay is increasing at only half the rate of those in the private sector workers, is real; especially in the case of nurses and teachers, whose commitment and quality is critical to the two services which Labour won the election promising to improve. But the unions face a severe problem in contemplating strikes, as Mr Edmonds must know: Tony Blair and Gordon Brown's economic credibility would depend on their ability to defeat the first public sector strike that comes their way; and the rank and file membership may be quite intelligent enough to realise it.

Similarly it positively undermines the case for the Bank of England's remit to be widened to take more account of the problems of manufacturing industry if Lyons pretends that a collapse in the world micro-chip market, caused by the Asian economic crisis, was not to blame for the Fujitsu or Siemens closures.

The only organisation ignoring those factors is the British Conservative Party, and they at least have the excuse that their job is opposition, on whatever grounds.

What has made the TUC an important forum this year - apart from the understandable desire of ministers to rub shoulders briefly with leaders of Labour-affiliated unions who still matter at the party conference, not to mention, perhaps, leadership contests in the distant future - is largely the work of one man. John Monks.

Mr Monks is an articulate, thoughtful and thoroughly modern leader of what he himself never ceases to remind interviewers is the country's largest voluntary organisation. It may be unfashionable to say so, but the TUC congress, in its less publicised debates, discusses, often before anyone else does, a whole series of bread and butter issues from safety at work to productivity, which are of genuinely national importance.

Mr Monks has stressed continually the value of industrial partnership. He understands that the unions have problems of their own which they cannot expect government of any colour to sort out for them.

With membership of TUC-affiliated unions down to 6.6m compared with 13m in 1980, the unions have a duty to organise as well as moan, to paraphrase the old American Industrial Workers of the World slogan.

That is why the TUC has started to hire and train expert young union recruiters for the private sector. Mr Monks has shown some signs of irritation with colleagues apparently anxious to talk industry into a worse recession than it may already face. He understands that political lobbying may be a more potent weapon than threats of industrial action. And his proven negotiating skills are one of the reasons why the TUC made some real gains in employee rights in the Fairness at Work White Paper.

True to form some of his colleagues then immediately denounced the outcome to the detriment of their own reputations among their members.

Employers, including newspaper industry employers like Rupert Murdoch's News International, have now embarked on a ferocious lobbying campaign to water down some of these provisions. There is certainly a case for unions, at a time when they are proclaiming their justified worries about jobs, not demanding so much labour market regulation that it, too, threatens employment.

Nevertheless Mr Mandelson would be unwise to bow too far to the employers by unravelling the carefully constructed settlement which produced his predecessor's White Paper. The settlement took a great deal of negotiation - and Mr Monks is well aware that he will have a ready audience in the Parliamentary Labour Party if he is in a position to cry foul on an agreement which the unions thought was a done deal. Nor should the TUC be ignored: if John Monks' strong support for EMU holds, despite TGWU opposition this week - and his case is stronger in view of the higher rate of sterling - it will become a highly important instrument for delivering a yes vote in a referendum.

In return however union leaders should listen to Mr Monks a little more and use the oldspeak of 20 years ago a little less. As Mr Prescott reminded them yesterday, they are listened to a lot more by this administration than the last. The minimum wage, better rights at work, and at least the right to recognition if a ballot votes for it, is more than any Tory administration was prepared to grant.

In the end, this is the only Labour government they have got.