No deal yet on minimum wage say the unions

Trades Union Congress: Disagreements with Labour Party persist despite desperate need for electoral victory

BARRIE CLEMENT

and COLIN BROWN

Tony Blair last night suffered a blow in his hopes of moving Labour on to a new agenda, and avoiding controversy with the trade unions over a national minimum wage.

The Labour leader was planning to tell the TUC, in a keynote speech to the conference tomorrow, that their decision to drop the issue of a fixed figure from the debate was evidence of a "more mature, more modern and healthy relationship" between Labour and the trade unions.

Mr Blair intended to use the speech to signal that he wanted to move away from internecine battles on to the offensive against the Tories with a clear policy agenda. "He will make the shift in emphasis from new Labour to new Britain," said a leadership source.

The sources privately praised John Monks, the general secretary of the TUC, and Bill Morris, general secretary of the Transport and General Workers' Union, for working behind the scenes to defuse the issue of a fixed figure for the national minimum wage.

But last night, engineering union leaders scuppered that strategy by insisting that skilled workers would seek to maintain their pay differentials, prompting fears that a statutory minimum could spark an inflationary spiral.

Under intense pressure from Mr Blair, the firefighters' and construction workers' unions agreed to drop propositions to be tabled at the TUC conference calling for pounds 4.15.

Later, in defiance of Mr Blair, Mr Morris made it clear he would support demands for a minimum of pounds 4.15 an hour at the Labour Party conference next month. "It is not part of my job to find imaginative ways of keeping the poor in poverty," Mr Morris said.

Mr Monks also departed from his modernising image with a series of comments made in an interview published today in Locomotive Journal, the magazine for Aslef, the train drivers' union.

The TUC leader predicts mounting militancy and makes clear his frustration with selfish, authoritarian management.

The union leaders' comments are certain to be used by the Government as a propaganda weapon to counter Mr Blair's appeal to the voters.

Demanding protection under a Labour government for differentials, the leaders of the Amalgamated Engineering and Electrical Union said they would come under intense pressure to maintain the pay gap between their members and the unskilled. Nigel Harris, acting president of the AEEU and a member of the Labour Party national executive, said he would fight to maintain those differentials.