Ed Miliband is under mounting Labour pressure to curb the power of the party's trade union founders amid growing concern about their attempts to secure more union-backed MPs.
Labour admitted that an internal inquiry had discovered that up to 500 new party members had had their subscriptions paid by unions in the past year. The disclosure followed allegations that Unite, Labour's biggest donor, recruited up to 100 party members in Falkirk, Scotland, in the hope of installing its favoured candidate Karie Murphy as Labour's standard-bearer at the 2015 election.
The controversy was fuelled by a leaked Unite document suggesting that the union is running a “furious” operation to parachute candidates into 41 marginal constituencies including Falkirk. The report, presented to Unite's executive council last month, says the selection of Labour candidates has “dominated” the union's political efforts.
An uncomfortable Mr Miliband was taunted by David Cameron over Unite's influence at Prime Minister's Questions. The Labour leader is now being urged by close allies to clip the unions' wings to defuse Tory allegations that he is “weak” in the face of union power. There is concern that Unite is using a campaign to ensure there are more working class MPs to mask its drive to get its own members into Parliament.
One Labour frontbencher said: “This is starting to damage us in the eyes of the public. Ed has got to get a grip. Unite wants delegates, not representatives, in Parliament. That has got to be stopped.”
A former Labour Cabinet minister added: “The problem is we are so reliant on finances from one source. There will come a time when we will need to confront the issue of our relationship with the unions. I'm not saying we will have to break the link, but we will have to do something.”
Labour sources said the party leadership welcomed unions' efforts to boost party membership and secure more working class MPs. But they confirmed that Labour will consider scrapping a scheme, introduced in the Blair era, which allows unions to pay the first year's subscriptions of party members they recruit.
Mr Cameron told Mr Miliband he was “too weak to stand up to the Unite union and too weak to run Labour and certainly too weak to run the country.” He added: “We've got one of our political parties where it's become apparent votes are being bought, people are being signed up without consent, all done by the man - Len McCluskey [Unite's general secretary] - who gave him his job.”
Labour officials insisted the party leadership acted swiftly when the Falkirk allegations emerged by taking control of the candidate selection process from the local party. They said there was no evidence of “similar activities” in other constituencies where unions had paid new members' fees, saying the rest of the 500 were not concentrated in particular seats.
Mr McCluskey said: “There can be absolutely no question about who runs the Labour Party: it is Ed Miliband and he has my full support. Yes, there may be issues we disagree on, that is allowed in a democratic party, but Unite is fully behind Ed Miliband and after today's performance by Cameron, the sooner he is prime minister the better.”