Postal union cuts cash to Labour by a third

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Tony Blair came under fresh pressure yesterday to abandon his pro-business policies as one of Labour's biggest financial donors slashed its payments to the party by a third.

Tony Blair came under fresh pressure yesterday to abandon his pro-business policies as one of Labour's biggest financial donors slashed its payments to the party by a third.

Leaders of the Communications Workers' Union (CWU) voted unanimously to reduce its contributions to Labour by £500,000 over three years. The initiative by the union follows news of massive job losses at Consignia, the renamed Post Office, brought on largely by ministers' insistence on introducing competition to the industry. Billy Hayes, the leader of the 280,000-strong union, said: "We gave Labour £1m before the last election and what did we get for it? 40,000 redundancies."

The sentiment is echoed by other unions which have either cut or ordered a review of their contributions to Labour in protest at the Government's alleged abandonment of core principles.

But the Chancellor, Gordon Brown, said yesterday that the Government would not be diverted from its aim of promoting an enterprise culture. "The gain is in jobs, rising living standards, greater stability, low interest rates and low inflation and an ability, through creating more wealth, to fund our public services. So we are not going to be diverted, whatever the pressures that people wish to place on us," he told BBC Radio 4's The World at One.

Mr Hayes said the union wanted to use the money it would have given to the Labour Party to protect its members. The CWU leader said the money would be used to fund a campaign against the "privatisation" of the Post Office.

Senior activists in Labour's largest affiliate, the public service union Unison, said its leadership would come under considerable pressure over its financial contributions. Geoffrey Martin, Unison's left-wing London convenor, said the organisation's national executive had been instructed to review the link with the party. Any attempt to fudge the issue at Unison's annual conference in June would "blow up in their faces," Mr Martin said.

The RMT rail union has demanded that Labour MPs whose constituency parties are backed by the union sign pledges which would put them at odds with Mr Blair.

The GMB general union decided last year to cut central donations to Labour by £2m over four years.

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