Ed Balls twice hitched a lift in Lord Black's jet

Double blow to Labour hopeful as trips with peer return to haunt him and union backs Ed Miliband

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Ed Balls's campaign for the Labour leadership was dealt a double blow last night after it emerged that he had accepted hospitality from the notorious former media tycoon Lord Black.

The former education secretary, who has criticised Tory opponents for "private jet-setting and helicopter hops", confessed that he had twice flown as a guest in the peer's private jet after both had attended meetings of the shadowy international organisation the Bilderberg Group.

Mr Balls's involvement with the Bilderberg Group, a secretive collection of influential politicians and businessmen, opens him to charges of elitism at a time when he is attempting to persuade almost 170,000 Labour Party members to elect him as their next leader. It emerged yesterday that the huge union Unite had overwhelmingly decided to endorse his rival, Ed Miliband.

But the revelation that he had accepted Lord Black's hospitality, on a flight from Sweden to the UK in 2001 and home from Paris in 2003, is an embarrassing development, as it links Mr Balls directly to one of the most controversial businessmen of recent times.

Lord Black was released from a Florida prison on Wednesday, pending an appeal against his conviction for fraud and obstructing justice. He was convicted in 2007 of defrauding investors of $6.1m by paying himself a tax-free bonus from the sale of newspaper assets without the approval of the board of Hollinger International. He has always denied any wrongdoing.

The trips also sit uncomfortably with Mr Balls's condemnation of senior Tories including David Cameron, three years ago, for their "jet-set lifestyles". He ridiculed claims that the environmental impact of their flights in private aircraft was reduced by carbon-offsetting.

Mr Balls last night attempted to play down the significance of the revelation, claiming it was "ancient history" and insisting he had declared the trips to his then boss at the Treasury. He said the two men had discussed Lord Black's book on US President Franklin D Roosevelt during one of the trips.

The failure to win Unite's backing is a serious blow to Mr Balls's campaign, as he has now received the support of only one of the "Big Four" unions, while three have endorsed Ed Miliband, the other "leftist" Brownite candidate in the contest. Officials voted 24 to Ed Miliband, four each to Mr Balls and Andy Burnham, and one each to David Miliband and Diane Abbott.

Mr Balls's flights in Lord Black's private jet took place after the Bilderberg meetings in Stenungsbaden, Sweden, in 2001, and in Versailles, Paris, in 2003, in both cases before he became an MP. At the time, Mr Balls was working with his close ally Gordon Brown as chief economic adviser to the Treasury, a powerful unelected role that earned him the nickname "deputy chancellor".

The Bilderberg Group holds an annual conference of politicians, financiers and businessmen. It was originally proposed as an opportunity for European and US leaders to come together with the aim of promoting "Atlanticism". A number of British politicians, including Lord Healey, Lord Carrington and Lord Mandelson, have attended meetings. But the group has been consistently criticised over its secrecy and elitism.

Three years ago, during a parliamentary debate on aviation duties when he was a Treasury minister, Mr Balls criticised Mr Cameron for "lecturing the rest of us about things that clearly do not apply to him and his jet-set lifestyle".

He added: "Only yesterday, we learned more about his private jet-setting and helicopter hops, which included a 20-mile trip one month and a 30-mile trip the next. What signal does that send? It is like the signal of riding a bike to work while the chauffeur is driving behind with the shirt and shoes in the boot. The signal is that [Mr Cameron's] gestures and stance are not backed by substance."

The flight back from Sweden amounted to more than 650 miles, while the trip from Paris two years later was over 210 miles.

"I don't know why this ancient history is being dragged up now," said Mr Balls last night. "I did get a lift back with Mr Black from the meeting in France in 2003 and Sweden in 2001, when I was chief economic adviser to the Treasury.

"It saved the taxpayer the cost of a plane fare and on both occasions I declared it at the time to the permanent secretary in the normal way."