Refounding Labour Update

Colleagues,

I hope you have managed to get a relaxing break over the summer.

Since my last NEC report in July Refounding Labour has remained my top priority – reading through your submissions and engaging in the debate about the issues arising from them.  I know that some members have had concerns about the progress of the project to date and I have sought to address these as best I can.  I recently wrote an article for LabourList where I called on the party to do a number of things to demonstrate our commitment to an open transparent debate before agreeing which proposals would be put to conference.  As we are only a few weeks away from conference I felt it important to give you an update on where we’ve got to and to get your feedback on some of specific proposals currently being discussed.

Draft proposals

You will recall that Peter Hain circulated a summary of the draft proposals currently under discussion last month.   I stressed in my NEC report that this was very much a draft document and should be treated as such.   Since then LabourList have obtained a copy of the full, confidential, report which was put to the last NEC meeting.  I don’t know how they got it but since they have, and other journalists have started writing about the specific proposals it contains (e.g. the story in today’s Guardian), it is now very clearly in the public domain.   Given this I don’t believe it is fair for some members to have copies of it and not others or for members to discover what it contains via reports in the press.  I have therefore attached this here; Refounding_Labour_NEC_15july2011  so that you can see for yourself the full extent of the proposals being discussed and I hope that you will be encouraged by many of them.   The health warning that comes with this however  is that the debate has moved on in many areas since the document was drafted, specifically for example in respect of membership rates and funding for CLPs which I outline in more detail below.  I would however be very grateful for any comments you have on any of the proposals.

Membership rates

We have given further consideration to the issue of membership subscriptions and the different systems that could be introduced.  In the current fee structure there is, albeit perhaps not sufficiently understood, the ability to vary the membership payment according to income.  The current thinking is that with better publicity the current fee structure can be simple to understand and easily enforceable.  We would look to maintain the principle that those members who are low waged or unemployed pay the reduced rate and those members who are also members of trade unions pay the reduced rate.

However we would look to amend it to include the following;

• Low rate of £15 for local joiners – to encourage local recruitment.
• Low introductory rate of joining for registered supporters.
• To encourage retention there would be no large ‘jump’ in payment for low rate joiners, they should move to the reduced rate in their second year, and in the third year move to the rate appropriate for them.
• Adopt the Young Labour suggestions of £1 rate for ages 14 to 19 and £12 (£1 a month) for ages 20 to 26 – with young members moving to the reduced rate at the age of 27 for one year.
• Change the name of the parliamentary rate and make this rate applicable to all other remunerated elected representatives other than
  councillors – GLA members, Elected Mayors and other elected roles.
• Better encouragement to pay according to income band online and through membership publicity – so those that can pay more are
  encouraged to do so – but reassess the income bands so they are realistic and in line with the current fee structure.
• Make the online joining process and membership publicity clearer – ensuring that the reduced rate for low income, trade union members,
  and the unemployed is visibly displayed.
• Make it easy to sign up to monthly direct debit through membership publicity and online joining and renewing.

This would enable us to: achieve a lower joining rate; achieve a lower rate for the low waged and unemployed; include the Young Labour  ecommendations on youth rate; encourage local party recruitment, trade union membership, payment by direct debit and those that can
pay more to pay more; maintains a higher rate for elected representatives (except councillors) and is simple and enforceable.  

Funding of CLPs

You may remember that in my own submission to Refounding Labour I raised a concern that all CLPs face the same cost burden in respect of party fees regardless of their ability to pay and that some CLPS were excluded from our own internal democratic decision making process simply because they did not have the means to fund it.

Since the close of the consultation we have done further research into this issue and that absolutely substantiated the case for changing the way membership subscriptions are distributed between CLPs. Currently, CLPs receive an amount of money based on the number of individuals who are paid up members within their CLP, according to the rate at which those members pay. CLPs with large memberships therefore receive greater levels of membership subscriptions than those with a low membership.

It is right that membership subscriptions should reflect actual membership, not least because this serves as an incentive to recruitment.  But because party membership is closely tied to demography and geography, the reality is some CLPs gain members almost automatically while others struggle to make recruits despite very active endeavours. So the funds that follow members can sometimes seem to reward a CLP for its social location rather than its recruitment drive.

Furthermore, significant differences in the income that CLPs receive from membership subscriptions are compounded by the impact of the flat rate deductions which are taken from membership monies before they are distributed to local parties.   At present, prior to the payment of membership subscriptions to CLPs, a flat rate deduction in the form of the Euro Levy and Election insurance is made.  Following these deductions some CLPs receive no membership money at all and instead incur debt to the national party.  This can act as a disincentive to local fundraising as money raised is first used to pay off the annual incurred debt.

We want to achieve a more equitable distribution of money to CLPs which ensures that no CLP is left in the position where they simply end up with an ever increasing debt burden. A variety of options have been considered including: a flat fee per member; a percentage payment based on current size of CLP; or a cap on cash levels.

We are now looking at bringing forward a system that covers the cost of the two national deductions – Euro levy and insurances – for every CLP.  In addition, we would want CLPs to start a fresh – and therefore residual CLP debt, incurred before and during the 2010 General Election, would be written off.  We would also like to introduce free Contact Creator for all CLPs.  Currently the system for purchasing Contact Creator means that CLPs currently pay VAT payments that cannot be reclaimed.  With boundary changes and local government gains across the country, as a party we need to raise the campaign bar in every seat and Contact Creator is a vital tool in doing that.

Additionally, as I argued in my submission, we want to move to create a new NEC Diversity and Democracy Fund which would help the poorest CLPs with the cost of sending delegates to Annual, Scottish and Welsh Conferences, and for encouraging diversity at a local level.  There is a strong correlation between the amount of money a CLP has and their attendance at Annual Conference.

We are also looking to create a new NEC Local Campaigns and Improvement Fund which would specifically support local campaigning in the field – so activity is rewarded and incentivised, and match funding of projects could be considered, which encourages local fund-raising and activity.

Funding all of this will mean a move away from the current distribution of funds across CLPs and this could mean significant changes for those CLPs with the largest number of members.  We understand that transitional arrangements would need to be deployed to mitigate against the initial effect, allow for proper budgeting and election planning but do feel that this would be a fairer way of ensuring a basic level of provision for all.  I’d welcome your views on this. {

Publication of Refounding Labour Submissions        

I have argued for some weeks now that the Refounding Labour submissions should be published (whilst respecting those that have explicitly requested confidentiality).  I  continue to press Ed Miliband, Peter Hain and, our General Secretary Designate, Ian McNicol, for this so that all members can view them.  I know that they are all committed to this in principle but have had some logistical difficulties with delivery.  I  nderstand the frustration with this and I know that publication is an important step in giving the transparency needed for members to have confidence in the consultative process.  I will continue to press for these to be published in advance of conference and in good time for members
to consider them before taking a view on the proposals put to conference. 

Scottish Review

The deadline for submissions to the Scottish Review is Friday the 9^th September and I have also asked for an update on the recommendations arising from that consultation which might have a bearing on the proposals in Refounding Labour.

Next steps

The NEC’s Organisation Sub-Committee meets again on the 15^th September.  It is at that meeting that we will be trying to pull together  recommendations to go to the full NEC which meets again on the 20^th September.  Both of these are crucial meetings and I will try and get reports out to you as soon as possible after those meetings to let you know the decisions reached.  CLPs will want to ensure they make time between the proposals being agreed on the 20^th and conference to consider what their delegate’s response to those proposals at conference should be.  I am fully cognisant of the very tight timescales on all of this and will continue to press for CLPs to be given as much information as early as possible to try and maximise the time you have to consider your position.

I know this is an extremely busy and critical time and I want to thank you again for all that you do for the party.  If you want to discuss any of this please don’t hesitate to get in touch with me.

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