Westminster Blog

Unite, Britain’s biggest union, has revealed a sharp drop in global membership after discovering a quarter of a million “ghosts” who did not in fact belong to the organisation.

The group has reported a fall in its membership from 1.95m to 1.64m, equivalent to a drop of 310,000, in its annual report published this week. It later clarified this as mainly a “tidying-up exercise” as officials excised the names of former members who had left or died years earlier.

Even so, Unite admitted that it had probably lost about 30,000 members during the past year because of the recession. It forecast an even steeper haemorrhaging of members during 2009 as the downturn worsened.

Privately, officials expect the loss of as many as 150,000 members during the course of the year for the super-union, which was created through the merger of the T&G and Amicus.

UK membership was reported to be 1.54m, down from 1.84m a year earlier. “Next year’s figures unfortunately will be much worse, almost certainly,” the union said a spokesman. “The most likely projection will be of membership losses this year, quite significant ones, especially in the manufacturing and finance sectors.”

Unite has reported a £19.5m deficit for the past year after writing down investments in property and shares that were damaged by the financial downturn.

I revealed in February that Unite had made unspecified paper losses on a portfolio of financial assets that had been worth £102m before the recent stock market crash.

Those quoted investments are now worth £71.7m – a fall of £30m – according to Unite’s annual accounts, published yesterday. The union’s accountants registered an “impairment of properties” of £11.9m and an “impairment of investments” of £10.8m.

Unite is not the only union to have lost money on the stock market in the last year. But it could arguably have kept the cash in the bank – which is what Unison has done.

Unite’s financial position is of wider political importance because the group is Labour’s biggest donor. The party now receives more than 90 per cent of its annual donations from unions.

However, a spokesman for the union said it had achieved its aim of matching underlying expenditure with income despite these exceptional costs. And he said: “When stock markets go back up, some of that loss will be recovered.”

Unite’s financial position is of wider political importance because the group is Labour’s biggest donor. The party now receives more than 90 per cent of its annual donations from unions.

The TUC, the umbrella group for Britain’s unions, has predicted an overall fall in membership – at least in the short-term – because of the recession.

Union membership peaked at 12.1m in 1979. For the next two decades it then fell before remaining stable at about 6.5m since 1999.

The figure is likely to drop this year, however, given that many forecasters expect unemployment to rise to 3m by Christmas.

“Unlike the recessions of the early 1980s and 1990s the current downturn is hitting a wide range of sectors – and hence may impact upon a range of unions,” the TUC said in a recent report.

However, Paul Nowak, national organiser of the TUC, said some unions were still increasing membership, for example Unison, Accord and the RMT.

The GMB’s membership figures for 2008, published at the same time, showed a slight rise from 590,125 to 601,131. The membership of Unison – the public sector union – rose from 1.34m to 1.36m.