Trade Union Modernisation Fund
This paper examines the nature and process of trade union modernisation in Britain, through an analysis of the Labour government's Trade Union Modernisation Fund (UMF). The UMF was launched in 2005 to provide funding for small-scale innovation projects. It is somewhat controversial. Critics on the political right regard the funding as a government 'back hander' to the unions. Critics on the political left, including many industrial relations commentators, consider the UMF either irrelevant or indicative of how 'new Labour' has treated the union movement since election in 1997. In Ewing's (2005) terms, this would be characterised as an attempt by the state to explicitly shape the operations and functions of trade unions in line with wider economic and political objectives. This, it is argued has led to the emergence of a new 'supply side trade unionism', based on diminished regulatory and representation functions. The potential gains for the union movement in UMF participation have not been considered. The key concern of the paper is to examine how the state has sought to influence the modernisation processes of trade unions via the UMF, the union response and what the potential gains may be.
The UMF represents an attempt by the state to facilitate the operational modernisation of trade unions, so that unions may better respond to changing labour market conditions (Stuart et al. 2006, 2008). To understand the context in which this attempt at modernisation is taking place, we need to understand two things. First, what is the environment that unions are currently facing? Second, how have unions, as administrative entities, responded to this environment. We then consider how the UMF should be understood within the wider pattern of government/union relations.
British Trade Unions
Since 1979 trade union influence in Britain has declined dramatically. Union membership fell from 13.3 million in 1979 to around 7.6 million by 2008, and union density from 57 per cent to 28 percent (Certification Office 2008, Mercer & Notley 2008). Whilst the rate of decline has slowed somewhat since 1997, the trajectory has remained downwards. There are wide differences between the public and private sectors, with 59 per cent of public sector workers union members in 2007 compared to just 16 per cent in the private sector. Collective bargaining coverage now covers just 34 per cent of employees. Where unions retain bargaining rights, they bargain over a narrower range of issues (Kersley et al. 2006), whilst the union mark up has declined along with the ability of unions to reduce wage inequality (Addison et al. 2006). However, unions continue to act as a 'sword of justice' boosting the wages and narrowing pay inequality among disadvantaged groups in the labour market (Metcalf et al. 2001).
Unions also face a very different labour market, compared to the 1970s 'high tide' of membership. Their environment is far more legalistic, and compulsory trade union membership (the closed shop) has been outlawed. Employment in manufacturing and key industrial sectors, once the heartlands of union power and membership, has declined dramatically: in 1984 25 per cent of employees worked in manufacturing, compared to current employment of just 13 per cent; employment in services has increased just as dramatically. The unions which have prospered in this new environment have largely been those that represent professionals in education and medicine.
British Unions as Administrative Entities
As organisational bodies trade unions are unusual, in that union organisation is the sum of both a professional, employed workforce and an elected and voluntary body of lay activists. Unions thus face a tension between being administrative bodies, tasked with the efficient operation of their own internal affairs and of their representative obligations to their members (supporting collective bargaining, providing legal advice and support etc. …