Visitors exit the Co-Operative Group Ltd.'s headquarters in Manchester, U.K., on Thursday, March 20, 2014. Co-Op will report "large losses" for 2013 within the next few weeks, and a review into how the banking unit fell short of capital will be published in April, former Chief Executive Officer Euan Sutherland wrote in a recent Facebook posting, before resigning last week. Photographer: Paul Thomas/Bloomberg

The Co-operative party’s historic link to the Labour party is under pressure even after it defeated an attempt to cut its funding from the Co-operative Group.

Co-op Group members voted narrowly to keep funding the Co-operative party, which shares 24 MPs with Labour and provides tens of thousands of pounds to it each year.

About 55 per cent agreed to provide as much as £1m in political funding, including £625,000 in subscriptions, to the century-old party over the next 18 months.

Allan Leighton, chairman of the Co-op Group, said there was a “clear mandate” to continue the relationship for at least another year.

However, some at the mutual’s annual meeting in Manchester questioned whether the exclusive electoral pact with Labour should continue, amid fears it could dissuade shoppers. Mr Leighton said: “We have to be much clearer about what we are going to get [from the Co-op party].”

A Labour supporter, he said he had no desire to force change but there was only a “fine majority” in favour.

Karin Christiansen, general secretary of the Co-op party, told the Financial Times the link with Labour could be re-examined.

“These are important questions for the party as well as the movement. We will sit down and discuss them. We need to keep relevant in the 21st century. The party and movement need to go forward.”

However, she added that partnering a party that could be in government helped achieve a level playing field with big business.

“In the British political system legislative power lies with the two main parties. But it is the movement’s decision.”

A member from Scotland told the annual meeting that the group should break the pact because it was costing customers in nationalist Scotland. “I spend a lot of time persuading people not to boycott the Co-op because of our electoral link with Labour,” he said.

The Midcounties Co-op, the largest independent society, has already set up a campaigns fund while maintaining its Co-op party subscription. This allows it to support a wider number of parties and groups. It has said there was a question of “how the society’s political stance impacts on its commercial activities” and whether it deterred shoppers.

Most speakers at the annual meeting backed the Labour link. In 2014 the Co-op party made donations of less than £50,000 to Labour. It gave £1,200 this year to prominent Labour MPs including shadow chancellor Chris Leslie, Lucy Powell, who helped run the election campaign, and Stella Creasy.

Of 2.8m eligible Co-op Group members, about 93,000 voted.

Get alerts on Companies when a new story is published

Copyright The Financial Times Limited 2021. All rights reserved.
Reuse this content (opens in new window) CommentsJump to comments section

Follow the topics in this article