The latest figures from the Electoral Commission show the party brings exactly the same level of incompetence to their own finances as they do to the nation’s.
With outstanding debts of £12.3 million (compared to the Conservatives’ debts of £1.8 million, despite very similar amounts of income), the Opposition have run their party into the same mess they wanted to implement nationally.
Just as their commitment to never-ending debt would have hammered the willingness of financial institutions to lend to the UK, creditors have lost faith in Ed Miliband’s party. Labour’s overdraft facility has been cut to £90,000 – compared to the £10.1 million available to the Tories should they need it.
In short, they are currently living out a stark warning against the consequences of the left’s fantasy economics. Borrow, borrow, borrow has left them with sky-high levels of debt, poor credit, and an awful reputation with lenders.
There are practical consequences, as well as the symbolic importance of the mess.
Three years into a Parliament, this is when parties try to amass a war chest. Without one, they have to either borrow or use their overdraft to fund campaigns. It’s hard to see how Miliband can put money aside or borrow any more with such large debts to service, and a £90,000 overdraft won’t go very far in a General Election campaign.
By contrast, the Tories are clearing the decks in advance of the election – they paid off £1.3 million of debts last quarter, 40 per cent of the total amount, while Labour paid off £385,000, only 3 per cent of their outstanding debts.
Then there is the impact on potential donors. People giving their money want to know it will be used well to fight for a cause – not that it will be squandered by an incompetent party machine or immediately used to pay debt interest. Labour fundraisers will face awkward questions when they go round with the begging bowl.
All of that means Miliband is set to become more reliant on his remaining large-scale donors: you guessed it, the unions. His “reforms” to the union link mean that General Secretaries like Len McCluskey have more say over whether to give to Labour or not, and the union bosses seem keen to make the donations more conditional on Labour following their preferred policy direction.
None of which paints a pretty picture for the future of Ed Miliband. Not only will he be forced to bend to McCluskey’s every whim for the foreseeable future, but voters will wonder why they should trust Labour with their taxes when the party can’t even keep its own finances in order.