Falkirk: now Labour hands evidence over 'seat-rigging' to police

Mr Miliband this morning called on Unite leader Len McCluskey to condemn "malpractice" in Falkirk, insisting he would not allow the party's name to be "undermined by the behaviour of a few individuals".

But Mr McCluskey has demanded an independent inquiry, saying that he had "no trust" in the party's handling of the affair.

A Labour source said: "After consulting the party solicitor yesterday, we will hand our Falkirk report and other evidence to the police this afternoon."

Conservatives said it appeared that Mr Miliband was "bounced" into calling in the police after discovering that Tory MP had written to the Chief Constable of Scotland, Sir Stephen House, asking for a probe.

Crawley MP Henry Smith told Sir Stephen that Unite may have committed fraud by making a false instrument, in the form of an application form signing up members to the Labour Party without their knowledge. And he said the separate offence of "uttering" may have been committed by tendering forged documents with an intention to defraud.

"I am deeply concerned that a serious offence may have been committed in this instance," wrote Mr Smith. "I would be very grateful if you could investigate this as a matter of urgency, in the interest of protecting the integrity of the democratic process in Scotland."

A Conservative source pointed out that Mr Miliband made no mention of the police in a round of broadcast interviews shortly before it was announced that evidence would be handed over. "It's obvious that Labour are panicking and have been bounced into referring this matter to the police," said the source.

Mr McCluskey has said he had "no trust" in the party's handling of the Falkirk issue, after candidate Karie Murphy and constituency chairman Stephen Deans were suspended from the party and election co-ordinator Tom Watson - who has close links with Unite - stepped down from the Shadow Cabinet.

But Mr Miliband dismissed the union boss's smear claim as "total nonsense" and said Mr McCluskey should "face up to what people within your union were doing".

Speaking at a charity event in London, Mr Miliband said: "The Labour Party I lead will select its candidates in a fair and transparent way. We will act without fear or favour.

"Instead of defending what happened in Falkirk, Len McCluskey should be facing up to his responsibilities. He should not be defending the machine politics involving bad practice and malpractice that went on there, he should be facing up to it."

Mr Miliband went on: "We had members being signed up without their knowledge, bad practice, malpractice and, frankly, instead of defending that kind of thing, Len McCluskey should be condemning it."

Conservatives have seized on the escalating row as proof of Mr Miliband's "weakness" in handling relations with Unite, which has given Labour more than £8 million in donations since he was elected leader in 2010.

During a hospital visit, Prime Minister David Cameron said: "It's quite clear the trade unions have far too much control over Labour. This has happened on Ed Miliband's watch. It is something of a scandal that is unfolding and he badly needs to grip it."

In an apparent indication that he regards the row as a chance to show that control of the party is in his hands, and not those of the union bosses, Mr Miliband said: "Let nobody be in any doubt, there is only going to be one outcome to this: the Labour Party will act in a way that upholds the integrity of our party, the integrity of our party members and the integrity of ordinary trade union members.

"I will not allow the good name of the Labour Party to be undermined by the behaviour of a few individuals."

Mr Watson said his decision to resign as Labour's election supremo and deputy chairman was prompted in part by unattributed briefing by Shadow Cabinet colleagues disgruntled over his role in the removal of Tony Blair as leader. The West Bromwich East MP quit the Labour frontbench in 2006 after being named as part of a "curry house plot" against the then PM, who soon afterwards announced plans to stand down.

"I kept reading in papers that there were unattributed briefings from the Shadow Cabinet," Mr Watson told BBC Radio WM. "There was clearly a problem with some of my colleagues around the Shadow Cabinet table and obviously I do accept that. It was a big thing I did in 2006.

"But what I don't want to do is make that a problem. I think I can do things from the backbenches that are as effective and serve my constituency just as well, maybe better. So, no hard feelings, I'm off."

Mr Watson said he had been considering resigning "for a few months", after finding the co-ordinator post was very tiring and prevented him from speaking out on issues of concern. In his letter of resignation, he revealed that he offered to go on Tuesday but was asked by Mr Miliband to reconsider.

Mr Miliband has shut down a scheme under which unions could pay for their members to join the party, following an internal inquiry into complaints about membership irregularities in the Falkirk constituency Labour party (CLP).

But Mr McCluskey angrily denounced the inquiry as a "stitch-up" and demanded an independent investigation into the allegations.

In an incendiary letter to Labour's general secretary, Iain McNicol, Mr McCluskey said: "I am obliged to uphold the integrity of Unite, and I can no longer do so on the basis of going along with the activities of a Labour Party administration in which I can place no trust."

Conservative Party chairman Grant Shapps wrote to Mr Miliband demanding the publication of the internal report, which Labour insists must remain private because it contains evidence given in confidence.

Mr Shapps also asked Mr Miliband whether he would suspend candidates in 40 other seats named in a leaked Unite document as enjoying support from the union in selection contests. Labour insists it has no evidence of membership irregularities in any constituencies outside Falkirk.

"This week we have seen the full extent of Len McCluskey's takeover of the Labour Party," said Mr Shapps.

"This is not simply an internal Labour Party matter. If you are asking Britain's hard-working people to elect Labour in 2015, then they have a right to know who exactly they are voting for - Ed Miliband or Len McCluskey."

Labour's shadow business secretary Chuka Umunna said: "I can confirm that we took advice yesterday in relation to the Falkirk matter and as a result of the advice given, have decided swiftly and strongly to refer it to the police.

"There is absolutely no place in the Labour Party for machine politics of this type, and where we find it we will root it out and stamp on it," he told BBC Radio 4's World at One.

"It is not a way to conduct things within a constituency party."

Pressed on whether Labour would be publishing the internal report, Mr Umunna stressed that evidence had been gathered on a "confidential" basis. "We are not publishing it," he added.

Labour frontbencher Diane Abbott denied that Mr Miliband had "over-reacted", but said the Labour leader was pushed into taking tough action by media commentators who portray him as a puppet of the unions.

Ms Abbott told BBC2's Daily Politics: "I think he is doing all he can do, because of constant relentless pressure from commentators saying he is a tool of the unions, when anyone who knows the unions and knows Ed knows that's not really true. So he has to be seen to take the position he does."

Asked if he had over-reacted to the situation, she said: "No, he has been pushed by commentators who want to insist he is a puppet of the unions when all evidence says he is not."

Conservatives said they were handing over to police a Unite document which they have obtained, listing 41 constituencies in which the union has supported candidates for selection.

The report, presented in June by the union's political director Steve Hart, said that Unite's political department was "working extremely hard on assisting in a large and growing number of selections".

The Scottish National Party's MSP for Falkirk West, Michael Matheson, said: "The situation in Falkirk is bringing shame on the Labour Party, and (Scottish Labour leader) Johann Lamont's silence on the matter is becoming deafening. She has to speak up now and try to show that she is even concerned, never mind has any control over her own party in Scotland.

"Whatever else emerges from this scandal, it confirms that the shots are all being called by the real Labour bosses in London, and the people of Falkirk have been let down.

"People in Falkirk deserve so much better. They should be able to elect a new MP - there needs to be a by-election, and the sooner the better."

Mr McCluskey said Unite would co-operate with the police inquiry but warned that it would not bring the matter to an end.

He insisted that only an independent inquiry could get to the truth of what had happened.

"At the moment we are in the middle of a media storm that has been caused by Labour's inability to deal with this situation," he said.

"The Labour leadership have shot themselves in the foot and created this media storm over what is a genuinely irrelevant issue to ordinary British workers.

"As far as Unite are concerned, we have done nothing wrong. We are being attacked mercilessly by the media.

"It is a nonsense and I am afraid the way it has been handled by the Labour Party headquarters is nothing short of disgraceful."

A clearly emotional Mr McCluskey accused the Labour leadership of deliberately picking a fight in an echo of Tony Blair's "Clause IV moment" when he got rid of Labour's historic commitment to collective ownership.

"We believe they have handled it absolutely amateurishly and they have played into the Prime Minister's and the Coalition's hands. They must be rubbing their hands at this," he said.

"The responsibility for that lies fairly and squarely at the doorstep of Labour headquarters. I urge the Labour leadership to stop responding to the Tory agenda.

"It is depressing that Labour leaders seem to want to have a Clause IV moment, they have got to have a situation where they punch-up union leaders. Ed doesn't need to punch up me, I'm his friend, I support him."

Mr McCluskey said he could not understand what the union was supposed to have done wrong.

"We've had shadow cabinet members saying that Unite have 'overstepped the mark'. What does that mean? We asked too many of our members to join the Labour Party. We should have told them that the Labour Party was full up perhaps? It is a nonsense," he said.