Unions have warned they will not be relegated to Labour's "placard carriers and cheque writers" in the wake of the Falkirk allegations.

The criticism came as Labour leader Ed Miliband held talks with the general secretary of the GMB union a day after Paul Kenny announced he was slashing its affiliate funding by 90%.

Labour sources called the meeting "constructive" but added that Mr Miliband had not swayed in his determination to reform Labour's relationship with the unions.

Mr Miliband has called for union members to "opt in" and join Labour rather than being automatically affiliated through their organisation.

But even the party's own MPs warn that the reforms could cost the party millions.

The reforms were announced following accusations Unite attempted to influence the selection of Labour's candidate to stand in Falkirk at the next Westminster election.

Speaking after the meeting, Mr Kenny called Mr Miliband a "really decent bloke".

But he warned the Labour leader's actions would have "consequences".

"I don't think people understand the consequences," he added.

"Having the GMB point out what the possible implications are may focus people's minds."

A union source added: "The vision seems to be: ditch the affiliation but don't ditch the unions altogether.

"Our role would be one of placard carriers and cheque writers."

On Wednesday the GMB announced it would cut its affiliation funds from £1.2 million to £150,000.