Dawn Butler was wrong to praise Militant’s rule of Liverpool – their record of contempt for workers still shames Labour.

Yesterday Dawn Butler proved that Labour’s cultural revolution is far from over by praising Liverpool Council’s period under hard-left Militant rule in the 1980s, unearthing an issue many thought buried by Neil Kinnock’s searing condemnation in his conference speech of 1985.

Butler claimed Derek Hatton’s Militant “stood up to Thatcher” and repeated their slogan “better to break the law than break the poor” – a slogan that invited the response “and with our housing benefit computer, we do both” from residents living under similar hard-left rule in Ted Knight’s Lambeth.

It means it’s worth revisiting Militant’s true record in Liverpool – especially for those who may have been too young to remember (perhaps including Dawn Butler who was 13 at the time).

Labour won control of Liverpool City Council after a long period of Liberal rule in May 1983. The new council’s leader John Hamilton was from the traditional Labour left – but real power rested with Militant councillors Tony Mulhearn and Derek Hatton, the latter of which became deputy leader.

In their first year of office the new council confronted the government over council spending and won a small victory when they were allowed to borrow more money over the short term. Militant presented this as a huge victory, while it proved ultimately career ending for environment secretary Patrick Jenkin (father of Bernard), as Margaret Thatcher hated the idea her government had been bested by a bunch of Trotskyists.

But this victory merely postponed the council’s financial reckoning.

The 1985 financial year saw Labour councils setting budgets while the miners’ strike raged and the Tories grabbed new powers to limit local tax increases through rate capping. Labour councils settled on the tactic of refusing to set a rate, at the time a position that presented a legal risk but was not illegal.

Militant-led Liverpool backed the tactic, but had nothing but contempt for fellow local government leaders like Ken Livingstone and David Blunkett. Militant regarded the cultural politics and engagement with race and sexual equality pioneered by Livingstone’s GLC as a distraction from the real business of class struggle. They insisted on overlooking locals to appoint a race advisor from London whose most visible qualification was his support for Militant, leading to accusations that they were waging a “race war” against Liverpool’s black community.

Like the miners’ strike, the anti-rate capping campaign began to crumble as winter turned to spring. Threats of legal action saw Livingstone’s GLC set a rate and sack their finance chief, a certain John McDonnell who refused to back his leader. In mid-June Liverpool too set a rate, but in the context of a budget with £30 million of unfunded spending commitments. The council would run out of money by the end of the year unless some other financial mechanism came into play.

By September the city council was in serious financial difficulties, and it was at this point that it save on redundancy payments by effectively sacking all its staff. Militant’s long-term plan was never quite clear, but after an attempt to foment a city-wide general strike had failed, they asked workers to accept a package where they got the sack and redundancy pay but would work for nothing until the end of the financial year. What would happen then was even more opaque, but Militant’s tactics appeared to be about rousing the city’s 30,000 staff to revolutionary fervour by threatening them all with unemployment.

Instead they were faced with one of the biggest and most successful trade union mobilisations of the 1980s. The local GMB branch was controlled by the Militant and the full time official of the T&G was Len McCluskey, who was very sympathetic to the Militant but had been unable, even before all this happened, to get his members to back Hatton and co. But the other unions – NUPE, NALGO and the NUT – were understandably outraged, not least because the city council’s redundancy notices threatened staff with disciplinary action if they raised it with their union.

Today Militant say nobody was issued with a redundancy notice – and they are right. But the reason is that the unions instructed their members to obstruct their distribution. This was the moment when, notoriously, the city council hired private taxis to distribute them around the city as a prelude to them being issued.

And then more or less at this moment Neil Kinnock delivered that speech to 1985 Labour Party conference and things were never the same again.

The city council extracted itself from the financial mess by more borrowing and the Labour Party’s NEC uncovered a culture of bullying inside the Liverpool district party that led to Hatton’s expulsion from Labour in 1986 after a long-running legal battle.

Derek Hatton recently announced his intention to re-join the Labour Party.