Labour could be on the verge of a potentially humiliating U-turn forcing it to ask G4S to run its annual conference’s security, despite having pledged to boycott the firm over links to Israeli prisons.

Party sources said today that with an industrial dispute currently blocking the employment of rival firm Showsec, it is likely officials will find themselves “picking up the phone to G4S”.

One MP today claimed the row over conference security had become a “proxy war” for factions fighting it out over Labour’s future – with a Corbyn supporting union on one side and another union backing leadership rival Owen Smith on the other.

With some speculating that conference may have to be cancelled altogether, a party source said: “It is absolutely going to go ahead.

“They think they’ll end up picking up the phone to G4S on the basis they are the only ones who can do it.”

The row over conference security is rooted in the decision of Labour’s National Executive Committee last year to boycott G4S after it was claimed the firm was linked to prisons holding Palestinian political inmates.

Unite the Union, one of Mr Corbyn’s strongest backers which sits on the NEC, was a key force in the NEC’s decision and in the broader Stop G4S campaign.

But when other firms declined the contract to run security at Labour conference officials found themselves dealing with Showsec, which has an on-going industrial dispute with the Smith-supporting GMB union.

The GMB had even threatened to picket the Labour party’s conference if Showsec are given the contract.

Then earlier this week GMB, which also has representation on the NEC, won the Labour committee’s support for its push to force Showsec to recognise the union, creating a barrier to the firm being employed.

An email has since been leaked to the Politics Home website in which GMB General Secretary Tim Roache accused Unite boss Len McCluskey of trying to interfere in the Showsec dispute, claiming it was “incredibly unhelpful”.

Instead he suggested Mr McCluskey intervene to “allow urgent discussions with G4S”.

In March this year G4S said it would sell its Israeli business “in the next 12 to 24 months”.

A spokesman at Mr McCluskey’s union said: “Unite is working with the Labour party, including with our colleagues in the GMB, to find a satisfactory security contractor for conference this year.”

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A Labour MP today said: “The whole thing is a complete farce.

“It’s like it’s become a proxy war for Labour’s broader disputes and is indicative of where we are as a party at the moment, we have degenerated into naval-gazing.”

It coincides with another row over the attendance of Mr Corbyn and Shadow Chancellor John McDonnell at a “rival conference” of Momentum activists set up to run at the same time as Labour’s official event.