Media playback is unsupported on your device Media caption Dave Prentis: "Where I was brought up... you were always taught never wash your dirty linen in public"

The UK Labour Party faces an election meltdown like that experienced by its Australian counterpart unless it stops its "squabbles" with the unions, leader Ed Miliband has been warned.

Dave Prentis, general secretary of the public sector union Unison, said the party had to "get its act together".

Mr Miliband wants to make changes to funding, saying they will boost party membership and make it more effective.

But Mr Prentis dismissed some of his ideas as "living in cloud cuckoo land".

The row looks set to dominate the TUC's annual congress in Bournemouth this week, which Mr Miliband will address on Tuesday.

The Labour leader insists that removing the automatic affiliation fees paid by millions of union members to his party will ensure that only those with an active interest are involved in future.

'Disunited'

They will be asked instead whether they want to "opt in" to become full members of the party.

Analysis This is no longer a row about a local spat in Falkirk, but a much deeper question about the Labour movement, its finances and its leadership. There is open disagreement: disagreement over the principle of Ed Miliband's idea; disagreement too about the implications of attempting this change now. To some this is necessary modernisation. To others it projects an image of bickering over internal reform. Those around Ed Miliband tell me they are more determined than ever to push ahead with this. But you can be sure too they'll be pretty keen to move the agenda on to something else too - and talk about policies.

Mr Miliband acknowledges this will cost Labour much of its funding, but argues it will make the party stronger.

The proposed changes follow a row over allegations that the Unite union tried to rig the Labour choice of a candidate for the Falkirk seat at the next general election. An investigation by Labour has found no evidence of wrongdoing.

The GMB union has already said it will cut the money it gives to the party in response to Mr Miliband's plans.

Speaking at the press conference ahead of the TUC congress, Mr Prentis - whose union already has the "opt-in" system for funding Labour - cited the example of the Labor Party in Australia, which has just lost power after six years.

Kevin Rudd's party was beset by power struggles which saw Mr Rudd oust predecessor Julia Gillard just a few months before polling day.

Mr Prentis warned that people in the UK would also "not vote for squabbles in the party".

He said: "We have seen what happened in Australia. It will happen to the Labour Party in this country unless it gets its act together."

Mr Miliband has promised a special conference early next year to discuss the union funding proposals.

'Shake hands'

But Mr Prentis said: "We look like a disunited party. Where I was brought up in Leeds, we were taught not to get our dirty linen out in public. If you are divided you lose support in the country.

LABOUR FUNDING FROM JANUARY TO JUNE 2013 Total - £16.84m

Membership fees and small donations - £4.85m

Fundraising and commercial activities - £4.20m

Union donations and affiliation fees - £4.16m

Government grants - £3.62m

Source: Labour Party

"It's happened to the Tories before. If they think squabbles and a special conference are the ways to get our members to vote Labour they are living in cloud cuckoo land."

He added: "We are now in the election period. For us to have special conferences contemplating our navels is living in cloud cuckoo land."

Earlier, Unite general secretary Len McCluskey told BBC One's Andrew Marr Show he was "delighted" the union had been "vindicated" over Falkirk vote-rigging allegations.

And TUC general secretary Frances O'Grady said her advice to both sides was to "shake hands and move on" and predicted the Labour leader would get a "good reception" when he spoke to delegates.

A senior Labour source told the BBC: "We want to be able to talk directly to Unite's members, the GMB's members and Unison's members. Dave Prentis is a lovely bloke. We'll always listen to him but we do need a direct, individual, personal representation to join us.

"It will strength the Labour Party. It will strengthen trade unions. It will strengthen Britain.

"We like trade unions. We like trade union structures. They are brilliant voluntary structures, but we want direct personal relationships with their members."

On Tuesday, Mr Miliband is expected to tell the conference: "We need to build a party truly rooted in the lives of all the working people of Britain once more.

"That is what my reforms are about. It is the right thing to do. We have to change.

"And I am absolutely determined to make this change happen."

Labour has stressed that its Falkirk findings came after "key evidence" was withdrawn - with current MP Eric Joyce claiming people were "prevailed upon" to do so.