The union Unite has halved the fee it pays to the Labour Party by 40 per cent.
The union, historically one of Labour's highest donors, raged at Sir Keir Starmer's party for dragging its feet on paying bin workers in Birmingham, who have now been on strike for over a year.
It will decrease the amount it funds Sir Keir's party from £1.45million to £870,000, a move which the union said "shows the anger of Unite members".
Unite's general secretary Sharon Graham said members "are coming to the end of the line as far Labour is concerned".
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"Workers are scratching their heads asking whose side are Labour on, who do they really represent, because it certainly isn’t workers. Workers and communities are paying the price.
"Labour needs to wake up and smell the coffee. The cut in affiliation fee shows the anger of Unite members. Stop taking workers for granted, spine up, do your job and be real Labour."
A Labour Party spokesman said: "It is incredibly frustrating that the bins dispute has not yet been resolved. Unite could and should end the strikes."
The spokesman added it was proud to be funded by party members, trade union members, donors, and affiliates.
PITCURED: Unite general secretary Sharon Graham leading a march for Birmingham's bin workers
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The dispute began when Labour-led Birmingham City Council cut the Waste Recycling and Collection Officer posts, and a year on the two sides have still failed to reach a solution.
Historically, Unite has been Labour's biggest union donor, but its relationship with Labour has been tenuous in recent years.
In 2024, Unite refused to donate to the party, and it did not endorse Labour's General Election manifesto.
And in 2020, the union cut its affiliation sum by 10 per cent.
LATEST ON THE BIRMINGHAM BIN STRIKES:
PICTURED: A picket line in central Birmingham in support of the Birmingham bin workers
|GETTY
Unite said it plans to escalate the strike in Birmingham, but did not elaborate on what this might look like.
The union, which represents over 1.2 million workers in a variety of fields, also said: "Labour’s incompetent behaviour in Birmingham has come on the back of a failed economic strategy, that has left our industrial base fighting for its life.
"Oil and gas workers facing decimation, buy British defence promises broken, the public sector undervalued and the elderly and disabled under attack."
Unite now plans to formally consult with members to see if they wish to remain affiliated with Labour ahead of the union's rules conference next year.
Unite has said Sir Keir's party has a 'failed economic strategy' and plans to consult members on the union's affiliation
|GETTY
Birmingham City Council said it plans to start a new waste collection plan in the summer and reinstate the recycling service, even if strike action continues.
Councillor Majid Mahmood, cabinet member for environment and transport, said the authority is actively seeking to end the dispute.
He said the council had made "a series of offers" to the union, none of which had been approved.
"My message to those still taking industrial action is simple: Come back to work as I want you to be part of this new and improved service. Our door remains open," he added.
Reform UK's Treasury Spokesman, Robert Jenrick, told GB News Birmingham was in an "appalling state".
He said with the upcoming May elections, he hoped people would vote to "bring in new leadership".
"I hope that's a Reform council. We're actually working very hard," he said.
He added: "This is going to be a big moment where people can vote out a council that has let them down so badly and bring in change."
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