Britain: How the Labour Party was formed – lessons for today

Keir Starmer, Britain’s Prime Minister, is everyday revealing the extent to which he is determined to govern in the interests of the capitalist bosses. His party, the Labour Party, was founded by the trade unions 125 years ago, but it is today completely dominated by the pro-capitalist leadership of him and others.

Any democratic channels the working class had to apply its pressure on the leadership, through the trade unions and party structures, have been removed. For instance, despite the 2022 Labour conference supporting the motion from the Communication Workers Union to renationalise Royal Mail, in December 2024, Starmer’s Labour agreed its sale to a Czech billionaire. Unite the Union convinced the 2024 Labour Conference to support the continuation of the pensioners’ Winter Fuel Allowance – the Labour leadership has refused to do that and is preparing further welfare cuts.

Formed by unions

The Labour Party was formed by the trade union and working-class movement, attempting to build a force that would represent the interests of working people, against the capitalist class and its political parties.

125 years ago, on 27 February 1900, 129 delegates representing 570,000 members in 41 trade unions and seven trade councils came together in Memorial Hall, London, to form the Labour Representation Committee, which later became the Labour Party. The meeting also included representatives from three socialist organisations: the Independent Labour Party, representing 13,000 members; the Social Democratic Federation, 9,000; and the Fabian Society, 861.

The 1900 founding was just one milestone on the course of the working class struggling for a political voice, independent of the established Liberal and Tory Parties.

Thirteen years earlier, the question of challenging the dominance in Parliament by parties representing the employers and landed aristocracy had spilled into the 1887 Trades Union Congress (TUC) when James Keir Hardie, then a young delegate representing Scottish miners, proposed forming an independent workers’ party. He faced fierce opposition from Liberal-affiliated delegates who argued such a move would split the ‘progressive vote’ and benefit the Tories. This ‘lesser-evilism’ argument continues to echo down the ages.

The preceding years, 1873 to 1896 had been ones of economic downturn, known as the Great Depression (before the 1930s redefined that term). It exposed the limitations of the then existing union-employer collaboration. Fredrich Engels wrote in 1885 that the English working class would lose its privileged position as Britain’s industrial monopoly declined, predicting this would revive socialist politics.

Britain faced mounting competition from Germany and America in key industries like textiles and iron, while cheaper agricultural imports from North America and Australia devastated agricultural prices.

Strike wave

The years 1888-92 saw a spectacular wave of strikes by previously unorganised, unskilled and semi-skilled workers. ‘New Unionism’ emerged as a more militant, inclusive trade unionism prioritising direct action.

Gas workers led by Will Thorne won a victory in 1889, establishing the National Union of Gas Workers and General Labourers (which became today’s GMB). Ben Tillett led the London dock strike later the same year. Both disputes brought previously unorganised workers into the movement under socialist leadership. Trade union membership doubled from 900,000 in 1889 to two million in 1890, with 60 new trade councils established nationwide.

The Eight-Hour League was formed in 1884 to fight for legislation of an eight-hour workday across all industries. Its first secretary was Tom Mann, who later became a leader of both the engineering and transport unions.

But while gas workers had won the eight-hour day in London, other strikes for shorter working hours were defeated, reinforcing the need for a political solution.

Hardie’s motion for a legal eight-hour day at the 1889 TUC Congress was narrowly defeated, but later passed in 1890.

Strikes and political struggles led to various independent labour organisations forming that began fielding candidates in local and national elections, challenging the dominance of the established parties.

Workers’ experience accelerated understanding of the need for workers’ political independence, not least the actions of employers who were members of the Liberal Party.

At Manningham Mills in Bradford, just before Christmas 1890, the Liberal employers imposed a 33% wage cut. The mainly unorganised female workers went on strike for nearly six months. The workers were starved back to work, and the strike was defeated, but the workers went on to form the Bradford Labour Union.

In the General Election in 1892, dockers’ leader Tillett stood for the Bradford Labour Union and came third on 30.2%, only 600 votes behind the winning Liberal candidate, a local mill owner!

That election saw nine independent workers’ candidates with three elected: Hardie in West Ham South, seamans’ leader Havelock Wilson in Middlesbrough and John Burns in Battersea – but all these candidates went into the election promoted by separate organisations.

The Independent Labour Party (ILP) was formed in January 1893, bringing together the Bradford Labour Union, Hardie’s Scottish Labour Party, trade unions and socialist organisations. Hardie was elected Chair.

Born from struggle

While not explicitly socialist, its platform included collective ownership of  production, distribution and exchange. However, according to Engels, the key significance was not whether it had socialism in its name but ‘that it had been born out of class struggle and was a political product of unionism’.

The 1891 TUC rejected Hardie’s proposal for a penny levy on every trade union member to fund workers’ candidates. It was defeated by 200 votes to 93. A year later, it was passed.

The 1893 and 1894 Congresses passed resolutions demanding unions only support candidates pledged to “the collective ownership of production, distribution, and exchange.”

Increased employer offensives and court rulings restricting union rights in the late 1890s led to the 1899 TUC motion for a special conference on workers’ political representation. The motion’s sponsors were the Amalgamated Society of Railway Servants, today’s RMT, and the National Union of Dock Labourers, today’s Unite. That conference established the Labour Representation Committee (LRC) in February 1900, uniting a coalition of trade unions, socialist societies, and cooperatives.

While the LRC’s leadership was initially dominated by reformist individuals who had not fully broken from the capitalist Liberal Party, its formation was nonetheless a significant step towards a class-conscious workers’ party.

Socialists’ role

The idea of an independent workers’ party had been championed for decades by socialist thinkers and activists. Engels had argued in 1881 that workers must stop being the Liberal Party’s “tail” and elect “men of their own order”. He explained that the working class needed to prepare itself for taking economic and political power for a democratically run society. Forming an independent workers’ party would be a crucial step in this preparation, allowing workers to use their collective power to advance their interests.

The LRC became the Labour Party in 1906, though you couldn’t actually join it as an individual member until 1918 – for its first 18 years until then, it was a coalition of trade unions and socialist societies.

That coalition was broad and included socialists, Marxists and reformists, such as those in the Fabian Society. However, it became an arena within which political arguments for socialism and the different policies and tactics to achieve it could be debated.

In the first election it contested, in October 1900, the LRC supported 15 worker candidates, four of whom were general secretaries of trade unions. Only Keir Hardie in Merthyr Tydfil and Richard Bell (general secretary of the rail workers) in Derby were elected.

A turning point in the struggle for independent working-class representation came when, the following year, the Taff Vale Railway Company successfully sued the rail workers’ union for alleged losses and damages during a strike. The House of Lords, then the highest court, held unions were liable for financial losses and damages caused by strikes. The union was ordered to pay £23,000 in damages plus costs. This decision made it nearly impossible for unions to strike without facing financial ruin.

The ruling galvanised the trade unions and led to increased support for the LRC, which was seen as the only viable vehicle for gaining parliamentary representation and defending workers’ rights.

At the 1903 LRC conference, there were 65 trade unions affiliated; by 1904, this number had risen to 127. The initial seven affiliated trade councils rose to 76.

The 1906 general election transformed a 74-seat Tory majority into a Liberal-Labour majority of 271, with 29 Labour MPs elected alongside 24 other trade union candidates elected as Liberals.

This parliamentary bloc of 29 independent workers’ MPs forced significant Liberal reforms, including the Trade Disputes Act overturning the Taff Vale judgement and granting unions immunity from legal action in trade disputes. Other reforms included old age pensions, health and unemployment insurance, and free school meals.

The Labour Party’s growing influence demonstrated the potential of independent working-class political representation – and while the reforms didn’t go as far as unions and socialists would have wanted, they were nevertheless significant. The worried Liberal leader David Lloyd George gave his reasoning for agreeing to social reforms: to prevent a “real cry” for a new party.

Lessons for today

The process of the formation of the Labour Party offers crucial lessons for today’s struggles for social and economic justice. Trade union victories, while possible, may be only sectoral and undoubtedly temporary in a capitalist system. Political change is necessary to consolidate general gains such as working hours, health and safety or social reforms such as pensions, health and education services. This consolidation needs an independent political voice for the working class, separate from capitalist parties.

Economic downturns and political struggles can act as catalysts for radicalisation and the development of class consciousness. The Great Depression and the Taff Vale judgment were both pivotal moments in the development of the Labour Party, demonstrating the potential for crises to spur working-class resistance.

The current economic crisis and the Labour Party’s rightward shift under Keir Starmer are creating conditions ripe for a renewed push towards independent working-class political representation. As in the late 19th century, the process will likely be complex and uneven. An absence of a working-class alternative leaves a political vacuum that right-wing forces such as Reform UK will seek to fill.

Again, the working class is presented with the historic task of building its own alternative, independent of the establishment parties. And while mass struggle will arise from current crises, creating conditions for such a party to emerge, the role of organised socialists is vital: to assist in speeding up the process, and to fight for a programme for the socialist transformation of society.

• Dave Nellist was Labour MP for Coventry South East from 1983 to 1992, and a Socialist Party councillor in Coventry from 1998-2012. Today he is the chair of the Trade Unionist and Socialist Coalition

Chartism and the struggle for male suffrage

The late 19th century witnessed significant social and political upheaval in Britain. The Industrial Revolution that began in the mid-18th century had created a vast working class without any political influence in Parliament.

The dominant parliamentary political parties – Conservatives and Liberals – represented different segments of the ruling class. The Tories spoke for the landowning interests, the Liberals for the rising capitalist class.

The division manifested in their policies. The Tories supported protectionism, particularly for the landowners and for agriculture; the Liberals advocated free trade to benefit the industrial capitalists. The Tories resisted electoral reform as the landed gentry and aristocracy they represented benefited from the existing system. The Liberals meanwhile supported extending the franchise to more men – though primarily as a strategy to prevent revolution from below.

The Chartist movement led the main nineteenth-century struggle for voting rights, though their aims extended beyond suffrage. They wanted political representatives who would fight for a 10-hour day, trade union rights and against the hated ‘Poor Law’ (that forced those in need into workhouses, which the Chartists called ‘prisons for the poor’).

The “People’s Charter” in 1838 had six key demands: the right to vote for all men over 21; equal-sized constituencies; secret ballots; annual parliamentary elections; removal of property qualifications for MPs; and payment for MPs to enable working-class representation.

These demands enjoyed massive popular support. Petitions with millions of signatures were submitted to Parliament in 1839 and 1842. However, the movement reached its zenith with the third petition in 1848, just as revolutionary movements swept across Europe and the same year that Marx and Engels published the Communist Manifesto.

Marxists look at the conditions that create such social movements as rooted in objective conditions, particularly economic ones. However, their success or failure depends heavily on subjective conditions – the quality of leadership, the strength of organisations, and the clarity of ideas that guide them. The Communist Manifesto sought to address those problems.

British capitalism’s global dominance was waning in the second half of the 19th century. In its heyday, substantial profits allowed for concessions on wages and working hours to maintain industrial peace. A layer of privileged trade union leaders, particularly among skilled workers, benefited more from defending the status quo than challenging it. Many union officials held membership in the Liberal Party, promoting an early version of “partnership politics” – the misleading notion that capital and labour have fundamental common interests.

Despite the waning of the Chartists, demands for voting rights wouldn’t go away. Tens of thousands were involved in demonstrations for the right to vote in the 1860s, which forced the Disraeli Tory Government in the 1867 Reform Act to make concessions in extending the vote to male workers who owned or rented property in the towns – fearing a growing mood that could echo the revolutions of 20 years earlier. Although that doubled the numbers with a vote, it still excluded women, agricultural workers, and many others from voting.

Liked this article? We need your support to improve our work. Please become a Patron! and support our work