David Cameron and Ed Miliband clash over funding

Ed Miliband asked if a hedge fund tax cut was a coincidence

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David Cameron and Ed Miliband clashed over party funding and Labour's links to the unions at a stormy Prime Minister's Questions.

Struggling to be heard above the roars of MPs on both sides, Mr Cameron told the Labour leader the unions "own you, lock stock and block vote".

Mr Miliband hit back by saying the PM was "owned by a few millionaires at the top of society".

His call for a cap on political donations was rejected by the PM.

The pair battled to wrongfoot each for more than 10 minutes in a session that was frequently halted by Speaker John Bercow, attempting to keep MPs in order.

Rough ride

Mr Miliband ignored the PM's offer to legislate to introduce the Labour leader's proposals to allow union members to actively "opt in" to party membership, set out on Tuesday in his response to allegations of union vote rigging in Falkirk.

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Instead of reform then, we are likely to see a repeat of the sound and fury at today's PMQs ”

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But Mr Cameron rejected the Labour leader's call for a £5,000 cap on political donations, telling MPs Labour's row with the union Unite over selection for the constituency of Falkirk should not mean taxpayers funding the main three parties.

In November 2011 the Committee of Standards in Public Life, chaired at the time by Sir Christopher Kelly, proposed a cap on individual donations of £10,000 but proposed that taxpayers should subsidise political parties for each vote they got.

Last week, before the latest developments in the Falkirk row, it was announced that cross-party talks on the proposals had collapsed.

Mr Cameron also appeared to reject a demand from Labour to restrict MPs taking second jobs. He said it was important MPs remained open and transparent about any work outside Parliament.

Mr Miliband was given a rough ride over the Falkirk allegations at last week's Prime Minister's Questions but he went on the attack this week, pointing out that the Conservative Party had received £24m in donations from hedge funds.

He said it was no coincidence hedge funds got a £145m tax cut in this year's budget.

Mr Cameron said there was a "big difference" between donations to the Tories and to Labour, claiming Labour donations directly bought influence.

'Stitching up'

He told MPs: "Here are the figures - £8m from Unite, £4m from GMB, £4m from Unison. They have bought the policies, they have bought the candidates and they have bought the leader."

Mr Miliband hit back, telling the PM: "I will tell you what the difference is - 6p a week in affiliation fees from ordinary people up and down the country against a party funded by a few millionaires at the top.

"What is shameful about it is that you don't even know about the extra tax cut you gave to hedge funds."

Mr Cameron, as is customary at PMQs, had the final word, telling Mr Miliband: "What is interesting is that you don't want to talk about the trade union stitching up parliamentary selection. That is what this scandal is about.

"Let's ask what has changed since yesterday. Will the unions still have the biggest vote at the conference? Yes. Will they still be able to determine the party's policy? Yes. Will they still have the decisive vote in voting for the Labour leader? Yes. That is the fact. They own you lock, stock and block vote."

Mr Miliband's proposals have received a mixed reaction from unions. Unite boss Len McCluskey, who has locked horns with Mr Miliband over the Falkirk row in recent days, praised his "bold, brave speech". But he said he would wait to see the details on the political levy.

Paul Kenny, leader of the GMB union, said the proposal could "end rather than mend" relations and could cost the party more than £1m a year from his union. Gerry Morrissey, general secretary of Bectu, another Labour-affiliated union, said the proposal was "totally unnecessary".

Unite says it did sign up members to Labour in Falkirk - something that was allowed - but denies doing so without their knowledge.

Mr McCluskey has described the Labour investigation into events as a "stitch-up" designed to smear his union. Labour has suspended the selection process in Falkirk and passed its report into events to the police.

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