Union boss Len McCluskey took private jet flights arranged by building firm, report finds | UK News

Former Unite boss Len McCluskey enjoyed private jet flights and football tickets arranged by the firm building a multi-million pound hotel for the union, according to an internal report seen by the .

Flanagan Group, which is run by friends of Mr McCluskey, overcharged Unite by at least £30m for the Birmingham hotel and conference centre project, the Unite report says.

It also found Mr McCluskey “overruled” advice from staff and the union’s lawyers in signing the construction contract with Flanagan Group.

Unite’s report said the private jet flights and football tickets were “consistently organised and paid for by” the Flanagan Group and there is “no indication” Mr McCluskey later reimbursed them.

Mr McCluskey’s lawyers told the he paid for his own travel in full, and, to his recollection, always paid the cost of his football tickets.

He denied he had overruled staff or lawyers. The Flanagan Group did not respond to repeated requests for comment.

Before he retired in 2021, Mr McCluskey was one of the most powerful figures in the trade union movement and a leading backer of Jeremy Corbyn, during his time as Labour leader. He remains an influential figure on the left of British politics.

He was an enthusiastic supporter of the Unite hotel project, which was meant to be a financial investment for the union’s members, as well as a venue for its meetings.

But it ran massively over budget and has been mired in controversy, with the Serious Fraud Office last year launching an investigation into it.

When Sharon Graham took over from Mr McCluskey as Unite’s general secretary, she launched a series of internal inquiries after discovering apparent discrepancies in the union’s accounts.

Unite’s auditors found the union spent as much as £125m on the hotel and conference centre development, which has since been valued at just £38m.

“I was absolutely astounded,” Ms Graham told the .

“I could feel the pit of my stomach drop, thinking what has gone on here?

“There’s no way to pretend that actually it was a whoopsie-daisy moment… It’s either rank incompetence, or it’s something else.”

Ms Graham commissioned a specialist construction lawyer, Martin Bowdery KC, to investigate the project’s costs and accounts.

The has seen a summary of Bowdery’s report, which has been presented to the union’s executive council.

The report says:

• The union spent “at least” £72m more than the hotel complex is worth
• Unite awarded Flanagan Group the contract to build the hotel with “no competitive tendering process” and despite the firm “having a history of poor performance, delays… and cost overruns on previous contracts”
• Mr McCluskey described the firm’s bosses as “good friends”

Mr McCluskey’s lawyers said he was unaware of the concerns of staff or union lawyers at the time the construction contract was signed, does not recall signing the principal contract, and was not involved in the decision to select Flanagan Group.

His lawyers have said he categorically rejects any suggestion of improper dealings.

The Flanagan Group did not respond to repeated requests for comment but has previously told the it was “proud” of its work on the scheme and costs had risen due to “radical changes to design and working practices”.

Mr McCluskey received private jet flights to watch the team he supports, Liverpool FC, play in the 2018 and 2019 Champions League finals in Kyiv and Madrid, according to Unite’s report.

Sources have told the that on one occasion he travelled on a Falcon 900B business jet.

The plane’s owners said it offered passengers “super size comfort” including “8 leather club seats, a full size bed, fully stocked galley and cabin sound system”.

Aviation company Global Charter has estimated the return trip would have cost between £40,000 and £47,500.

Unite’s report also claims that Mr McCluskey received tickets for five Liverpool FC games in the UK, four of which included matchday hospitality.

It said “the evidence for this comes from tickets and flight information sent to Len McCluskey’s Unite email”.

Mr McCluskey’s lawyers said he paid for his travel in full and recalled travelling with a commercial carrier on one of the flights.

They said he occasionally attended football matches with the Flanagans but invariably paid his way and does not believe he even attended all of the domestic matches as claimed by Unite’s report.

There is no suggestion Mr McCluskey breached Unite’s gifts or hospitality rules because there was no such policy. Sharon Graham has since introduced a gifts and hospitality policy.

She has also recruited a new finance director and procurement officials as part of what she calls her “clean up” effort.

“Maybe it took a woman to do it”, she said. “And now I’ve uncovered it, I’m going to make sure that it never happens again.”

Ms Graham is also attempting to get back some of the millions spent on the hotel. “Because this is members’ money, I expect it back in the union”, she said. “And I’m going to do everything in my power to make sure that happens.”

Initial estimates for the hotel project in 2012 suggested it would cost around £7m.

But the scale of the union’s ambitions grew under Mr McCluskey’s time as general secretary, from 2011 to 2021, and the construction bill ballooned.

In the end, Flanagan Group was paid a total of £96m for its work on the four star hotel and conference centre, which opened for business in 2021.

In his report, Bowdery said £30m of that was overcharging and the company submitted bills “massively over the original estimates”.

In one instance it is claimed the company billed £1.3m for work which should have cost £90,000.

The Flanagan Group was also paid £3.7m for adverse weather delays even though the company was “not entitled to extra payments for adverse weather,” the report states.

The company has not responded to requests for comment, but it has previously said: “We would like to make it clear that this scheme was delivered fairly and should be regarded as an exceptional asset for the union.”

Len McCluskey and Flanagan Group have previously said cost overruns were partly due to the hotel project using unionised labour.

The construction industry is known for using freelance workers who are not directly employed and not represented by trades unions.

But the Bowdery report said: “There is no actual financial evidence of any cost increase caused by this.”

It added that it was not clear Flanagans complied with Unite’s union labour contracting requirements and “refused to provide information to confirm union labour” was used.

Emails forwarded or copied to Mr McCluskey in 2017 said the “vast majority of the workforce” were not on union agreements.

Mr McCluskey’s lawyers said he did not remember the emails but any credible suggestion of non-unionised labour would have been duly addressed.

The report said it was “remarkable” there was no documentation showing who decided to appoint Flanagans.

It also states that Mr McCluskey told the inquiry that the decision had been made by Unite’s former finance director Ed Sabisky.

This contradicts evidence to the inquiry from a Unite official who said Sabisky was “100% against” engaging Flanagan Group but that he was overruled by Mr McCluskey.

Ed Sabisky died in March 2020 after suffering a stroke so the is unable to verify this account.

The Bowdery report said Mr McCluskey signed the main hotel contract. His lawyers told the he does not recall signing it.