* ANC supports Manuel as head of policy unit

* Favours "neutral" experts to develop policy

* ANC says it can convince partners to accept Manuel (Adds analyst comment, paragraph 9-10)

By Peroshni Govender

JOHANNESBURG, Nov 9, (Reuters) - South Africa's ruling ANC has backed Trevor Manuel's leadership of the government's national policy planning commission, dealing a blow to the party's trade union allies who want the former finance minister sidelined.

Labour federation COSATU wants Economic Development Minister Ebrahim Patel, a former trade unionist, to be responsible for policy direction as it seeks to push the country towards a leftist economic stance.

It says planning minister Manuel is too close to business and that a team of cabinet ministers should lead the National Planning Commission (NPC) -- formed in May but yet to start work -- tasked by President Jacob Zuma with guiding policy.

Patel's inclusion in the cabinet's economic cluster last month over Manuel sparked concern that Manuel was being sidelined and his influence in decision-making was waning. But Monday's endorsement from the African National Congress shows that he should remain a key policy maker.

ANC Secretary-General Gwede Mantashe said the party's top leaders at the weekend agreed that a commission consisting of experts that Manuel would oversee was the best way to develop "neutral" government strategies.