[Lynn Eades]

Barry is onto it.
It is part of the drain mechanism. It mounts to the floor beside the diff extention housing. The spindle is a couple of feet long and goes up top. it has another support at the rear plate inside the engine covers. The bit of the spindle you have is the bit at the bottom that connects to a round plate, that seals the hole through the floor.
I only know because this is the set up in my OP no1 Mk3w.
Lynn.