Modern Slavery Bill

Baroness Mobarik Excerpts

Wednesday 10th December 2014 Lords Chamber

[Baroness Kennedy of Cradley]

My Lords, I support Amendment 98, which was moved by the noble Lord, Lord Alton of Liverpool.

The case for legislating for transparency in supply chains as part of the Bill has been well made and it is very welcome that it is being progressed by the Government through Clause 51. Now, as many noble Lords have said, the task is to get the detail of the legislation right and agree between us a well crafted clause that levels the playing field for business, informs investors, shareholders and consumers and drives change to end slavery in supply chains. I support Amendment 98 because it would do exactly that.

Amendment 98 would rewrite Clause 51 by adding, where necessary, elements of detail to ensure that it is more meaningful, effective and workable. As the noble Lord, Lord Alton, said, in line with the California Transparency in Supply Chains Act, which came into force in 2012, the amendment defines the threshold as not less than £60 million and, most importantly, includes the term “group undertaking” when determining the total turnover. That is important because it allows multinational companies that may have small operations in the UK to be covered by this legislation.

We all want the Bill to have global reach. Therefore, having a way to ensure the inclusion of all large foreign companies that provide services to the UK is vital. Clause 51 is ill defined in parts and Amendment 98 seeks to correct that in a number of ways. First, it suggests a simple change in the language to make the intent of the clause explicit. In the Modern Slavery Strategy the Government make it clear that they want this legislation to ensure that businesses investigate and report on modern-day slavery through the annual statements they are required to produce. It is therefore important that that aim is made explicit in the Bill. Subsection (4)(a) is consequently amended to confirm that the statement is specifically to “identify and address” the issue of slavery and human trafficking. It is its primary aim.

It is also important that the remit of this statement is more tightly defined. The clearer this legislation is, the better for business and consumers alike. Subsection (5) of Amendment 98 provides a framework for the statements. It makes sure that minimum disclosure measures are included in the Bill: the need for risk assessments; the need to set out who has been involved in identifying the risks; what actions have been taken to mitigate the risks; and what has been the impact of those actions. The “how” should be left to guidance. Without those minimum criteria, as other noble Lords have said, comparisons between companies will be impossible to make and the level playing field desired by good businesses will be difficult to achieve.

We also need to look to and learn from the Californian Act and not repeat its mistakes. The learning from the application of the California legislation to date also shows us why it is necessary to be clear in the legislation about what you want to achieve and what you expect business to report. In California hundreds of organisations have issued statements in line with the Act, but there is a wide variation in the information provided in those statements. Some have disclosed meaningless information, some have disclosed misleading information, and a few—perhaps worst of all—have thwarted the legislation and disclosed that they do nothing and are indifferent to the issue of slavery in their supply chains. For example, Caterpillar Incorporated, a multinational company reported to hold $89 billion in assets, which manufactures its products and components in 110 factories worldwide in high-risk countries such as India and Indonesia, issued a woefully inadequate statement. Krispy Kreme Doughnuts issued a statement of just 182 words, using them to say that as regards slavery it does not verify product supply chains, conduct audits of suppliers or require direct suppliers to certify materials.

Getting businesses to produce statements of that kind is not what this part of the Bill is about, and I do not believe it is what the Government intended it to be about. Clause 51 is not a paper exercise for businesses to write down in 200 words or less that they do not do any of this kind of work and do not intend to start. It is a serious measure that we need businesses to engage in and which good businesses want to engage positively with, properly and on an equal footing with each other. It is not fair that the good businesses that do excellent work, actively searching for evidence of exploitation, are being undercut and undermined. That is why having minimum criteria in the Bill is vital. Setting out those minimum criteria would not make the task more burdensome for business; the task—the production of the statement—remains the same. Minimum measures just give a framework for the task so that a level playing field between businesses is achieved.

Proper monitoring is also vital and, as the noble and learned Baroness, Lady Butler-Sloss, said, it is not currently clear how this part of the Bill will be properly monitored and enforced. Amendment 98 seeks to address that, too. Again, if we look to learn from the experience of the Californian Act, here some companies have ignored the Act completely. Research in January of this year quoted 85 companies as ignoring the legislation. That level of disregard is unacceptable, and we should make sure it is not replicated in the UK. Amendment 98 also ensures that a named government department receives and makes sure that the statements are easily publically available. It ensures that there will be consequences for blatant flouting of the legislation—as we have seen in California—by companies that do not comply or refuse to comply. Most importantly, it makes sure that compliance with this clause is a corporate responsibility. You need leadership from the top to change attitudes and make things happen.

I also very much support the requirement for a review after three years, which is included in Amendment 98. This part of the Bill in particular, as it is a completely new area of work, would benefit from a re-evaluation over a specified time period. Formally being able to hear the views of businesses, NGOs, trade unions and consumers on how this legislation operates in practice, and committing to bring forward changes where needed, would be a positive step forward.

I hope that the Government can accept much—if not all—of what is included in Amendment 98 and that they will look seriously at Amendment 98A in the name of my noble friend Lady McDonagh. She has clearly set out the impact multinational corporations can have in the fight against slavery. The 124 companies to which she referred, which operate in high-risk sectors and which have a combined turnover of approximately $1 trillion, can clearly influence the working conditions in tens of thousands of workplaces and help many millions of workers across the world. The power of this small group of companies is huge. They have the power to reform their business models, insist on inspection regimes, support local efforts to empower workers and insist on decent wages and formal contracts for all workers here in the UK and across the world. Her amendment brings home to us that we cannot rid the world of slavery without the help of big business.

The provisions in my noble friend’s amendment would enable the economic strength of these companies to be a force for good—something they want to be and something we desperately need them to be. Many if not all those companies understand the reputational damage and loss of both consumer confidence and market share they will suffer if they are found to be sourcing from suppliers which use exploitative labour. Most companies want supply chains that reflect their brand, not brands that reflect their supply chains, so I am sure that, like Amendment 98, this amendment will not be seen as a burden but an advantage. I hope that both amendments and what they set out can be accepted by the Government.

[Baroness Mobarik (Con)]

My Lords, I support the amendment in the name of the noble Lord, Lord Alton, and I am grateful to him for tabling it.

I have put my name to this amendment because it would do two important things. First, it will give businesses more certainty and clarity when producing the slavery and human trafficking statements required of them. That clarity is vital in saving businesses time. Secondly, however, it would also provide consumers with the information they need to hold businesses to account. Without the clarity that the amendment would provide, I am concerned that stakeholders, investors and campaigners will not be able to play their part effectively in helping stamp out the abhorrent practices that exist in some of our supply chains.

The media have done an excellent job in highlighting just how far slavery and forced labour have penetrated the supply chains for many of the goods and services that we take for granted, from basic foodstuffs to electronic goods, clothing and fashion. But modern slavery exists across the globe, and whichever form it takes, business supply chains are involved in some way or another. Slavery in supply chains is closer than we often realise. A couple of weeks ago, the owner of a bed factory in West Yorkshire that supplied retail chains such as Next and John Lewis was charged with human trafficking and slavery offences.

Modern Slavery Bill

Baroness Mobarik Excerpts

Monday 17th November 2014 Lords Chamber

[Baroness Mobarik (Con) (Maiden Speech)]

My Lords, when I was first given news of my appointment to your Lordships’ House, I must admit I was astounded, and, on my introduction, most honoured and flattered to be in your Lordships’ distinguished and learned company. In the few weeks that I have been here, I have found this to be a truly enlightened place, where civility and kindness predominate throughout—from the attentive Doorkeepers and helpful security guards to the courteous catering staff. At my every wrong turn in the many corridors of your Lordships’ House, there has been someone to offer assistance, and always with a welcoming smile and warm words.

I feel truly blessed by this and because I have been introduced to the House by my esteemed and noble friend Lord Strathclyde, having had the honour of serving on his commission on further devolution in Scotland on behalf of the Conservative Party, and the esteemed and noble Lord, Lord Smith of Kelvin, whom I have known for many years. Our paths crossed in the business world in Scotland, most recently in meetings in his capacity as chairman of Glasgow 2014 and the Commonwealth Games, and mine as chair of CBI Scotland. I also offer my gratitude for the guidance offered to me on entering the House by my noble friend Lord Younger of Leckie.

Having been asked by some as to what brought me here, I can only say that it is as a result of a series of rather random activities in my life, including some attempt at academia, as well as involvement with business, voluntary roles and charitable causes. Certainly there was no master plan, only a desire to engage and play a part in the wider world, which I hope that this new chapter in life will further allow me to do. Indeed, my 89 year-old father, someone in possession of one of the strongest personalities I have come across, now believes me to be finally qualified to write the occasional letter for him. I feel that I have finally arrived.

When taking stock of life on an occasion such as this, it is important to remember one’s elders and forefathers. My father and late mother were unique individuals, who gave much of their time and wealth to serving their community and to charitable causes. My father, having served in the British Indian Army during the Second World War, went on to establish a successful business in Pakistan, post-partition. In 1958, he ventured out of his homeland with the intention of exploring business possibilities in Canada, but stopped off in Scotland having heard much about its natural beauty from a British officer whom he had befriended during his Army years. The rest is history. He stayed in Scotland where he established several more successful businesses. However, that was only part of his achievement.

As I have already declared, both of my parents had a great belief in serving their community and in helping others who were less privileged—something which I, too, believe in and aspire to. Hence I choose this debate on the Modern Slavery Bill to make my maiden speech—not because I have significant expertise in the subject but because, for me, there can be no better reason to serve in this House than to speak for those who have been denied a voice.

There are many issues in the world today which are of great concern and need our attention: war and conflict, poverty and disease, food, energy and water scarcity, lack of education and healthcare, and the plight of persecuted minorities of all ethnicities and religions around the globe. Here in our country and in my city of Glasgow, there are those who feel disfranchised, struggle to make ends meet or are in a downward spiral of drink and drugs. All those social issues need our attention, and many are surely interconnected, but slavery in all of its insidious manifestations—human trafficking, bonded labour, domestic servitude—is such a direct attack on the human spirit.

I am conscious that while I sit in this glorious Chamber in comfort to contemplate and debate among your Lordships, countless others live in squalor and fear. While I am able to walk freely among nature and appreciate God’s bounty, for others there is only endless toil. It is estimated that 21 million people—according to some sources, as many as 30 million—are in some form of slavery today. Just a short distance from here in Westminster Abbey lies William Wilberforce who, with others, took up the cause of the abolition of the slave trade in the 19th century, which eventually led to the Slavery Abolition Act 1833. It is indeed disturbing to think that in 2014 we still face this moral outrage.

The Prime Minister has committed that Britain must once again lead the way in tackling slavery globally. Today we have the Second Reading of the Modern Slavery Bill, and I welcome the Government’s introduction on Report in another place of measures to address the issue of transparency in business supply chains, building on the pre-legislative scrutiny committee and recommendations of the evidence review. It is heartening to know that there was a clear and strong cross-party consensus in this regard, with certain reporting requirements to be included in the Bill.

Although it is important that we do not place undue burden on business, it is the moral duty of business to take positive action to eliminate this practice. No legitimate business would wish to tolerate any element of forced labour in its supply chain, and it is right that the Government legislate and provide the tools for business to audit effectively. Clearly, the financial gain which is derived by illicit and unethical practice is what drives bonded and forced labour and ultimately distorts markets. As a small business owner and a member of the council of CBI Scotland for many years, I can say that my colleagues, many representing big business, were highly principled, cared about social issues and would wish always to act ethically.

I have always believed that business has a very significant part to play in delivering prosperity for all and can be a great force for good. As the Institute for Human Rights and Business stated,

“as part of their responsibility to respect human rights, companies must be prepared to ensure the safety and dignity of all those who make their products or provide services”.

The Centre for Social Justice set up by my right honourable friend in the other place, Iain Duncan Smith, and its slavery working group report has exposed some of the shocking circumstances of those who are trapped in slavery. It has made recommendations for a fresh approach to tackle it, including equipping those on the front line to recognise modern slavery and act, offering compassion and support to rebuild those whose lives are affected and ensuring the part that business has to play in effecting transparency in its global supply chains.

The press has highlighted the issue of slavery in the shrimp trade in Thailand and the global garment supply chain, which directly impacts on our retail sector, but slavery does not only happen elsewhere; it exists here in the UK. The UK Human Trafficking Centre has evidence of forced labour in industries such as agriculture, food processing, construction and tarmacking, where vulnerable people are exploited by unscrupulous gangs and individuals.

It is not an exaggeration to say that modern day slavery is one of the humanitarian catastrophes of our age and I, for one, hope to be fully engaged in following the Bill through its passage in Parliament, so that we can put in place legislation which will help to eradicate this scourge from our midst.