Gangmasters (Licensing Authority) Regulations 2014

Duke of Montrose Excerpts

Wednesday 16th July 2014 Grand Committee

[Baroness Williams of Trafford (Con)]

My Lords, the regulations were laid before Parliament on 9 June 2014. They revoke and replace the Gangmasters (Licensing Authority) Regulations 2005 and reform the governance of the Gangmasters Licensing Authority (GLA) by reducing the size of the board from its current 29 members to nine members and enabling board members to be recruited through open competition rather than by nomination from a restricted set of organisations.

The GLA was set up in 2004 to protect vulnerable and exploited workers after the tragic deaths of 23 Chinese cockle pickers in Morecambe Bay. The authority licenses businesses which provide workers to the farming, food processing and shellfish-gathering sectors to make sure they meet the employment standards required by law, and carries out inspections and enforcement activity. Since 2004 the GLA has issued over 2,500 licences and initiated the successful prosecution of 70 individuals. Since 2010, the GLA has identified £1.2 million in proceeds of crime and protected over 5,000 workers, recovering some £4 million for victims. The GLA became a Home Office non-departmental public body on 9 April 2014, transferring from Defra.

The regulations before noble Lords today reflect one of the key recommendations of the Red Tape Challenge review of the GLA’s operations and implement a measure announced in a Written Ministerial Statement presented to Parliament in May 2012 by the noble Lord, Lord Taylor, when he was Parliamentary Under-Secretary of State at Defra. The planned reform of the board was a key recommendation of the triennial review of the GLA, which reported in April 2014.

When the GLA was established in 2004, the main concern underlying the design of its governance structures was to encourage a high level of participation from the widest possible cross-section of industry stakeholders in order to secure support for the introduction of the licensing regime. This resulted in a very large, representative board with places reserved—subject to ministerial appointment—to specific organisations named in statute, as well as a number of ex-officio places for government departments and agencies with operational interests in common with the GLA. This approach succeeded in helping the GLA establish itself as a well respected and effective regulator. However, it was recognised that the governance structures enshrined in the 2005 regulations were intended to serve the authority during its early years of operation, and that they should be reviewed to ensure that they continued to enable effective leadership.

The Red Tape Challenge review of the GLA concluded that its developing role in tackling worker exploitation and criminal activity demands more focused leadership, and the review recommended the introduction of a smaller board to provide the authority with clear strategic oversight and direction. Reforming the board in the way provided for in these regulations will enable the GLA to better adapt to the changing circumstances that it faces. Strong and effective engagement with the sectors that the GLA regulates remains important. This will be ensured through improved advisory groups reporting to the main board, building on the current system of sector liaison groups. I commend these regulations to the Committee.

[The Duke of Montrose (Con)]

My Lords, I greatly welcome the measure introduced by the Minister, particularly the reduction in the number of people involved in running this operation. This will presumably result in better value for money in what is produced by the Gangmasters Licensing Authority. However, considering that originally—and, probably, even now—the expenditure was supposed to be recovered from the applicants, will this mean that the cost of the licences will now reduce? I do not know whether the GLA was successful in that regard. It might well have had a shortfall but, as the Minister mentioned, it certainly issued a great many licences over the period.

Originally, the GLA appeared to have only one set fee in obtaining a licence, and I wonder whether the new body will be allowed to differentiate at all between large and small employers. This is a topic that I have followed on and off for some time, and one of the interesting things is the range of activities that the GLA covers. The Explanatory Memorandum states that the GLA issues licences to businesses supplying labour in connection with agriculture, and the gathering of wild animals and wild plants. The Minister mentioned this in her introduction, but it may not be immediately obvious to Members of the Committee that apparently the gathering of wild plants includes forestry, and therefore the whole forestry industry seems to be brought into the regulations.

The particular issue that I came across was that many of the people who come to work in forestry are single, individual contractors. For example, I came across a fencer. In fencing it is much better to have two people, but as an independent contractor he would ask someone to come along and cut branches off the trees along the path of the fence he was building. If that person, however, finished his work and stopped to pick up a hammer in order to help the fencer, a gangmaster’s licence would be needed. The distinguishing feature is that if you are in charge of equipment, you are not part of a gang. The minute you become involved in manual labour for someone else, a gangmaster’s licence is required. I should be grateful to know how this has progressed and whether there will be any discretion under the new body to tailor the way in which it applies the regulations.

--- Later in debate ---

[The Duke of Montrose]

My Lords, perhaps I might come in again. It was very interesting to listen to the noble Lords opposite and hear their concerns. I wonder if we have a clear picture of what the members of the Gangmasters Licensing Authority are required to do. Presumably they have a very great role in drawing up the regulations and looking into the particular circumstances of any industry. By and large, the regulations are fairly clear. The enforcement is laid on those who employ the gangmaster. At the same time, of course, the police and various other bodies can carry out the enforcement. I do not know whether the members of the Gangmasters Licensing Authority are asked to go round and check on what is happening in different circumstances. Particularly if there is a legal case that arises, I suppose that they are required to appear in court. I wonder on how many occasions the members of the Gangmasters Licensing Authority have been asked to appear in court to defend their regulation.

[Lord Young of Norwood Green]

There were two figures that the Minister quoted that I thought were interesting. I missed exactly whether the £1.2 million was the licence fee—I might have got that wrong but she can correct me if so. As interesting was the £4 million compensation that was obtained. I presume that was in circumstances where, for one reason or another, employment rights had been transgressed, whether it was minimum wage or whatever the circumstances were. It would be interesting to have some detail about what that compensation involved.