Modern Slavery Bill

Lord Alton of Liverpool Excerpts

Monday 1st December 2014 Lords Chamber

Moved by

[Lord Alton of Liverpool]

32: After Clause 7, insert the following new Clause—
“Proceeds of crime: MSV Fund
(1) The Secretary of State shall by regulations establish the Modern Slavery Victims’ Fund (“MSV Fund”) to receive and distribute the proceeds referred to under subsection (2) which have been recovered under a confiscation order, where that order is made in respect of a person who has been convicted of an offence under section 1, 2 or 4.
(2) The MSV Fund shall receive no less than 50 per cent of any money recovered under a confiscation order.
(3) Subject to subsection (4), the proceeds referred to under subsection (2) shall be distributed by the MSV Fund as follows—
(a) 50 per cent of the proceeds shall be distributed as compensation to the person or persons identified as victims of slavery or victims of human trafficking;(b) 25 per cent of the proceeds shall be distributed to the charities or other organisations listed in the regulations, which provide services, assistance, support and protection to victims of slavery and victims of human trafficking; and(c) 25 per cent of the proceeds shall be distributed to the organisations listed in the regulations, whose purpose is to prevent slavery, servitude and forced or compulsory labour or to help to investigate or prosecute people who commit offences under this Act.(4) For the purposes of any distribution under subsection (3)—
(a) for victims of slavery or victims of human trafficking under paragraph (a), the monies paid—(i) shall be distributed equally between those persons who have been directly identified as the victims of slavery or victims of human trafficking to whom the conviction referred to under subsection (1) relates; and(ii) shall not be reduced or diminished by reference to any other compensation that such person or persons may receive from other sources, (b) for the charities and organisations referred to in paragraphs (b) and (c), the monies paid shall be distributed equally between those charities and organisations.(5) The regulations referred to in subsection (1) shall provide rules determining the composition, management and financial accountability of the MSV Fund together with such other provisions that the Secretary of State may consider necessary for the exercise of its functions.
(6) The Secretary of State must appoint the Commissioner as a member of the management board of the MSV Fund.
(7) Before making any regulations under this section the Secretary of State shall consult such persons as he thinks fit.
(8) Regulations under this section shall not be made unless a draft of them has been laid before and approved by a resolution of each House of Parliament.
(9) In this section—
“the Assets Recovery Agency” means the Agency referred to in section 1 of the Proceeds of Crime Act 2002;
“the Commissioner” means the Independent Anti-slavery Commissioner appointed under section 40;
“confiscation order” means a confiscation order under section 6 of the Proceeds of Crime Act 2002.”

[Lord Alton of Liverpool]

My Lords, Amendment 32 stands in my name and that of my noble friends Lady Cox, of Queensbury, and Lord Hylton. I thank them for their support for the amendment. I also thank the Public Bill Office of your Lordships’ House, which gave me a lot of help with the drafting of the amendment. The purpose of the amendment is to give the Secretary of State power by regulation to,

“establish the Modern Slavery Victims’ Fund (“MSV Fund”) to receive and distribute the proceeds referred to under subsection (2) which have been recovered under a confiscation order, where that order is made in respect of a person who has been convicted of an offence under section 1, 2 or 4”.

If the amendment were to be incorporated in the legislation, it would enable the MSV fund to receive,

“no less than 50 per cent of any money recovered under a confiscation order. Subject to subsection (4), the proceeds referred to under subsection (2)”,

would then be distributed by the fund, with 50% of the proceeds given as compensation to victims, 25% distributed to the charities and other organisations listed in the regulations, and 25% distributed to the organisations whose purpose is to prevent slavery. I would have in mind, obviously, the police, but also others such as the Independent Anti-slavery Commissioner.

Modern slavery is very profitable. The International Labour Organization estimates annual profits from slavery to be around $150 billion a year. For example, a child trafficked and forced to pickpocket on the streets of London can, according to Anti-Slavery International, bring traffickers yields of £5,000 to £10,000 every month. Modern slavery is a high-profit, low-risk crime. Most of those involved escape justice and, even where there is a conviction, asset seizure is often considered too late in the process so the perpetrator has had a chance to move their assets elsewhere. Even where confiscation is made as part of the criminal proceedings, compensation is very rarely ordered.

The amendment would address this by bringing confiscation of assets and compensation to the very heart of the Bill and, in doing this, it would be similar to the United States anti-trafficking legislation. Confiscation has the effect of hitting the perpetrators where it hurts and its deterrent effect is potentially more significant than the threat of a long prison sentence, which can easily be avoided by entering a plea bargain. As the average prison sentence for modern slavery offences has been relatively low— around five and a half years—unless the perpetrator is stripped of their assets they can come out of prison and enjoy a luxurious life, while victims continue to suffer.

Restorative justice is also a function of compensation for victims and is the key to this amendment. By awarding damages to the victim, their suffering is acknowledged in a way that convicting the perpetrator rarely achieves. Victims who act as witnesses are of course often re-traumatized in the process. Furthermore, compensation gives victims stability and a chance to rebuild their lives. For example, one victim who was compensated has invested the compensation to pay for university education and is now pursuing a law degree.

I first raised the possibility of using confiscated assets to help victims and deter traffickers in 2002, during the passage of the Proceeds of Crime Bill. I argued that there were simply insufficient resources to adequately address a crime which, too often, was out of sight and out of mind. Yet even then, the United Nations had identified people trafficking as the fastest growing facet of organised crime and the third largest source of profit for organised crime, after the trafficking of drugs and firearms. At the time, the Government admitted:

“At present there is no specific offence of trafficking in human beings and so no data exist about the confiscation of assets of those engaged in this practice”.—[Official Report, 18/6/02; col. WA 70.]

My 2002 amendment called for the proceeds of trafficking to be channelled into the support of victims and the resourcing of a strategy to tackle this scourge at source. Supporting the amendments then and the use of confiscated assets to hit the traffickers where it hurts, the late Lord Wilberforce, a Law Lord and a descendant of William Wilberforce, described trafficking as,

“a pervasive crime committed in all kinds of areas by all kinds of people. It must be dealt with by a great variety of authorities”—

I repeat, a great variety of authorities—

“and police forces all over the country, many of which have no idea of the nature of the crime or the remedies available to deal with it”.—[Official Report, 25/6/02; col. 1225.]

Since 2002, the Government have been persuaded to develop the principle of confiscating assets which have been accumulated through the pursuit of crime. I strongly welcome this but it would help this debate if the Minister could describe what has been the experience of the Proceeds of Crime Act to date. It has been suggested that there may already be as much as £2 billion in uncollected POCA fines, so whether or not there is a dedicated dispersal fund, as the amendment would require, it would be helpful to know how the Government intend to improve the collection rate and what their estimate is of the sums currently outstanding.

Addressing Pope Francis at a Vatican conference on human trafficking held in April this year in Rome the Home Secretary, the right honourable Theresa May MP, said:

“Our efforts must also focus on going after the profits of those involved, and compensating victims with seized assets”.

The Bill itself recognises that the first call on seized assets should be to provide reparation to the victims of the modern slavery offence. Where there are seized funds left over, the Government say that they will benefit criminal justice agencies through the existing asset recovery incentivisation scheme. ARIS has the objective of providing all operational partners who use the asset recovery powers in the Proceeds of Crime Act 2002 with incentives to pursue asset recovery as a contribution to the overall objective of reducing crime and delivering justice. It is not, however, specifically targeted at tackling human trafficking and modern slavery. However, that scheme is not on a statutory footing, although some of the moneys distributed under ARIS are used to fund improvements in asset recovery capabilities and on community projects, and I welcome that. This amendment would create a statutory scheme.

Around £80 million was returned to operational partners from ARIS in 2013-14. The Minister might like to say how much of that money is used specifically to deter and bring to justice the perpetrators of modern slavery. I would also be grateful if he would quantify what he believes will be necessary to fund this ambitious legislation, otherwise it risks becoming yet another declamatory law which sounds good but can make little difference. Will he say how much money will be set aside to support this legislation? We all recall the Climate Change Act 2008, which imposed what was called a “legally binding obligation” for reduction of 80% of greenhouse gas by 2050. It was never made clear how it was to be done, who was to be held to account if this target was not realised and what punishments there would be.

The Child Poverty Act 2010 was not much better, requiring the elimination of child poverty by 2020. If the Bill is not to be added to the list of declamatory legislation which has inadequate resources attached to it to ensure its enforcement, we need to insist on ways of providing adequate resources. Although the Minister says that the Government are unconvinced about the need to ring-fence these assets for this dedicated use, he has indicated his willingness to discuss the amendment and said, in a letter to me:

“There is a great deal of common ground between us on the principles of how seized assets should be used, in terms of using the funds raised to compensate victims and support law enforcement agencies”.

I welcome that greatly.

The Government tend to suggest that the police is the agency which needs to be funded to bring perpetrators to justice. Of course, there is a lot in that argument. However, as the late Lord Wilberforce recognised, a great variety of authorities need to be involved and many, along with the police, are completely underresourced. At Second Reading, I highlighted the position of the Gangmasters Licensing Authority, established in 2006 in the aftermath of the tragic death of 23 Chinese cockle-pickers who died in Morecambe Bay, part of a criminal racket exploiting workers all over England, and estimated to funnel £1 million per day back to China.

In 2013, Professor Gary Craig of Durham University, working with the Wilberforce Institute for the study of Slavery and Emancipation and the Joseph Rowntree Foundation, published Forced Labour in the United Kingdom, a report which specifically said that the GLA was insufficiently resourced. The report found that:

“The scope of the GLA should be extended to cover all sectors using labour providers and greater resources should be available for the GLA to be able to fulfil its role effectively”.

The three-year study draws on data from legal, policy and regulatory bodies and calls for the Government to reconsider some key policies and take a broader view of the problem. The report also found that:

“Monitoring for severe labour exploitation is generally weak and needs to be strengthened”.

Professor Craig, who is professor of community development and social justice, says that workplace enforcement agencies are now doing fewer inspections, becoming focused on only the most serious offences rather than tackling all types of serious labour exploitation. Commenting on the scale of the problem he says:

“Criminal activity of this nature is difficult to monitor, but conservative estimates are that there are currently at least several thousand cases of forced labour in the UK and 880,000 across the European Union”,

and that those trafficked for labour exploitation would soon exceed those trafficked for sexual exploitation.

I turn to the need for public education, something which many noble Lords have raised today and which the Government acknowledge the need for. No one has said how that would be resourced. Professor Craig remarks that there is a “real problem” getting people to acknowledge not only that slavery exists in the UK, but that, as his research suggests, there may be upwards of 10,000 people at any one time in conditions which we would class as modern slavery. I noticed over the weekend that the BBC added another 3,000 to that number.

In addition to recommending the extension of the mandate of the GLA, providing powers of arrest and investigation, Professor Craig argues that the GLA should be able to keep fines to fund its work, adding that the resources directed to the GLA are totally inadequate. If the dedicated fund specified in the amendment were created, it could be used to extend the mandate and work of the GLA and other agencies involved in this most serious of crimes. The Independent Anti-slavery Commissioner, Kevin Hyland, has also said in an interview in the Sunday Times that the resources needed should be raised as a result of using the confiscated assets of funds that have been seized.

--- Later in debate ---

[Baroness Butler-Sloss]

Before the noble Lord sits down, I do not want to waste time, and I understand the point that the Minister is making about not alerting a potential trafficker so that he might skip the country, but what you can do, for instance, is get a without notice order in the civil court to freeze the assets and then arrest immediately afterwards. You do not have to alert the trafficker in order to freeze the assets. However, I am not sure that the powers for freezing assets would include people who are traffickers. That is the point that I want to put to the Minister.

[Lord Alton of Liverpool]

Before the Minister sits down, is he going to reply to my noble and learned friend first, or may I also put a point to him?

[Lord Bates]

I think that I am probably going to have to reflect on that point and come back to the noble and learned Baroness in writing, certainly before Report.

[Lord Alton of Liverpool]

I am grateful to the Minister. As a young Member of another place, I was once given the quite good advice always to beware Ministers when they are promising reviews, but in this case the Minister has said that the review is already under way. I am very grateful to him for saying that. He says that it is going to report in December. Will that be in time for us to be able to come back on Report acting on the outcome of the review? What is his estimate of the timetable?

[Lord Bates]

In the matter of the timetable and in many other matters I am grateful to have the Chief Whip, my noble friend Lord Taylor, on the Bench beside me. He has signalled his assent to the suggestion that this may be something where the report will be published, in all likelihood, before Report. Therefore, there will be an opportunity to revisit it then.

I should also say, as I have found the note, that the current distribution of the scheme provides that 50% of the proceeds go to the Home Office; 18.75% to investigation agencies; 18.75% to prosecution agencies; and 12.5% to HM Courts and Tribunal Service, which enforces the orders. That is the current distribution. I hope that is helpful.

[Lord Alton of Liverpool]

The noble Lord has been incredibly helpful to the Committee. It is very late and I do not intend to detain the Committee for long now. I simply want to thank my noble and learned friend, and thank the noble Lord, Lord Warner, for putting his argument so effectively. He is right that we have to generate the funds in the first place to provide the pots in order to do the things that the noble Baroness, Lady Hamwee, and my noble friend Lord Hylton all recognise need to be done. Indeed, the Minister himself has recognised that the principle behind this is not a bad one and is worth looking at further. He has engaged with the arguments in his usual courteous and characteristically helpful way. I am extremely grateful to him at this stage. We will see what the review holds and will keep open the possibility of coming back on Report if his noble friend is able to timetable events to ensure that the chronology works out that way. Having said that, I beg leave to withdraw the amendment standing in my name.

Amendment 32 withdrawn.