Slavery

Lord Rosser Excerpts

Thursday 30th October 2014 Lords Chamber

[Lord Rosser (Lab)]

My Lords, I join the procession and extend my congratulations to my noble friend Lady Kennedy of Cradley on securing this debate on an issue of real concern affecting the lives of many millions of vulnerable people and involving the approach to corporate responsibility and corporate accountability, both nationally and internationally.

As has been said, the Government announced earlier this month that a measure to address modern slavery in the supply chain would be included in the Modern Slavery Bill. Surprisingly, it had been omitted when the Bill was first published, even though the legislation cannot be complete or fully effective without addressing the supply chain question. The Bill is due to receive its Second Reading in this House on 17 November. According to the Government, the new measure will require big businesses to state publicly each year what action they have taken to ensure that their supply chains are slavery-free, and will apply regardless of the nature of the company or what it supplies, whether goods or services. Perhaps the Minister could say in what form and where this disclosure will be required to be given each year, and confirm who in a company would be deemed to be responsible and accountable for its content—that point has been raised already.

The Government have also said that a consultation will be held to set the exact threshold for the size of the business to be covered, and that statutory guidance will be produced setting out the kind of information that might be disclosed to help companies comply. Perhaps the Minister could say whether the Government will be making available a list of companies that would be required to report each year under the terms of the new measure they have announced, and how easy or otherwise the Government intend to make it for interested parties and individuals to obtain details of the information disclosed, in the light of their commitment to deliver greater transparency to enable customers, campaigners and shareholders to hold all big business to account.

A recent report that has clearly had an impact with its findings is one from the Salvation Army containing data gathered during the third year of its contract with the Government for managing the delivery of specialist support services to adult victims of human trafficking identified in England and Wales. The report indicates that more than 1,800 people were supported by the Salvation Army and its partners between July 2011 and June 2014. In the third year, there was a 62% increase on the number of people supported in the second year of the contract, and a 135% increase on the number of those supported in the first year. Most people referred to the Salvation Army had been subjected to labour exploitation; the number of people recovering from labour exploitation has overtaken those being supported after sexual exploitation, with the growth being at a faster rate for the first time.

Forced labour and slavery are big business. As my noble friend Lady Kennedy of Cradley said—and others have also mentioned it—the International Labour Organization estimates the illicit profit at $150 billion a year. Perhaps not surprisingly, where big money and big profits can be made, voluntary measures have proved inadequate for tackling the scale of modern slavery in our supply chains, and avoiding a race to the bottom in labour standards and respect for human rights.

More specifically, we have heard about cheap clothing being produced in Bangladesh through forced labour or servitude, and read the reports in the Guardian newspaper recently about the issue of the prawn fishermen. We have also been reminded in our debate today by the right reverend Prelate the Bishop of Derby and by the noble Baroness, Lady Cox, that exploitation of vulnerable people occurs in our own country as well.

The NHS spends in excess of £40 billion a year on the procurement of goods and services, with the supply chains providing these commodities being global and employing hundreds of thousands of people worldwide. The British Medical Association has drawn attention to a growing body of evidence that, in some areas, the basic employment rights of people in these supply chains are being disregarded through low pay, long and illegal working hours, little job security, risk of serious injury from machinery, and the use of child labour. The BMA has commented that there was an uncomfortable paradox in providing healthcare in the NHS at the expense of workers’ health in its supply chains.

Responsible large companies have called for legislation to address the issue of modern slavery in the supply chains in order to eliminate unfair competition and create a level playing field. The British Retail Consortium and the Ethical Trading Initiative—which I think has some 80 corporate members—have expressed their support alongside the Trades Union Congress. Clearly, the effectiveness of what the Government are now proposing will be influenced by where the threshold for the size of businesses to be covered is set. One proposition put forward by a conglomerate of organisations that has been campaigning on this issue, is that the provisions should cover all companies operating in the UK with worldwide gross receipts of more than £60 million. My noble friend Lord Young of Norwood Green queried whether this was in fact the appropriate level.

The effectiveness of the Government’s proposals will also depend on what the statutory guidelines say about the information that should be disclosed. The Government have said that their proposals will have similarities to the California Transparency in Supply Chains Act, but we do not yet know how specific the Government will be in respect of the disclosure requirements.

It has been suggested by organisations campaigning on this issue that company disclosure should include at a minimum how risks have been identified through the supply chain; who has been involved in the identification of such risks; what action has been taken once risks have been identified, and the steps taken to address modern slavery if it is identified. Perhaps the Minister could say in his response whether that sort of proposition would be in line with government thinking.

While it is certainly true that legislation and disclosure alone will not eliminate modern slavery in supply chains, and that there is a need to persuade, encourage and help businesses take action in this area, there is also the issue—not least in the interests of those companies which deliver on their responsibilities—of what happens if a company does not provide appropriate information within a laid down timescale, or does so in a form that is vague and largely meaningless or provides information which is subsequently shown to be incorrect or misleading. However, as well as requiring companies to act there is also an issue over how easy or straightforward it is for UK companies to inspect their suppliers. Help and active encouragement may be needed in this direction. Some companies have said that it is sometimes cheaper to have Fairtrade-certified products, because that reduces their costs and the level of resources needed, than try to investigate suppliers miles away in other parts of the world.

Any proposals must cover both public and private companies, which I understand the Government’s amendment to the Bill does. Of course, there is still the issue of the size of the companies covered. Secondly, the legislation, in requiring companies to report on their efforts to eradicate slavery, needs to be specific about what information must be provided to ensure that it is possible to compare properly the performance in this area of one company against another and, through that kind of transparency, assist the position of the consumer in knowing to which company to go to purchase a particular product or service. Surely that must be part of the transparency. If this is not the case then it will make pretty meaningless the Government’s statement that,

“greater transparency will give customers, campaigners and shareholders the information they need to hold all big business to account while also supporting companies to do the right thing”.

Finally we will also want to see that there is a clear way of enforcing the regulations that will give effect to the legislation. Non-existent or weak enforcement is an invitation for some companies to get round the requirement that will be laid upon them and will defeat the objective of providing a level playing field and not leaving those companies that either have addressed slavery in their supply chains or are taking steps to do so at a disadvantage. The measure proposed will presumably apply to a significant number of firms. so even establishing that firms produced the required report will be a major exercise, let alone checking the quality of the report, including whether it meets the guidelines and is objective—for example, reporting not only successes but also on the areas where further action was required. Will the Minister at least outline what the Government’s intentions are in this regard?

We welcome the fact that the Government have decided to address the omission in their Modern Slavery Bill in respect of supply chains. We wait to see the detail of the proposals and the extent to which they are likely to make a genuine difference to working conditions in supply chains in the light of the Government’s statement, with which we agree, that modern slavery is a terrible crime.

[The Parliamentary Under-Secretary of State, Home Office (Lord Bates) (Con)]

My Lords, I begin on the point raised by the noble Lord, Lord Rosser. We entirely agree that modern slavery is a terrible crime. Indeed, that is underscored in the title of the Minister for Modern Slavery and Organised Crime. We see the connection between the two.

This morning, I began my day at the National Crime Agency, where I was told how organised crime in human trafficking is now in many ways overtaking trafficking in illicit drugs because criminals see that we are getting more effective in tackling drug culture and therefore they are turning to people. It seems incredible in the modern age that that is so, but it underscores the fact that criminals treat these people like commodities or chattels. That is why the term “slavery” is absolutely appropriate.

I join all noble Lords in paying tribute to the noble Baroness, Lady Kennedy, for securing this debate and also for the way in which she introduced it and covered all the broad range of points. In fact, the contributions have been of an incredibly high standard. There were a lot of questions and I have about 10 minutes in which to do my best to try and address some of them.

I should perhaps start by trying to place this in some sort of context. There is the amendment, and I accept that that is what the legislative process is about. We have pre-legislative scrutiny, which helps to shape the Bill, but we also have engagement with NGOs. We have round-table discussions, in which the Home Secretary is taking part, and we listen to business and to the NGOs, and we feed in various ideas. We then came forward with the proposed amendment on supply chains, which was tabled yesterday. It is to be debated and formally moved on Report on Tuesday in the other place. I know that I was invited to discuss a lot of the detail about what the amendment will do and the effect it will have, and of course your Lordships will have the opportunity to consider this. However, in order to observe correct practices within the department, my colleague Karen Bradley should be allowed to set out these issues in detail in the other place on Tuesday. We can then debate this when the Bill comes here on Second Reading.

The noble Baroness, Lady Kennedy, referred to the importance of leadership. That is absolutely vital in this regard. During her speech, I reflected on undertaking my MBA dissertation in China many years ago, looking at supply chains for—I had better be careful—what I will only say was a major international footwear manufacturer, and seeing the conditions that people were put under. The point made by the noble Lord, Lord Young, to whom I pay tribute for his work with the Ethical Trading Initiative, also brought home to me how, because of the increased demands from consumers for more intricate designs in their footwear and a lack of investment in appropriate equipment to do this, these young girls—and it was mostly young girls in those factories—were suffering horrendous injuries in trying to fulfil the demands of western consumers. Consumers therefore need to see themselves as very much in the frame here. This is something which we all need to address, and on which we all need to exercise judgment and leadership.

My noble friend Lady Hamwee referred to the scale of the problem, and her description of profits as being generated on the backs of these people was a very apt depiction of what we are looking at here.

The determination is there to take action. The amendment is of course one part of the Modern Slavery Bill, which is one part of the whole picture. The Minister for Modern Slavery and Organised Crime is another part. The National Crime Agency, which looks at organised crime and gang-related issues, is another part. The Serious Crime Bill, which we are considering and to which the noble Baroness referred, is looking at disrupting this evil trade with gang prevention orders and a range of other sanctions. That is another part, and there will be yet other parts required. There will be a modern slavery strategy, which will be brought before your Lordships during the passage of the Modern Slavery Bill through this House. We expect that to arrive with us before Committee stage, so that noble Lords will have an opportunity to look at it. That is another part of it.

I pay tribute to the previous Government for introducing the Gangmasters Licensing Authority and the work which it has done. We are moving it from Defra into the Home Office as part of this overall initiative, and I think that was touched upon by the right reverend Prelate the Bishop of Derby. We want to see that happen. However, I think it was absolutely right for the scale to be focused on.

The noble Baroness, Lady Cox—I want to call her my noble friend—has done so much in this area internationally in speaking up for those people. She summed it up perfectly when she talked about the clothes your wear, the phone in your pocket and the food on your plate. This touches every part of our daily lives. We need to think about the hands that prepare and make these things.

There needs to be activity on this issue not just in the Home Office but across government. Indeed, there are inter-departmental committees. However, we are talking about activity not just within this country—although the noble Baroness was right to point out that it is sometimes our fashion to take a great interest and almost a certain pleasure in telling people in other jurisdictions and other countries how they should behave without recognising that we have a very serious problem right under our noses in this country which we need to address. Figures presented to me this morning show that it is believed that nearly 3,000 people in this country fall into the category of slavery at the present time. We need to work on that.

The noble Baroness may be interested to know that, as part of a joint FCO-Home Office project in December last year, the NSPCC trained—many noble Lords referred to the need for training—UK and Nigerian officials better to identify trafficked children in Abuja, Nigeria, and repeated that training in Hanoi and Beijing. The Department for International Development also works in a number of ways which directly and indirectly help combat modern slavery. More specifically, DfID runs a Work in Freedom programme in partnership with the International Labour Organization to help girls and women in south Asia avoid being trafficked to work in the Middle East in domestic worker and garment manufacturing sectors. More than 100,000 girls will directly benefit from this project over five years. So it is part of a wider initiative.

A number of noble Lords referred to the public sector and were telling the private sector what it should be doing. Under the Companies Act, a requirement was introduced to include a statement on human rights in the annual report, which would of course need to be signed off by the directors, who carry the ultimate responsibility for standing by that report. The accuracy of that statement is every bit as important as the accuracy of the financial data which are in subsequent pages. Under an amendment which has been proposed and which will be debated, we will look at what form that statement should be in to make sure that it is clear that firms have given due cognizance and shown due diligence in sourcing materials as part of their trading.

Other noble Lords said that the Government themselves need to do more. Some specific, quite disturbing issues relating to the Department of Health were mentioned, including by the noble Baroness, Lady Hamwee, and the noble Lord, Lord Young. The Department of Health and the NHS Supply Chain have developed a labour standards assurance system that encompasses issues of forced labour. This is used as a basis for auditing suppliers in categories of supply where the risk of labour standards abuses is assessed as being high. To date, this approach has been successfully applied to supply agreements covering surgical instruments and medical textiles, and it will be extended to cover other categories in the future as agreements are retendered. The Department of Health is working with the Ethical Trading Initiative and the British Medical Association to develop guidance. I understand that there are concerns in that area, but some steps are being taken.

I shall try to deal with one or two other points. On minimum requirements, which were mentioned by the noble Baroness, Lady Cox, the Modern Slavery Bill allows the Secretary of State to publish detailed guidance, on which we will consult widely. Disclosure must be published prominently on an organisation’s website and home page.

The noble Lord, Lord Rosser, asked where the California-style disclosure list sat in the Government’s thinking. We will be publishing guidance on the kinds of formation in the disclosure and will consult on these matters. We will consider the Californian requirement very carefully in this exercise, along with any other helpful examples. In conclusion, we will return to this issue many, many times in your Lordships’ House, and rightly so.

[Lord Rosser]

I ask the Minister—and I accept that in the time he has had it was not possible to respond to the numerous questions raised, and he has referred to the amendment coming up in the other place shortly—whether he is prepared to look at Hansard and the various questions that have been raised and, if he feels that he has not responded to some of them, whether he will write to noble Lords who have raised those questions, so that we have those replies ready for Second Reading in November?

[Lord Bates]

That is a very good suggestion. I was certainly intending to do that, and I will make sure we do it. It would also be helpful if noble Lords who take an interest in this area could meet me and the officials who will be working on the Bill to talk through the detail of it, ahead of Second Reading on, I think, 17 November. I would like to do that. We share a lot of common ground in trying to make this work, and once again I pay tribute to the noble Baroness for bringing it before us today.