UK Company Supply Chains

Debate between Huw Irranca-Davies and Anas Sarwar

Tuesday 16th December 2014 Westminster Hall

[Huw Irranca-Davies (Ogmore) (Lab)]

It is a pleasure to take part in this important debate. I thank my hon. Friend the Member for Wansbeck (Ian Lavery) for a good opening speech, in which he highlighted the severe exploitation of workers in the tobacco industry, particularly under British American Tobacco and R. J. Reynolds. My hon. Friend the Member for Paisley and Renfrewshire North (Jim Sheridan) made specific reference to the Blood Bricks campaign, and there are many other examples. My comments will centre on the food industry.

As the debate is focused on the UK’s supply chain, I will consider not only what we could do with regulations, but what we should tell supermarkets. There are effectively only six major buyers among the supermarkets and retailers in the UK. Those buyers sit in offices alongside people who are responsible for corporate responsibility and ethical trading. If they wanted to, they could drive a race to the top, rather than a race to the bottom. There is case for regulation, as I will describe in a moment, but there is also a case for going beyond regulation and actually telling companies, “You should be showing British leadership and world leadership.” We should go far beyond what regulations can deliver and seek far higher standards right along global supply chains.

[Anas Sarwar (Glasgow Central) (Lab)]

My hon. Friend mentioned global leadership. The UK shows such leadership with our international development objectives in many of the countries where supply chains are located. Does it not make sense for us—a partnership of our business community, our public and our Government—to ensure that we are helping development in such countries with measures such as fair pay, decent work and decent working standards?

[Huw Irranca-Davies]

I agree entirely. While today’s focus has been on the deplorable gross exploitation of workers in different parts of the world, there is also routine, daily exploitation through the suppression of wages and the absence of terms and conditions and protections. There is no recognition not only of unions, but of grievances in the workplace. Many workers experience a dampening effect that keeps them under control, having to do what the employer says because they have no voice.

My hon. Friend is right to suggest what our cross-Government international development approach should be on the food and clothing sectors and so on. We should not only look to see where regulation can work, but work with the sectors and say, “As an island nation, we have such global reach that we should be forcing standards up.” We should not be waiting to be told to do that; we should be working at it now, whether in Africa, India or South America. Ultimately, if we have products on our shelves that are being produced extremely cheaply, we know that somebody or something is being exploited somewhere. In the food sector, that could mean exploitation of animals, communities or workers.

I ask hon. Members to cast their minds back to 2004 when some of this debate began. In the Morecambe bay tragedy, 32 Chinese cockle pickers died out on the mud banks. It was a horrendous incident that woke the country up to something that we thought could not happen in a modern society. Chinese workers, trafficked by rogue gangmasters into the UK, were exploited in terms of pay and conditions and then placed in hazardous and ultimately fatal conditions. They were paid £5 for 25 kg of cockles while being left to the ravages of the tide. In the eyes of the gangmasters, they were expendable. As a result of a cross-party and cross-sector approach, many people came together and said, “We must deal with this,” and the Gangmasters Licensing Authority was established as a result.

The GLA has done tremendous work on tackling exploitation in a lean and mean way, but it is still happening. Back in 2012, two people were arrested in Kent following the exploitation 17 Lithuanian workers, who were being moved around the country in minivans to work. Sometimes they went without pay for weeks on end. Sometimes they received a pittance, but with deductions. They slept in a van as they travelled. When they were not sleeping in vans, they slept on floors in the most basic of portakabin accommodation. It was complete exploitation. What surprised people after it was picked up by the GLA was that it was occurring in our supposedly reputable food supply chain. It involved Noble Foods, which supplied companies such as McDonald’s, Tesco, Asda, M&S and Sainsbury’s. The products that Noble Foods supplied to those companies included—with no irony—chicken bearing the Freedom Food mark, yet people working for the company were being exploited and had no freedom themselves. It was debt bondage. They worked 17-hour shifts and slept on buses. It was crazy.

Well done to the GLA on that, but the point has already been well made by my colleagues that the GLA needs to follow its intelligence whenever exploitation is taking place. We know that it happens in the social care and construction sectors. It is a lean, mean organisation that now needs to target sectors where its nose suggests there is a stink and where exploitation is occurring.

I want to consider a more recent case that brings the issue right back home and into the produce that we take off the shelves and put on our plates. It has been reported that abuse and exploitation are widespread in the Thai fishing industry. It looks very much like slavery, but certainly involves human rights abuses. Thailand produces 4.2 million tonnes of seafood each year, 90% of which is exported. The main markets are the USA, the EU and the UK—we do like our seafood. The Guardian reported this year that people were forced to work 20 hours a day and endured regular beatings if they complained. They received one plate of rice a day to keep them going. People were purchased by boat captains from brokers for between £450 and £640—direct, old-fashioned slavery and exploitation of human beings. At every stage officials were bribed, so that the slaves could be brought in. The Guardian reported that a slave trafficker called the Thai police “business partners”, while the people forced to do the work were seen as expendable. Kevin Bales, an anti-trafficking activist, estimates that slaves cost 95% less than they did at the height of the 19th-century slave trade.

The vessels that use those slaves each year catch roughly 350,000 tonnes of so-called “trash fish”, turned into fishmeal for multinationals such as CP Foods, which supplies major retailers in the UK, including Asda, Iceland, Tesco, Morrisons and the Co-op. Many of those retailers—I come back to the point about the power of the retailers and the six major buyers in the UK—were not aware of what was going on, but many people would say, “You did not show due diligence in looking at what was happening in your supply chain.” The case has woken many retailers up, but the question is, why did it take that to wake them up?

CP Foods has stated that it requires its factories to buy trash fish only from legal and licensed boats. Captains, however, often fail to record where their fish comes from, so how can we have a trail for where the fish is being purchased? Tesco says that it regards slavery as unacceptable, and it is working with international organisations such as the ILO to achieve a broader change in the Thai fishing industry. All the retailers who were caught out have responded rigorously, in part to deal with reputational damage.

Exploitation remains a major concern. The two biggest industries in which exploitation, trafficking and slave labour are rife are the garment industry and the food industry. A tremendous amount could be done by the British food sector. My hon. Friends have already mentioned asks that go beyond where the Government are with the Modern Slavery Bill. We want to see elements from the Ethical Trading Initiative brought forward. We want to see comparability between different companies on reporting along the long line of their supply chains; we need to be able to compare Marks & Spencer, Tesco and everyone else in the UK—apples with apples, not apples with pears. We want to see directors having individual fiduciary duties to ensure the accuracy of reporting; we do not want another Thai fishing industry exploitation case to come up and a director to say, “I knew nothing about it. I did my best, but someone lower down the chain is responsible”—that is not good enough. Things have to stop right at the top; leadership has to come from the top. We also want not only large public, but privately listed companies included.

A lot more can be done, not only with regulation, but by working with such companies, so that we go way beyond regulation and so that the UK shows real leadership in ending exploitation in the food sector and every other sector mentioned by my colleagues. Consumers can also play a role, because the consumer voice, as we have seen in recent history, frequently shames sectors into taking action. Let us get on with it.