Modern Slavery Bill

Lord Stunell Excerpts

Tuesday 4th November 2014 Commons Chamber

[Karen Bradley]

The right hon. Gentleman makes exactly the right point. This is about ensuring that any company doing business in the UK makes transparent disclosures on the action it has taken on slavery in its supply chains. We want UK consumers to understand what actions have been taken by the businesses they transact with so that they can then put pressure on them if they feel that not enough is being doing. The Government will be able to help those companies through the guidance we issue on the action they may take that would give consumers the reassurance they need. We have also improved on the California model by capturing any commercial organisation that produces not only goods but services.

We are also looking at public sector procurement, recognising that modern slavery could happen anywhere. All public sector suppliers are already required to comply with relevant human rights and employment law, and EU procurement rules require contracting authorities to exclude suppliers that have been convicted of certain offences. Social responsibility information is also sought annually from Government suppliers, including details of the steps taken and planned by suppliers in the areas of ethical procurement and supply chain management.

I will now turn to new clause 5, tabled by Opposition Front Benchers, which would require the Secretary of State to make regulations under section 416(4) of the Companies Act 2006 so that quoted companies and certain large private companies are required to include in their directors’ reports information relating to modern slavery and forced labour in the supply chain. It is fair to say that we are all trying to achieve the same aim—ensuring that the supply chains of UK businesses are free from slave labour—but the ways in which we are seeking to do that may well differ. In considering this important issue, we have looked at a number of approaches, including amending the Companies Act and, in particular, the Companies Act amendment proposed by the pre-legislative scrutiny Committee.

I believe that introducing a specific provision in the Modern Slavery Bill, rather than in the Companies Act, sends out a clear signal that the UK will not tolerate any form of modern slavery. It also explicitly raises the profile of the issue by ensuring that the provisions are front and centre of what the Bill and this Government are trying to achieve: to stamp out modern slavery in all its forms. I think that all of us in this House are trying to achieve that. Those who disclose little or no action risk their reputation and, ultimately, their profits.

New clause 14, tabled by the hon. Member for Foyle (Mark Durkan)—he, too, served on the Public Bill Committee—would ban the import of any product produced by slavery, forced or child labour or human trafficking. As I have said, I believe that slavery in all its forms is abhorrent. The provisions we have brought forward to increase transparency in supply chains are both effective and proportionate. It would simply not be feasible for UK agencies to police the import of goods on the basis of whether they had been produced using slave labour. We need those trading with companies in other jurisdictions to apply due diligence and take decisive action where they believe that slave labour is being used. Waiting until the point when products are being imported into the UK is simply too late. That is why it is for businesses to take action to check their supply chains and for the Government to influence and encourage other Governments to do more, such as by improving the application of their employment laws or their approach to human rights issues.

[Sir Andrew Stunell (Hazel Grove) (LD)]

I thank the Minister for working so hard to introduce new clause 11, which I very much welcome. Will she cover the point raised in an earlier intervention about the role of the anti-slavery commissioner? As she will know, the terms of reference were discussed in Committee. It would be useful to know whether the Government think that the commissioner’s remit will include looking at company reports and assessing how effective they are.

[Karen Bradley]

I thank my right hon. Friend for his comments and for all his work, not only in the Public Bill Committee but in the pre-legislative scrutiny Committee—he has truly lived this issue for most of this year, so I know how committed he is. I think that policing the measure is a matter for us all. In particular, the non-governmental organisations that work on victim protection—I discussed this with them last week—have such an important role to play in bringing to our attention those companies that they believe are not doing the compliance and disclosure that we all expect. We will move on to the specifics of the anti-slavery commissioner’s role later in the debate. My emphasis for the commissioner is on identifying victims and then ensuring that we get prosecutions in order to protect victims. The role is not so much about policing the supply chain measure. Obviously, as the commissioner’s role develops, we may see new issues come to the fore.

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[Diana Johnson]

I could not agree more. That is why it was important that I set out why new clause 5 deals in detail with the kind of issues that need to be clearly addressed in secondary legislation. I am grateful for the hon. Gentleman’s intervention.

Just to recap: we support the Government’s new clause 11. Obviously, we want to wait and see what happens with the secondary legislation as it is introduced. It is surprising that the Government have gone against the Joint Committee’s recommendation and the evidence presented by several large companies arguing against stand-alone regulation, although the Government have now seen fit to pursue that. That poses particular problems for enforcement. I am sure the Minister has seen the briefing from the coalition of groups campaigning for change, which states:

“Monitoring of compliance with the provision needs to be taken seriously as this will be central to its success in driving change. We are concerned that the provision is currently weak on how monitoring and enforcement will be undertaken. The Government’s approach relies on a civil enforcement procedure by the Secretary of State, which means that in reality the measure would be unlikely to deter any businesses other than those who would in any case seek to comply on a voluntary basis.”

[Sir Andrew Stunell]

I thank the hon. Lady for giving way—I hope she will be able to wet her whistle while I speak. Does she agree that the monitoring process could make a start through the anti-slavery commissioner taking a more active role in observing and supervising company reports?

[Diana Johnson]

The right hon. Gentleman makes a very important point. Time is limited this afternoon, but I hope there will more discussion in the other place about extending the role of the independent anti-slavery commissioner to do exactly what the right hon. Gentleman has said.

In the Minister’s closing remarks, I want assurances that whatever is proposed will apply to all large companies; that the regulations will be detailed enough to allow comparability; and that there will be a clear enforcement mechanism so that consumers, investors and NGOs can see who has complied and know that they can trust the report they have read.

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[Mr Burrowes]

Other countries could do that, but they have different means of enforcement, which cannot be simply transferred. However, they could certainly take a lead by adopting much of what new clause 11 says.

[Sir Andrew Stunell]

My hon. Friend has done valiant work on this topic. I agree with him that the enforcement angle needs more attention, but does he not agree with me that new clause 11 takes us a huge step forward? We should congratulate the Government on that, and now invite them to take the next step and get the enforcement right.

[Mr Burrowes]

I do not want to understate my praise—this is a huge step forward—but we, as legislators, want to ensure that what we approve is really fit for purpose and has the necessary teeth. There are other elements that can be done without legislation: the issue of international corporate governance goes beyond legislation, and it can best be dealt with by sharing good practice internationally.

I will finish on a very positive note. Today, we can say that British law is no longer just concerned about the sustainability of the wood in our furniture, but is more concerned about the freedom and safety of the millions of men, women and children involved in making that furniture.

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[Karen Bradley]

I addressed that point briefly in my opening comments, but I will come on to it again in a moment. I will just finish the point about enforcement.

The courts can force companies to disclose, but that is different from the issue that some companies may make disclosures that consumers, shareholders and campaigners feel show that inadequate steps are being taken to eliminate slavery from supply chains. The courts can act if no disclosure is made, but there is action that civil society can take if it feels that companies are not making appropriate disclosures. The Government believe it is for civil society to put pressure on businesses that are not doing enough to eliminate modern slavery from their supply chains. The Government’s new clause makes this as easy as possible by ensuring that disclosures are easily accessible. The link to disclosure must be in a prominent place on a business’s website home page.

Before coming on to public sector procurement, I would like to address the concerns expressed by the hon. Member for Foyle (Mark Durkan) on the extent of the new clause. I can confirm that the new clause on supply chains will apply to England, Wales, Scotland and Northern Ireland. This is made plain by later amendments to be taken later. I want to put it on the record that I am grateful to the Northern Ireland Executive and all the devolved Administrations for the excellent work we have done together to ensure that this provision can extend to the entire UK. He will know, from our discussions in Committee, that there were points on which we needed agreement—not just on this matter, but on many others as well. I am pleased that we have made so much progress. It was important throughout that this was not Westminster imposing on the devolved Administrations. Action has been taken because the devolved Administrations wanted to take that action.

On public sector procurement, all public sector suppliers are required to comply with applicable law, including relevant human rights and employment rights law. UK public procurement policy is that social, environmental or ethical issues can be taken into account in the procurement process where that is relevant, proportionate and non-discriminatory. We expect public sector procurement to be as transparent as other procurement, which is covered elsewhere. We will consult on this matter, and I encourage people who are concerned to respond to the consultation. It should be noted that whatever action is taken will be taken only following the affirmative procedure to ensure that Parliament has its say. We will ensure that points are put forward.

[Sir Andrew Stunell]

The Minister speaks very well on Parliament giving affirmative support to these proposals. Does she envisage that being given before the first week of May next year? [Interruption.]

[Karen Bradley]

The shadow Minister makes the point that perhaps that needs to be by the end of March, if the right hon. Gentleman is asking whether it will happen before the general election. I cannot answer that question at the moment. Perhaps I could write to him on the specifics.

I am delighted that new clause 11 will amend the Bill to include the measure on transparency in supply chains that so many have worked so tirelessly for, for so long. I hope right hon. and hon. Members will not press their amendments to a Division. I look forward to this measure being part of the world-class Bill we all wish to create.

Question put and agreed to.

New clause 11 accordingly read a Second time, and added to the Bill.

New Clause 3

Offence of child exploitation

‘(1) A person commits an offence if they exploit a child.

(2) It shall be such an offence even if there was no threat or use of violence, other forms of coercion, deception or any abuse of a position of vulnerability.

(3) A child may be in a situation of exploitation whether or not—

(a) escape from the situation is practically possible for the child; or

(b) the child has attempted to escape from the situation.

(4) The consent or apparent consent of the child to the exploitation is irrelevant.

(5) “Child Exploitation” includes but is not limited to, the exploitation of the prostitution of others or other forms of sexual exploitation; the exploitation of labour or services including begging or practices similar to slavery, servitude or forced or compulsory labour; the exploitation of or for criminal activities including benefit fraud; the removal of organs; forced or servile marriage or enforced surrogacy; exploitation for unlawful adoption; and exploitation by enforced drugs smuggling, manufacture, production or distribution.”—(Diana Johnson.)

Brought up, and read the First time.

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[Karen Bradley]

I am grateful to right hon. and hon. Members for tabling measures and speaking in this debate, which covers three extremely important subjects: the role of the Gangmasters Licensing Authority, abuse of overseas domestic workers and prostitution. Given the time available and volume of the debate, I will do my best to address the points that have been made, but I hope Members will forgive me if I do not cover absolutely everything.

First, on the remit and powers of the Gangmasters Licensing Authority, I am grateful for the opportunity to restate that the Government are determined to tackle labour exploitation effectively. As I said in Committee when a similar amendment was tabled, I am sympathetic to Members’ concerns. The GLA does good work in tackling harmful activity within a limited remit, focusing on areas that are potentially vulnerable to exploitation. My mind is not closed to changes to improve how it works—far from it.

The Government support the protections in place for all workers, whichever sector they work in, including minimum wage legislation—we have strengthened the national minimum wage inspections team and quadrupled the maximum fine. The amendments suggest a number of ways in which to change the GLA’s powers and remit.

[Sir Andrew Stunell]

I am encouraged that the Minister says her mind is open and that there will be further consideration. Can hon. Members take that as a distinct hint for more progress in the Lords?

[Karen Bradley]

If my right hon. Friend will allow me to continue my comments, I will speak first about new clause 1. The new clause would open the way for the GLA’s remit to be extended to any area of work or sector, which would be a much broader role than its current territory. I have concerns about such a broad role, which I want to put in the context of the Government’s plans to ensure that the GLA delivers its critical role. The GLA is both a licensing and an enforcement body. We need to make progress on both fronts. Licensing can be a blunt instrument in that it affects the compliant business and the rogue gangmaster alike. If a licensing regime is not targeted at known risk factors, it will not provide effective underpinning for enforcement. Therefore, simply extending the current licensing regime into new sectors would not of itself improve efforts to tackle exploitative employers who flout the law.

I want a GLA with a strong anti-slavery and worker exploitation focus that will support the Government’s broader strategy on modern slavery. That will be best achieved by developing an approach that builds on the GLA’s excellent work. The right hon. Member for Delyn (Mr Hanson) mentioned that the number of GLA investigations had declined over time. I want to put it on the record that, over time, the GLA has undertaken a reduced number of investigations, but they have been more complex and have focused more effectively on serious and organised crime. That reflects a targeted and risk-based enforcement approach.

We can do more to increase the GLA’s reach and effectiveness. We are working with the GLA in three main areas: through the better business compliance partnerships, the review of licensing standards, and work on the supply chain. I do not have time to go through those points in detail.

Looking ahead, the GLA is well placed to tackle the serious worker exploitation that lies between the more technical compliance offences investigated by HMRC and the serious and organised crime addressed by the National Crime Agency. We will consider how to introduce more effective and targeted enforcement action by the GLA. We will also consider changes to the GLA to support its greater role in addressing exploitation. However, we believe this requires a more considered analysis of the types of changes required than simply changing the law today. I believe we should continue the hard work with the GLA rather than simply assuming that the answer is to extend the remit of the GLA beyond the core areas set out in the 2004 Act, as envisaged in the new clause. I therefore hope that the right hon. Member for Delyn feels able to withdraw it.

On the amendments tabled by my hon. Friend the Member for North East Cambridgeshire (Stephen Barclay), he has made some very good points and I would like to discuss many of them with him outside the Chamber. New clause 16 would require formal tenancy agreements where a gangmaster provides accommodation for workers. I reassure him that the GLA already addresses this risk. The current suite of GLA licensing standards already imposes requirements on gangmasters who provide accommodation. Specifically, licensing standards 4.1 and 4.2 require a licence holder who provides, or effectively provides, accommodation to ensure that the property is safe for the occupants. A licence is required by the local authority, for example if it is a licensable house of multiple occupation. This is a critical standard for the GLA, so failure to meet the criteria will mean that a licence application is refused or a licence already issued will be revoked.

There are also existing legal requirements affecting the relationship between tenant and landlord. I believe that these, together with the GLA’s licensing standards, provide strong protection for workers. However, I have considered the amendment in detail and I will ask the GLA to consider adding a tenancy agreement to the documents to be provided to demonstrate compliance with the licensing standard as part of its forthcoming review. In doing so, I also wish to ensure that we are balancing protection from exploitation with our desire to reduce bureaucracy for small businesses.

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[Sir Andrew Stunell]

I will leave time, I hope, for the right hon. Member for Birkenhead (Mr Field).

We have moved a long way during the passage of the Bill, and I welcome every step. We are very near to having a world-class Bill, but we are not there yet. I hope that the Home Secretary will read the debate and listen to what was said about the Gangmaster Licensing Authority in particular, and about exploitation as a separate offence. There is still considerable work to do, but I commend the ministerial team for their work, the way they have listened, and the way this Bill has progressed through the House.