It is a pleasure to serve under your chairmanship, Mr Hollobone.
This time last year, on 20 June 2012, I held a debate on the Gangmasters Licensing Authority, and the then Minister, my right hon. Friend the Member for South East Cambridgeshire (Sir James Paice), who is my constituency neighbour, assured the House that he had
“a package of proposed changes to the GLA, including…looking at the scope to use civil penalties.”
Indeed, he very kindly went on to say that I was right in calling for the ability to fine gangmasters. He said that the GLA board had “very few enforcement weapons” and that we needed
“a tier of measures for it to utilise.”—[Official Report, 20 June 2012; Vol. 546, c. 276WH.]
It therefore may surprise the House and you, Mr Hollobone, to learn that despite the Minister’s saying that that analysis was right, the Department’s own consultation now specifically excludes the tier of measures to which my right hon. Friend was referring.
We should remind ourselves of what is at stake. I am very pleased to see my hon. Friend the Member for Morecambe and Lunesdale (David Morris) in his place. He will know that the GLA was set up in 2004 after the tragedy of the Morecambe bay cockle pickers disaster. He has spoken most effectively in bringing these issues to the attention of the House previously. We are talking about legislation that is directed at protecting the most vulnerable people in society and particularly those working in the agricultural sector. In many cases, they are a long way from home, have difficulties with the language and are fearful of authority. They are therefore vulnerable people who do need protecting.
It is remarkable that the consultation brought forward by the Department seems to be excluding the measure that the Minister, in response to my debate last year, said was an important tool that was lacking and needed to be included. It may be helpful if I set out why I think that the Department has got itself into this situation. I think that it is in large measure down to another ministerial statement. We all like cross-departmental working, and it is very good that the Department is taking note of ministerial statements elsewhere. The Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon), quite rightly articulated concerns about red tape. That is a concern that many hon. Members share. My right hon. Friend therefore set out a new test: it was a general rule that new powers to fine should not apply to firms with fewer than 250 people. There was good logic to bringing in that measure, but it was a general rule; it was not absolute. This Minister may want to clarify the position with his officials. Obviously, the measure has been signed off by Ministers, but there almost seems to be a bit of gold-plating whereby what is a general rule has been applied in absolute terms.
Of course, most gangmasters do not employ more than 250 people. Indeed, if they did, the existing powers would be confined just to those above 250, but we do not do that for the criminal powers, so is it not illogical that for criminal powers we say that they apply to the gangmaster population as a whole, yet for civil powers, where one assumes a lower test, we raise the bar and say that they apply only to gangmasters with more than 250 people working for them? That is at odds not only with what the Minister said to me this time last year in response to my debate, but with the existing legislation under which the Department is acting. It is also—dare I say it?—at odds with common sense, because if we look at the use of criminal powers, we see that it is clearly not working.
Let us take, for example, two recent cases in Northern Ireland. In those cases, the fines imposed on the gangmasters acting illegally and making large sums of money—often, gangmasters are not paying tax, and quite often they are linked to other crime, such as prostitution and counterfeiting—were just £500 apiece. I think that most hon. Members would accept that the profits that those gangmasters had made far exceeded the fines that were imposed by the courts. We have a strange situation in which we have criminal powers, which the GLA rarely uses. If a gangmaster is unlucky enough to be caught, they know that the fine is likely to be less than the profits that they have made. They know that, on most occasions, witnesses are very fearful of coming forward and therefore the number of prosecutions is very low. Last year, for example, there were just 15 prosecutions against gangmasters.
Let us put that in context. We currently have under way—I am very grateful to my right hon. Friend the Home Secretary for the support that she has given—an operation in the fens, which my hon. Friend the Member for Peterborough (Mr Jackson) will be familiar with, Operation Pheasant. So far, it has raided 80 homes and it has a number of live inquiries, but it is finding the most horrendous issues. We had a case recently in Whittlesey in which migrant labour was living in a house and there was CCTV not just on the front and back doors but in the inside rooms in order that the gangmaster could control his labour force. We have had other cases of people living in a garage with an open sewer.
This is an issue not just for the vulnerable in communities such as mine and that of my hon. Friend the Member for Peterborough but for the local residents, because where there are high concentrations of houses in multiple occupation, there is antisocial behaviour. It is very difficult for people to stay in the house, so they tend to go out and street-drink. When they street-drink, we get urination on people’s front doors. I cited some particularly unpleasant and disturbing cases in the debate last year. I will not detain hon. Members by rerunning those, but it is very clear that there are issues of antisocial behaviour and legitimate concerns for the local population that flow back to our unwillingness to tackle gangmasters.
Therefore, I suggest to the House that the key way in which we should be tackling gangmasters is by hitting them in the area that they are most concerned about. That is in their pocket; it is through fines. That is the way in which we will change their behaviour, so I find it remarkable that the consultation from the GLA is excluding a tool that the Minister last year said was important, is gold-plating a legitimate concern of the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks, and applying that in a bizarre and arbitrary way and is failing to address the legitimate concerns about antisocial behaviour with enforcement, because the criminal tools that are used are not working. They are rarely applied. The fact that there were just 15 prosecutions clearly shows that they are not working. Then when there are prosecutions, the level of the fine is derisory.
I say to this Minister that I find the situation quite disappointing. I, as a Member of Parliament, articulate real concerns about things affecting my constituency. The Home Secretary acts on those concerns with Operation Pheasant. We have good support from Cambridgeshire police—in the debate last night, I paid tribute to Inspector Sissons and the work that he is doing. I am keen that my local council do more, and I have been in active discussions to ensure that it uses its powers. I am very sympathetic about the difficulties of resourcing that the GLA has. We all know that the last Government left us with a huge level of debt. Although I believe that the GLA should be far better resourced—I think that that would be a good use of the Department’s budget—I am very sympathetic about the difficulties that the Department faces because of what was inherited. But surely the answer, if we have a problem in trying to resource it more, is to make it easier to prosecute—to make it easier to impose fines, because it is the fines that will change the behaviour of the gangmasters.
We are not talking about all gangmasters; there are perfectly respectable gangmasters, but we know that there are illegal gangmasters and heartbreaking abuses taking place in my constituency and the constituencies of hon. Members across the fens. Unwarranted pressure is being placed on local residents, who often have to bear the consequences of the antisocial behaviour that flows from the concentration of houses in multiple occupation and the lack of enforcement against illegal gangmasters, who often misleadingly attract people from overseas. Illegal gangmasters will go to Lithuania for example and say, “Come to the fens. You have a guaranteed job and guaranteed accommodation.” When the workers arrive, there is often only one, two or three days’ work before they exhaust their savings, are in debt and the gangmasters have control.
There are real issues and they were raised last year. Other Departments have gripped the problem and acted. The Minister for Housing, my hon. Friend the Member for Hertford and Stortford (Mr Prisk) is organising a workshop in the fens, in Wisbech, for councils, so that we can share best practice. Other Departments are acting, but the Department of the Minister who is here today is not. Not only is it not acting, but it is ignoring the assurances that I felt were given to me last year, in my interpretation of what the then Minister, my right hon. Friend the Member for South East Cambridgeshire said. In bringing this debate before the House again, I hope that the Minister here today will look again at his consultation and at whether the powers it equips the GLA with are adequate. If he wants to take this opportunity to announce additional resource for the fens, I will be delighted, but if he is not going to do that, what exactly is he going to do?
My hon. Friend is making a powerful and fluent case. I pay tribute to his great campaigning work on illegal gangmasters. Does he agree that time is of the essence? The imperative is to do something soon, due to the free movement directive and the likely immigration of Romanians and Bulgarians next year. The Home Secretary has said how important reducing pull factors is, and measures on gangmasters would be part of that portfolio of policies, so the urgency is very much apparent.
My neighbour and hon. Friend is right; there is urgency. I am sure that he shares my frustration for that reason. A number of us have been raising concerns for some time. I secured a debate on gangmasters last year. I raised concerns in the main Chamber. I have been to see the Home Secretary on a number of occasions. The police inspector came to see Lin Homer, the top official of HMRC, with me last year. For cross-departmental government to work, DEFRA needs to come to the party and get involved and the purpose of today’s debate is to draw the consultation before the Minister more firmly to his attention. I think that the ministerial statement of the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks, has been misinterpreted.
I hope that the Minister here today can reassure us, but if not, ultimately I hope that he can address the concern of my hon. Friend the Member for Peterborough: what will the Minister’s Department do through the GLA to effect change on the ground? If we are to maintain community cohesion, the GLA matters. To address the antisocial behaviour that flows from the consequences and criminal actions of illegal gangmasters, the GLA must be part of the action taken. I therefore hope that the Minister can reassure the House that the comments of his predecessor, my right hon. Friend the Member for South East Cambridgeshire, will form part of the consultation and the response to tackle illegal gangmasters operating in the fens.
It is a pleasure to serve under your chairmanship this afternoon, Mr Hollobone. I congratulate the hon. Member for North East Cambridgeshire (Stephen Barclay) on securing the debate. I am pleased to see his colleagues, the hon. Members for Peterborough (Mr Jackson) and for Morecambe and Lunesdale (David Morris) here. I know that they share a common concern about the operation of gangmasters in their constituencies.
It is important that I open by saying how significant the operation of the Gangmasters Licensing Authority is. We need it to work for precisely the reasons that the hon. Member for North East Cambridgeshire set out: to ensure that very vulnerable people are not exploited by criminals—let us be clear, they are criminals—who wish to use the opportunities that arise from people coming from overseas and finding themselves in a vulnerable situation.
I would like to respond to the points that the hon. Gentleman made, but also to say a few words about the proposed improvements to the operation of the GLA, which has done and continues to do a great deal of valuable work, which most people recognise, to protect and enforce the rights of vulnerable workers. Many reviews over recent years, including the farming regulation task force and forestry regulation task force, have looked at the GLA’s work, and there is general recognition among stakeholders that it has been effective in improving working conditions in the regulated sectors.
In recognising the highly valuable work the GLA has done, the reviews have also shown that there is room for improvement, so there is an opportunity to make the GLA a modern enforcement agency that better targets criminal activities, while applying a light touch elsewhere. That is one of the thrusts of the work we have done. Part of the consultation that is happening at the moment is about how we can take our foot off the pedal in areas where it is not needed, to concentrate resources on the areas that the hon. Gentleman has drawn to the attention of the House.
Through the employment theme of the red tape challenge, the continuing need for the GLA’s work was endorsed, alongside the need to bring forward measures to ensure that it can become more focused on the worst excesses of worker exploitation in the sectors it regulates. As the hon. Gentleman said, my predecessor, the right hon. Member for South East Cambridgeshire (Sir James Paice), announced, via a written statement to Parliament a year ago, the range of reforms that would come forward.
The GLA will increase joint working with other agencies involved in stamping out serious organised crime activities, including human trafficking, money laundering, tax evasion and other serious organised crimes. To enable that increased focus on the serious criminal elements in the supply of labour to the food and food processing sector, the GLA will modify its processes and deploy its resources in a way that relieves the burden of regulation from highly compliant businesses, but targets criminals through improved intelligence gathering.
In Carnforth in my constituency, the Morecambe bay hybrid fishery order is being drafted at the moment. Can the Minister assist the legislation to go through quicker? It will enable the licensing and policing of the bay for shellfish farmers and harvesters and cockle pickers.
I am not sure that I am in a position to help with what is presumably private legislation, in that it is independent of Government processes, but I have heard what the hon. Gentleman has said. Having such an order in place would clearly benefit his constituents, which is why he has raised it today. I do not blame him for doing so.
Before that intervention, I was suggesting that in areas where the experience of GLA enforcement over the years has shown that there is less need for regulation, we can safely remove those currently licensed activities from the scope of regulation and redeploy the resources elsewhere. My Department launched a public consultation in April this year on proposed reforms to GLA operations, as the hon. Member for North East Cambridgeshire said. That consultation includes proposals to exclude some activities that currently require a licence from the scope of licensing, where evidence suggests that there is a low risk of exploitation of workers. That proposal would remove about 150 businesses from licensing, saving those businesses about £60,000 and enabling GLA resources to be deployed elsewhere to tackle serious abuses.
Changes are proposed to the size and constitution of the GLA board, to make it smaller and better able to provide clear strategic direction for the organisation. The consultation also looks at the scope to introduce civil penalties—exactly the point that the hon. Member for North East Cambridgeshire made—into the range of enforcement tools that the GLA has available.
The GLA is a designated regulator under the Regulatory Enforcement and Sanctions Act 2008—the so-called RES Act—which permits the use of civil penalties as an alternative to prosecution in certain circumstances. The point that the hon. Gentleman made, and he quite properly set out exactly why this is an obstacle for us, is that the sectors that the GLA regulates are overwhelmingly made up of small and medium-sized enterprises.
The scope for use of civil sanctions in the RES Act is constrained by Government policy in that area, and I recognise immediately that what the hon. Gentleman is asking me to do is to challenge another Department’s policy. I think that is implicit in what he says, but for the benefit of the record I want to state that Government policy in that area was clearly set out in a written statement to Parliament last November, by the Department for Business, Innovation and Skills Minister, my right hon. Friend the Member for Sevenoaks (Michael Fallon).
That statement made it clear that, in general, SMEs should not be subject to monetary fines because of the risk of smaller companies feeling less equipped to challenge the basis for such fines. That is very clear Government policy and if I wished to engage in a dialogue with my right hon. Friend the Member for Sevenoaks on the issue, we would need to establish why this matter should be the exception to that rule.
The crux of the matter is in two of the words that the Minister just said: “in general”. My colleagues on the Government Benches very much support the statement made by my right hon. Friend the Member for Sevenoaks. We understand the difficulties of the red tape, but it is this “in general”. What we are saying is that in this instance there is a distinction between the criminality of gangmasters operating against vulnerable people—the raids are revealing some horrendous and immoral issues—and the small business owner suffering from red tape. It is that distinction that I ask the Minister to take away, from a cross-departmental point of view, and take up with colleagues.
Of course I understand what the hon. Gentleman says, and I understand why he is bringing the matter forward in the context of his constituency interest, but I have to say that where there is criminality I believe that criminal sanctions should apply. I want to make it absolutely clear that, if the evidence is there, there should not be the slightest hesitation in bringing a criminal action. The question of civil sanctions is, in a sense, a reserve position for situations in which a criminal prosecution is inappropriate.
The Minister is generous in giving way a second time. The facts speak for themselves—only 15 prosecutions. For criminal prosecutions a higher standard of evidence is required, and they are therefore more difficult. They take longer and are more expensive, and we are talking about an organisation with resource constraints.
For the measure to work, the Minister needs the resource. Perhaps I can take him back to his earlier remarks. Yes, in the consultation we are reducing the board—frankly, big deal; it is pretty irrelevant—but how many investigators from the GLA are covering Cambridgeshire, Norfolk and Lincolnshire? The figures I had, off the record, were very small. Will the Minister share the figures with the House?
I am grateful to the hon. Gentleman. I do not have the figures with me and will, therefore, happily write to him to set out the position.
I will, in fact, go further than that. I am due in East Anglia tomorrow and I plan to meet with the GLA to discuss exactly how it operates and how we can help it to operate, so it seems entirely appropriate that we look at the resourcing issues. It is not small beer to redirect resources from areas where they are deployed to no great benefit because they are being used to license people who have not the slightest intention of breaking the law, and have the track record to show that they do not. It seems entirely appropriate to redirect the resource to deal with the bad guys, against whom we need to collect evidence.
I take the point about the difference between criminal and civil standards of proof. That is, of course, a factor, but let me be absolutely clear: I want more criminal prosecutions. I want to see more people brought before a court for their abuses and I want them then to suffer the further penalty, where appropriate, of proceeds of crime restitution, so that we get back the money that the gangmasters have acquired through illicit means. We also need to make it plain that they are not wanted in our agricultural industry. We must deal with them effectively.
I do not quarrel at all with the hon. Gentleman’s point, but I want to ensure that we do this right, and I am working within an overall Government policy that is resistant to the view that civil sanctions are the appropriate means of dealing with small and medium-sized businesses. That is my difficulty. It is not an insurmountable difficulty, but I need to persuade others in Government of the case.
Some provisions of the RES Act might be useful to the operation of the GLA. We have invited views from stakeholders on the usefulness of the measures, and the public consultation by the Department for Environment, Food and Rural Affairs remains open until 21 June. I therefore invite the hon. Gentleman, and others who feel strongly about the matter, to ensure that their views are fed into that consultation process. When we respond to the consultation in due course, it will be helpful for us clearly to understand, from colleagues who represent areas where many labourers work in such schemes, what the problems are and how we should best deal with them.
As I said, I am very happy to look at the matter in the round and to recognise the strength of the arguments, but I come back to my basic premise, from which I will not resile: the key change will be to redirect resources as the GLA is asking us to. That seems to make sense, but obviously we must wait for the consultation process to end to see whether others agree that we should redirect resources in the key areas of serious offences and organised crime.
The GLA itself has been at the forefront of the reform programme, and last week published its three-year strategy for protecting vulnerable workers, which emphasises an intelligence-led, risk-based approach, working closely in partnership with other agencies. The hon. Gentleman will know that the GLA is active in many parts of the country, including in the constituencies of the hon. Gentlemen here today: North East Cambridgeshire, Morecambe and Lunesdale, and Peterborough.
The hon. Member for North East Cambridgeshire mentioned Operation Pheasant, a multi-agency taskforce set up to tackle ongoing worker issues in the area. Three people have been arrested on suspicion of human trafficking offences in Wisbech, and a diverse team of agencies has been assembled to assist with the operation, with partners including Her Majesty’s Revenue and Customs, the Home Office, trading standards, Fenland district council and Cambridgeshire fire and rescue.
I want to know more about the matter at first hand, which is one of the reasons why I am going to East Anglia tomorrow to talk directly to GLA officers and partner agencies involved in the joint operation. If they tell me that there are clear areas in which we have still not dealt effectively with the issues they want us to address, the hon. Gentleman can be assured that I will act on that and take their advice in developing Government policy.
I believe that the package of reforms that we are taking forward with the GLA will make the authority better able to protect vulnerable workers, while easing burdens on the majority of businesses, which are compliant and law-abiding. I am very grateful to the hon. Gentleman for having given us the opportunity to discuss this extremely important issue.