Gangmasters (Licensing) Bill

HC Deb 21 May 2004 vol 421 cc1210-43

Bill reported, as amended in the Standing Committee.

Order for Third Reading read.

9.51 am

Jim Sheridan (West Renfrewshire) (Lab)

I beg to move, That the Bill be now read the Third time.

Back in February, I had the honour and privilege to move the Bill's Second Reading. I stood in the Chamber, in the shadow of the Morecambe bay tragedy, and asked right hon. and hon. Members on both sides of the House to support the Bill for one reason above all others—to end the exploitation of workers: the kind of exploitation that left men and women to die alone, helpless and terrified, on the sands of Morecambe bay in the name of easy money and quick profit; the kind of exploitation that has resurrected the slavery that we all thought was banished to the history books; the kind of exploitation that feeds off tax evasion, drug smuggling and human trafficking; the kind of exploitation that preys on the weak and the vulnerable; the kind of exploitation that diminishes the humanity of each and every one of us, inside and outside the House.

On Second Reading, I said that I believed it was time for legislation, not exploitation. The unanimous support that the House gave to my Bill was a clear demonstration that members of every party, from the Back Benches to the Front Benches, also believed that to be the case. That cross-party support was highlighted yet again only yesterday with the publication of the Select Committee on Environment, Food and Rural Affairs follow-up report into the role of gangmasters. The Committee stated that it now agrees that there is a need for a system of licensing and registration of gangmasters. It supports my Bill, which I deeply appreciate, and wants the Government to ensure that there is sufficient parliamentary time to get it on the statute book, with the political will and, more importantly, the resources to make it work.

My intention has always been to ensure that any law on gangmaster licensing is effective, robust and, equally important, workable. To coin a well-known advertising slogan, "I want a law that does exactly what it says on the tin." As amended, I believe that the Bill will deliver just such a law.

Before outlining how the Bill has been strengthened since Second Reading, I want to say some brief but important "thank yous". I thank the Government, both Ministers and officials, for their support and hard work in helping me to redraft the Bill. I also thank the coalition groups, from the National Farmers Union to the Transport and General Workers Union, which informed the ideas and the thinking that underpin it. The coalition is a coalition for progress. It spans workers, employers, industry, trade unions, communities and churches. Its breadth and depth are a powerful reflection of the seriousness of the problem and the Bill's merits. Last, but by no means least, I thank my parliamentary colleagues, Members from every party in the House, who have been unswerving in their support and wise in their advice.

I shall give a brief background to the Bill, as amended. The House will know that gangmasters are labour providers who operate throughout the UK economy.

The Bill is not, however, intended to bring in regulations in each and every industry. Instead, as amended, it will regulate gangmasters in the sectors in which they are most common and where the abuses of the rogue operators are at their most extreme—agriculture and horticulture, the shellfish industry and the food processing and packaging industry. That amounts to about 3,000 gangmasters employing, supplying and supervising at least 60,000 workers. Although there are gangmasters who run good, honest, decent firms, many operate at the margins of the law at best and beyond the law at worst.

Voluntary codes and self-regulation have unfortunately failed. They have failed to protect workers, legitimate gangmasters, producers, packers and retailers. They have also failed to protect the taxpayer. The absence of a law to regulate gangmasters has given the good no chance and the bad every chance. The Bill attempts to right that wrong and, as amended, I believe that that is exactly what it will do.

I shall walk the House through the key changes that have strengthened and enhanced the Bill since Second Reading. It is important that there be no rat runs through which rogue gangmasters can escape, so its scope has been widened. Not only will it apply to the whole of the UK, it will also extend to gangmasters based offshore. The work to which the Bill applies has been defined in broad terms to ensure that rogue gangmasters cannot evade the law by redefining the nature of the work that they do. The Bill now covers all forms of sub-contracting. In addition, employment agencies and employment businesses will come within its ambit if they are engaged in activities for which a gangmaster licence is required.

I come now to the definition of a "worker". Although they are often the most vulnerable to exploitation, migrant workers do not make up the majority of those employed, recruited and supplied by gangmasters. In fact, it is estimated that some 70 per cent. of those involved with gangmasters are indigenous workers. But British or foreign, migrant or indigenous, legal or illegal, a worker is a worker is a worker, and no worker should ever be abandoned by the law and left to be a victim of exploitation. Through an amendment that defines a worker as an individual who does work to which this Act applies the Bill now offers the full protection of the law to every worker.

Anne Picking (East Lothian) (Lab)

I thank my hon. Friend for giving way. He is to be congratulated on this important Bill having reached this stage. He said that a worker is a worker is a worker. Is he aware of a situation in my constituency, where a third party employs migrant workers at a mushroom farm to work excessively long hours, sometimes 60 or 70 a week, thereby pushing out the local work force who cannot compete with those people? That means that workers are being exploited, no matter where they are based or where they come from, which has to be absolutely wrong.

Jim Sheridan

My hon. Friend makes a perfectly valid point. I know that she has worked extremely hard to tackle problems that she has identified in mushroom factories in her constituency. That is a classic case—and tangible evidence, if it were needed—of workers, in this case migrants, being exploited, having been offered terrible wages and conditions, in many cases without any accommodation. The net result, as my hon. Friend made clear, is that indigenous workers lose out on jobs because they cannot compete with people who are being paid poverty wages. A fundamental reason for introducing the Bill is to stop that exploitation of migrant workers and protect our indigenous workers, such as those in East Lothian, and that is exactly what the Bill will do. My hon. Friend is to be congratulated on the work that she has done behind the scenes, letting the authorities know what is going on.

I want to deal with the regulations and the powers of the Secretary of State. To ensure that the net is cast just wide enough to capture only those that it is intended to capture, the Bill gives the Secretary of State the power to make regulations concerning the exclusion from, or inclusion in, its provisions of certain types of work. Members will see that, as amended, the Bill also sets out the requirements for regulations that may be made by the Secretary of State through statutory instruments on matters such as the status and constitution of the licensing authority, the circumstances in which a licence may not be required, the licence appeals system and the "reasonable steps" defence for users of unlicensed gangmasters. When he rises to speak, I am sure that my right hon. Friend the Minister will confirm that all the regulations will be made in accordance with current Government practice on the use of delegated powers, including a full and proper consultation process at every stage, which is vital.

The Bill will establish a gangmasters licensing authority, which will be a non-departmental public body sponsored by the Department for Environment, Food and Rural Affairs. It will consist of key industry stakeholders and representatives from the Government, the police and enforcement agencies. It will set out the licence conditions after the fullest consultation with stakeholders. It will process licence applications, set and collect licence fees and establish a public register of licensed gangmasters. It will also have the power to modify, suspend and, where necessary, revoke licences, and it will run a licence appeals system, which is crucial. It will proactively enforce licence conditions. The authority will also be able to investigate and enforce the arrestable offences created by the Bill. I shall deal with those important offences in a moment.

The authority will play a pivotal role in bringing about the culture change needed to drive out the rogues, support the law-abiding and protect the vulnerable. Its fundamental strength lies in the four pillars on which it is built. The first is the skills, experience and expertise of the industry stakeholders who will make up its board and, through their experience, guide the board through its work. The second pillar is the enforcement link that the authority will provide between key Departments, local government, the police and existing enforcement agencies, such as the Health and Safety Executive and the Inland Revenue. The third pillar is the political commitment and financial support from the sponsoring Department, DEFRA, for which we are deeply appreciative. The fourth pillar is the authority's democratic accountability to Parliament, through DEFRA and the Secretary of State, who will be required to make an annual report to Parliament on its operation and, indeed, its effectiveness.

I return to the offences created by the Bill. It is right and proper that those who break the law should be brought to justice. The Bill, in its amended form, will make sure that that happens. However, prevention is always better than cure, so to provide an effective deterrent to rogue operators, the Bill will establish the criminal offences of operating as a gangmaster without a licence, obtaining or possessing a false licence, using an unlicensed gangmaster and obstructing an enforcement officer. Members will know that the illegal activities of some rogue gangmasters have been so serious that they have come under investigation by the National Criminal Intelligence Service.

The Bill now reflects the need seriously to tackle the crime with serious sanctions. It therefore amends the Police and Criminal Evidence Act 1984 to make operating without a licence and possession of a false licence arrestable offences. It also amends the Proceeds of Crime Act 2002 to ensure that the assets of convicted gangmasters can and will be confiscated. The Bill now has added deterrent value for the arrestable offences of operating without a licence and using a false licence, as it includes sentences for repeat offenders: up to two years' imprisonment for a second offence and up to 10 years' imprisonment for a third offence.

I shall now move on to what some Members rightly regard as the most important part of the Bill—the part that deals with enforcement. From the moment I introduced the Bill, I have argued that the key to the success of the licensing and registration scheme lies in the effectiveness of the enforcement that backs it up. To be effective, enforcement must be based on three crucial principles. First, it must be co-ordinated: rogue operators and their abuses cannot be allowed to disappear into gaps between Departments and enforcement agencies. Secondly, it must be properly resourced: the price of doing nothing always outweighs the cost of enforcing the law. Thirdly, it must be proactive: it cannot rely on whistleblowing by workers who are often too terrified to blow the whistle in the first place.

In my view, the amended Bill enshrines those key principles; for example, the licensing authority will act like a buckle on a belt, pulling together the enforcement efforts and expertise of key players such as DEFRA, the Department for Work and Pensions, the Home Office, the police, the Health and Safety Executive and the Inland Revenue. The authority will also be capable of carrying out proactive investigations. Income from the licence fees, in addition to the financial underpinning provided by DEFRA, should ensure that it has the right resources to do the job.

Mr. Peter Luff (Mid-Worcestershire) (Con)

The hon. Gentleman mentions licence fees. He knows that I support the principle of the Bill, but I am concerned about the costs that could be imposed on legitimate gangmasters. What does he think the fee will be, and does he think that setting it too high will encourage unlicensed activity to continue?

Jim Sheridan

I thank the hon. Gentleman for that intervention. It is crucial that farmers, in particular, know the cost of the licence, but I remind him that the industry itself will set the licence fee, and it is hard to imagine it overburdening itself by setting the cost too high. Secondly, estimates of the cost suggest that it should not have a detrimental impact on labour providers. It is estimated—I stress that these are only estimates—that the fee for a three-year licence will be between £1,750 and £2,250, or between Σ585 and £750 a year. I do not think that such costs would put farmers out of business, and farmers themselves have said that the licence will produce a level playing field for them and their businesses.

The Bill opens gateways between Departments, the licensing authority and other enforcement agencies to facilitate the exchange of enforcement information and best practice. It also gives the Secretary of State the power to appoint enforcement officers, and gives those officers powers to enter premises, to search premises, to take possession of any item from those premises, to require the production of all relevant records, to inspect and take away the records, if necessary, and to order the attendance of persons. The Bill also provides enforcement officers and police officers with the power to make arrests in this respect.

Rogue gangmasters in agriculture, the shellfish industry and food processing and packaging are exploiting workers, undercutting good labour providers and engaging in serious criminal activity. The purpose behind the Bill has always been to construct the architecture necessary to end exploitation and to establish the legal paper trail that will bring rogue operators to justice and, I hope, drive them out of business. Farmers, packers, producers, supermarkets, Churches, workers, trade unions, employers, community groups, legitimate gangmasters, the Government, the Environment, Food and Rural Affairs Committee and right hon. and hon. Members on both sides of the House all say with one voice that it is time to legislate, time to establish a statutory licence and a register, and time to end the exploitation. That broad coalition of support has played its part in informing, shaping and amending the Bill into the form in which it once again comes before the House today.

I have always wanted a Bill that was robust, effective and workable. I genuinely believe that, as amended, the Bill is precisely that. It now sets up a licensing authority that combines industry expertise with Government support and democratic accountability. The Bill also now has the scope and flexibility to close any loopholes through which rogue gangmasters might seek to escape, it reaches out to each and every worker throughout the UK, and it provides the framework for an enforcement structure that has both the strength and the flexibility to deter, to detect and to protect.

The House can never lay claim to the making of perfect law, but we can make good law—law that works, law that serves and protects, law that changes our communities, our country and our lives for the better. With the utmost sincerity and conviction, I say that, as amended, the Bill is an opportunity to make just such a law.

10.16 am

Mr. Peter Luff (Mid-Worcestershire) (Con)

I congratulate the hon. Member for West Renfrewshire (Jim Sheridan) both on introducing the Bill and on the manner in which he has just moved Third Reading. The agriculture industries of the UK owe him a great debt.

Although a member of the Standing Committee, I graced it with my presence for only a few minutes. It is matter of some regret to me that it sat on a Wednesday afternoon; I had expected it to sit on a Wednesday morning, a series of which I kept free in order to play a full and active part in its deliberations. However, there seems to have been some discussion with the Minister for Rural Affairs and Local Environmental Quality about when the Bill would be ready for Committee, which indicated an afternoon sitting. That prevented several of my right hon. and hon. Friends and me from participating, even though we had wanted to contribute to work on the Bill. None the less, a clearly satisfactory Bill has emerged from the Committee, whose members I congratulate on their deliberations. Incidentally, I hope that no precedent has been set for the timing of Standing Committees on private Members' Bills—to have them sit on Wednesday mornings enables us to plan our very crowded diaries.

The hon. Gentleman mentioned whistleblowers, and I pay tribute to Zad Padda, my constituent as a company, Fusion Personnel, if not as a resident—he lives in Birmingham. He has played a leading role in bringing the issue to public attention and has put his personal security at some risk by taking such a high profile—[Interruption.]

Mr. Deputy Speaker (Sir Michael Lord)

Order. We cannot have hon. Members making their speeches to music.

Mr. Luff

I am sorry about that, Mr. Deputy Speaker. At least it makes a change from the more mundane ringtone that we hear in cinemas when we are warned about the same peril. It will not happen again"although it is a good tune.

Zad Padda has put his life in some jeopardy by taking such a high profile, and I have had to ask my local police force to keep a close eye on his security. The world that we are discussing today is pretty murky, and some of those whose lives the Bill will make a great deal more difficult will not welcome what he has done. Zad Padda came to my constituency surgery two or three years ago, and he is the only person so far to have brought a PowerPoint presentation to one of my surgeries. I was so impressed by what he showed and told me about the work of gangmasters and how they could be better regulated and controlled that I asked Lord Whitty to meet him. You and I know, Mr. Deputy Speaker, that the convention is that a Minister gives about half an hour to such a meeting. In fact, Lord Whitty spent an hour and a half or even two hours with Zad Padda, which I think is a measure of the noble Lord's interest in the issue. It is therefore fair to pay tribute to Lord Whitty, too. I know that the Minister for Rural Affairs and Local Environmental Quality has done the bulk of the work in the House of Commons, but the noble Lord has been concerned about gangmasters for some time. I might say—this is perhaps a more partisan note—that perhaps his concern seems rather higher than that of some other Departments, and it would be good to see the same commitment from them.

My concern about the Bill, which I support and will not vote against, is simply that the Government should not say, "We've got the Bill on the statute book. We can tick the box—job done." I regard the Bill simply as another brick in the wall of providing proper and better protection for workers and all the other benefits that will flow from a more effective system of control. The Bill is not the answer in itself.

I suspect that another hon. Member may want to comment on this is more detail later, but it is not at all clear to me that the Morecambe bay tragedy would have been prevented simply by the Bill. A much more comprehensive approach to the problem than just the Bill is required. The Bill is a useful contribution, but not the sole answer.

It is certainly not clear to me that the incident that provided me with my own personal wake-up call last July would have been prevented. You, Mr. Deputy Speaker, may recall that one Monday I was travelling on a train towards Evesham, on the way to London and the House of Commons, when it was involved in a tragic collision with a white minibus on a level crossing at Charlton. As a result of that awful accident, three agricultural workers were killed. Soran Karim, a 23-year-old Iraqi, Satish Kumar from India and Islam Uddin Ahmed from Bangladesh were all victims of the accident. They were being driven by an Iraqi asylum seeker, Adnan Kadir Karim, who earlier this week received a five-year prison sentence for their manslaughter. Our hearts go out to all the families left behind as a result of that tragic incident. I warned the Government then, both publicly and privately, that that was an example of what happens when unlicensed workers, improperly trained and improperly warned of the dangers involved in an activity, are allowed to continue working unchecked on the fields of Worcestershire. Their deaths should have been the wake-up call that prompted rather earlier action.

We learned a lot from the court case. I have not yet seen the full proceedings—I am relying on press reports of the proceedings — but I am concerned that the Bill would not have prevented that tragedy. As far as I can tell, Karim was operating as a freelance gangmaster, going around cafés and restaurants in Birmingham, picking up people who wanted casual labour and driving them to the fields of Evesham to offer them and himself as employees: whether he was a gangmaster and whether it would have been apparent to a farmer that he was a gangmaster are interesting questions. I suspect that the Minister may tell me that, technically, under the terms of the Bill, Karim would have been deemed to be acting as a gangmaster. However, if a gang of four friends, colleagues, turn up casually on a farmer's fields and say, "Employ the four of us. We'll take what you give us", will they be caught by the Bill?

The Minister for Rural Affairs and Local Environmental Quality (Alun Michael)

I may be able to assist the hon. Gentleman. We do not want to leave any doubt in these matters. As my hon. Friend the Member for West Renfrewshire (Jim Sheridan) indicated, the Bill has been drafted and amended in Committee to make its provisions wide and ensure that all people who act as gangmasters—whether in a small way as subcontractors, or any other way—are caught by it. The Bill's powers of exclusion have been drafted to be clear that people in the business that the hon. Gentleman describes are caught and cannot avoid the provisions.

Mr. Luff

I am grateful to the Minister for that assurance, and he may well be right in that particular case. Another company in my constituency employs a lot of immigrant casual labour, without using gangmasters. It is said that the people just turn up and ask for jobs. It is a reputable company. I have visited it many times. I have seen the conditions in which people work. I know the rates of pay. It is a good company, but it strikes me that other companies that operate in the packing business might well claim that they operate in that way, while having informal arrangements with gangmasters. Even if they do not and the word goes around that a firm is a good company to work for or someone is a good farmer to pick for, people may be exploited by the farmer or the company without a gangmaster being involved.

I am sure that the Bill will not end the exploitation of agricultural workers. It should deal with the gangmaster issue, but it will not end all the problems involved in those industries. It is very important that the Government do not use the Bill as an excuse to play down the other enforcement activities in which they need to be involved. That is the key message of the EFRA Committee report on gangmasters. We are grateful to the Committee for producing its very important report. The Committee"s original report showed that it was not convinced by the need for the Bill and thought that better enforcement was all that was required. That is a fair paraphrase of its original report.

The EFRA Committee's new report, published yesterday morning, makes it clear that it is now persuaded that the Bill is necessary and that it supports its principles, but that it is just not enough on its own. That very clear message comes through from reading the report. It refers to the hon. Member for Morecambe and Lunesdale (Geraldine Smith) and talks about her concern that enforcement continues to be held back to an extent by a lack of resources and an absence of co-ordination. That will still need to be addressed, whether or not the Bill reaches the statute book, as I am sure it will.

The EFRA Committee report says: A plethora of cross-departmental and inter-agency committees, forums, steering groups, working groups and co-ordination groups have been set up, each of which addresses aspects of the problem, or which have wider responsibilities for illegal working… The Illegal Working Steering Group… chaired by a Minister of State in the Home Office… The Informal Economy Steering Group… chaired by the Inland Revenue… The Informal Economy Working Group… chaired by Customs and Excise… The Gangmaster Co-ordination Group…chaired by a Defra official… Regional gangmaster for a… The Department for Work and Pensions are responsible for the fora… The Department for Work and Pensions Fraud Steering Group, chaired by a Minister from the Department… enforcement activity is co-ordinated through Reflex… chaired by the National Crime Squad. There is still a very complex enforcement framework, and the Government need to do much more to bring it together.

It is rather sad that one cannot verbalise the picture—that would be rather jolly—but it is entitled "Architecture of Government activity against illegal working". That is figure 1 of the report, which may reassure some people, but its sheer complexity rather alarms me.[Interruption.] I think that the Minister is indicating that he is a little concerned about its complexity as well, but it is a very pretty picture.

The EFRA Committee now accepts that registration is necessary, but it raises several concerns, which I share. We have already discussed the cost. I am grateful to the hon. Member for West Renfrewshire for what he said on the cost. At that level, it should not be a problem. Clearly, it is affordable—it is not a big issue—but if the cost becomes significantly higher than that, it may have an adverse affect. So the House will have to consider that issue very carefully, as the authority reports its work to the House, under its requirement in the Bill. However, there are two other concerns.

This is the kind of Bill that I instinctively do not like because all the detail is provided in secondary legislation. This is a running theme of mine in considering legislation. The Bill's detail will almost all come from statutory instruments. It contains enabling powers. Obviously, we have the Government's assurances—they count for a lot—but I would love to see more stated in the Bill about exactly what the gangmaster licensing authority will be expected to consider when issuing licences. For example, the issue in the accident in which I was involved last July was not only whether those people would be exploited because they would be underpaid, but that they were driving illegally. As far as I can tell, the minibus was not insured and the driver did not have an English driving licence. He could not even read English road signs, which is probably why the accident occurred: as he crossed the unmanned crossing, he did not know what to do. A licence condition ought to be that gangmasters can demonstrate that those who drive their minibuses all have driving licences and are fully insured.

Alun Michael

I am grateful to the hon. Gentleman for giving way, because it is important to put on record the way in which the Bill's architecture has been designed. It is virtually impossible for hon. Members to anticipate everything that could go wrong. Indeed, some of the hon. Gentleman's remarks illustrate precisely that point. As my hon. Friend the Member for West Renfrewshire (Jim Sheridan) said in his introduction, the two elements that enable the Bill correctly to target the real problem are, first, the engagement of the industry, given that those who know the business know what is happening on the ground, and, secondly, the fact that the provisions will be dealt with by statutory instrument, allowing them to be fine tuned if new ways to evade the law or the intentions of the Bill are found. So the hon. Gentleman is right to raises those issues, but the Bill's architecture is designed precisely to deal with them. I gave undertakings in Committee to the effect that we intend to indicate in advance of the Bill's enactment how the secondary legislation should be used.

Mr. Luff

That is helpful. Obviously, there is always a trade-off between clarity in primary legislation and flexibility in the operation of the legislation, particularly in fast-moving environments. I accept that, but perhaps it would have been possible to be rather more forthcoming in the Bill without prejudicing that flexibility. The Minister's assurance is appreciated, and I hope that the authority will be encouraged to examine the issue of driving licences and insurance.

The hon. Member for West Renfrewshire spoke about the responsibility of the supermarkets, which is important. Making sure that the industries operate ethically is not just the job of Government—a job that, as the report shows, has not been done adequately by successive Governments. It is also the job of the private sector. Price competition among our major supermarkets is leading them to turn a blind eye to what is happening as their food is prepared for them. One could say literally, in the wake of Morecambe bay and the Charlton crash, that there is blood on much supermarket food.

To their great credit, some supermarkets are trying to do something about the situation. Wychavon district council, which produced a report on issues relating to food processing in the Vale of Evesham, sought the advice of supermarkets. One supermarket, Asda, was happy to offer a great deal of advice. On the face of it, it seems that Asda is trying to do something about the problem, but I am worried that the other supermarkets are not. The British consumer needs to understand that she or he is often paying a heavy price for the very low prices of agricultural products. As part of an ethical trading initiative, the supermarkets must act to reassure themselves that they are genuinely using ethical labour at every stage of the production chain. The Bill, welcome though it is, will not solve that problem either, unless the private sector—the supermarkets—get a better grip of the situation.

I shall draw my remarks to a conclusion—I have already gone on longer than I intended. There is a parallel in legislation that might have been a better model for the Bill—the Private Security Industry Act 2001—which meets some of the objections that I raised with the Minister in respect of flexibility and clarity. But we are where we are, and the Bill is the only measure we have. It will improve the situation considerably and will be welcomed by all reputable gangmasters. Sadly, it seems that they are a dwindling band.

We can be fairly confident that the Bill will make a significant contribution to preventing the exploitation of labour. That is the key point for me. When I was commenting on some of these issues at the time of the accident, some people mischievously interpreted my remarks as racism—a criticism of the person driving the minibus. Not at all—my criticism was of the fact that the people involved were being exploited. They were the victims of what happened, and I was extremely sorry about what happened to them. The problems suffered by such victims are often more concealed than that—for example, the poor housing conditions in which many of them live, the appallingly low wages they are paid and the risk at which they are put.

Those are issues that the Bill should address. It should secure a vital service for agriculture. The word "gangmaster" has unpleasant connotations. It does not sound very nice. We need to put it on record that the casual foreign labour working in British fields and British packhouses is crucial to the success of those industries. We should thank those foreign labourers for the contribution they make to the success of our agricultural and horticultural industries. We should be grateful to them and look after them properly. We should ensure the safety of the general public, we should guarantee tax revenues, we should prevent abuses of immigrants and we should ensure that the law of the land is better upheld than it has been. The Bill is not a panacea, but it is a useful step in the right direction and I welcome it.

10.33 am

Geraldine Smith (Morecambe and Lunesdale) (Lab)

I welcome the Bill and am delighted to be in the Chamber to see it go to Report and Third Reading. I congratulate my hon. Friend the Member for West Renfrewshire (Jim Sheridan) on all his hard work and his foresight in bringing the Bill before the Commons even before the Morecambe bay tragedy. I also congratulate the Bishop of Lancaster, who has pushed hard for a gangmasters Bill. He behaved magnificently after the Morecambe bay tragedy and conducted a multi-faith service in the cathedral.

I thank the Government for acting so swiftly to assist the passage of the through Parliament and agreeing to give it parliamentary time if necessary. I thank all hon. Members for the support they gave me after the Morecambe bay tragedy and for the support they have given the Bill. It has been a fine example of Parliament working well and Members of all parties working hard together.

It is true that the Bill is a small step in the right direction, but it is not a panacea. It probably would not have prevented the Morecambe bay tragedy. To be honest, I do not know what would have done. How could one have stopped people going out in the darkness in the middle of Morecambe bay, even if there had been double the number of enforcement officers and ample regulation? There were people operating outside the law, and I hope that the police investigation will bring some people to justice if it is proved that serious exploitation was taking place.

The Morecambe bay tragedy brought the issue of gangmasters to the fore. Last Thursday I attended a service down on the beach. It was 100 days since the tragedy occurred and the Chinese tradition is to hold a service. I met up again with many local people who had been involved in the tragedy. What an impact it had had on their lives—for example, on the local lifeboat crews. One of the young men who had recovered some of the bodies is still having nightmares, seeing Chinese people in his dreams. The local chief superintendent, Wendy Walker, is a credit to the local police force. She behaved so well following the tragedy, but it still plays on her mind because she went into the morgue and saw 20 young people with not a mark on their bodies—20 people who should not have been dead and who were probably dead as a result of exploitation.

There was not just a human cost. We are faced with a police bill of £1 million to date, and the investigation continues. I put it on record in Parliament that I should like to see the Government pick up the cost of that. They have been helpful and given a grant of £200,000, but Morecambe bay was a national tragedy and it should not be the people of Morecambe who suffer in their policing and have to foot that bill. I appeal for more help in paying the bill.

The issue of exploitation was brought to my attention after the Morecambe bay tragedy because I met so many people who had so many horrendous tales to tell me about how people were being exploited right across agriculture—often illegal immigrants, but not always. Quite often British people were suffering terrible exploitation. We heard one example today of a mushroom factory where exploitation was taking place. I have heard of a similar factory in my area where local people are being put out of work because the owners are trying to get cheaper foreign labour. It seems that there is probably exploitation taking place there.

It is clear that we need measures to address the problems. The Bill will be helpful. It will produce a public register so we will know how many gangmasters are operating in this country. We must be careful. A gangmaster is just a supplier of labour and there are some good, reputable gangmasters operating. Those gangmasters have suffered as a result of unscrupulous people undercutting them by employing, slave labour. The Bill should help to deal with that.

As has been said, there is a need for joined-up government. Let us be honest—that is easier said than done. It is difficult for any Government. Government works in Departments and it is hard for those Departments to liaise and work closely together at times. The tragedy in Morecambe bay and other events that hon. Members have highlighted show the need for Departments to work together.

We still have issues to deal with in Morecambe bay. Agencies have worked much better together since the tragedy. The Department for Work and Pensions, the Inland Revenue and various other Departments have got together and reviewed multi-agency operations. They are looking closely at the situation. The immigration service has acted well since the tragedy, carrying out a number of raids in my constituency and taking what I consider at this stage to be satisfactory action. But problems remain. I have heard that last week up to 80 Chinese people were working on the northern side of the bay at 11.30 at night in dangerous conditions, so clearly more remains to be done.

Enforcement is important. This is a good Bill if it has teeth, and that will be the key to its success. We are talking not just about foreign workers, but about young British people. I have seen young British lads, 16 and 17-year-olds, out in Morecambe bay working for gangmasters, who are often not aware of some of the dangers of the bay, and I am sure that the same applies throughout the agriculture sector.

The events at Morecambe bay shocked and shamed the nation. At least 21 young lives were lost. A body was found only two weeks ago, and we hear that two bodies are probably still out there in the bay. People were shocked and saddened that such practices could occur in the 21st century, with people living in overcrowded conditions, 20 to a small flat, exploited, transported in rundown vehicles that were not even taxed and just left in the middle of a bay to die in freezing cold, icy waters in the darkness.

We want to ensure that those lives that were lost were not wasted. I thank my hon. Friend the Member for West Renfrewshire for making sure that those lives were not wasted. His Bill will be a tribute to them and will help to prevent other vulnerable workers from being exploited in the same way.

As I have said, the Bill is not a panacea, but it is a step in the right direction and I welcome it.

10.41 am

Dr. John Pugh (Southport) (LD)

It is a privilege to follow hon. Members who have done such exemplary work in furthering such a good and potentially promising piece of legislation. Its target is largely the illegal gangmasters, or gangsters—shadowy criminals, exploitative people who engage in trafficking and abuse every piece of employment and housing legislation going. But I hope that within the Bill's ambit comes another group of people who call themselves agencies rather than gangmasters. Their names often appear in telephone directories and they advertise in newspapers, and they too house, deliver, tout for and organise a work force. Some could be described as borderline legal. Some have been prosecuted, some are rather easily satisfied with false identities, and some turn a blind eye to almost every health and safety regulation known. In addition, they often house the people who work for them in circumstances that violate all the regulations for houses in multiple occupation. That creates a problem throughout the country.

Those agencies fundamentally provide a legal get-out for legitimate employers in all sorts of areas, including agriculture, building, catering, packing and industry. They are their alibi against whatever legislation the Government may wish to introduce in order to enforce decent labour relations.

I very much favour the Bill, but like previous speakers I wonder what the eventual statutory instruments will look like and how the measures will be enforced. It is important that they be effective, not only against the gangsters, at whom the law can throw sufficient ammunition anyway, but to some extent at those people who regard themselves as working properly but who breach a good number of regulations in the process. If legislation—

Alun Michael

If the hon. Gentleman is talking about organisations or individuals that operate within the legislation for registering employment agencies, I should make it clear that where they act as a gangmaster they are covered by the Bill. Obviously, people using a particular name can seek to avoid the law, but they would not be able to put themselves outside the legislation by the simple use of a term, or by using other legislation in order to try to avoid the Bill's application.

Dr. Pugh

I am grateful for that assurance and all the other assurances that the Minister has given so far. The principle of the Bill is entirely sound, but the ultimate test will be its enforcement and the statutory instruments that follow, which we look forward to receiving.

10.44 am

Mr. Frank Dobson (Holborn and St. Pancras) (Lab)

I welcome the Bill, which is long overdue. I sincerely congratulate my hon. Friend the Member for West Renfrewshire (Jim Sheridan) on introducing it and on all his work in preparing it and in the discussions that have taken place since Second Reading. It deals with what has been a growing problem, at the heart of which has been the exploitation of vulnerable workers receiving extremely low pay, working in poor conditions, facing excessive charges for their travel arrangements—which, as the hon. Member for Mid-Worcestershire (Mr. Luff) pointed out, have frequently been dangerous—without proper insurance cover, often being charged ferocious rates for protective clothing and so on, and often living in very poor accommodation supplied by the gangmaster at vast expense, so that while their notional pay may have been low, their take-home pay dwindled into virtual non-existence because of the deductions for travel, accommodation and clothing.

It is also worth emphasising that not only was the vulnerable work force being exploited, but the taxpayer was being swindled left, right and centre. The Inland Revenue was not receiving the money that it should have been. Contributions were not being made towards pensions and other requirements of the Department for Work and Pensions, and you can bet your boots that VAT was not being paid. There have also been rising costs to the national health service. Because of the poor health and safety conditions, people were falling sick and being injured in a way that they would not have been if they had been properly employed by decent people.

The Bill is the product of legitimate concern that has been building up over a long period; it has not just occurred now. I recall time and again listening to Dick Body on the Tory Benches and Joan Maynard on the Labour Benches, a joint attack by two people who probably did not agree on anything else on earth other than their dislike of the gangmaster system. Dick will probably be pleased by it, because he is still in the land of the living, and Joan Maynard would have been very pleased had she still been around to see it.

That was all years ago, then my hon. Friend introduced this Bill and then there were the awful events in Morecambe bay. I pay tribute to my hon. Friend the Member for Morecambe and Lunesdale (Geraldine Smith), who, I confess, is a friend of mine. She had been exercising foresight and forewarning of the problems in Morecambe bay for a long time, but proper notice was not taken of what she was saying, and she found herself in the awful circumstances of being able to say "I told you so" after a tragedy, which was not something that she had looked forward to. She is still working hard and still drawing attention to shortcomings that might make it possible for such an event to occur again, in Morecambe bay or elsewhere.

One of the problems in the past, highlighted by the recent Select Committee report to which the hon. Member for Mid-Worcestershire referred, concerns the co-ordination of the raids—if that is the right way to describe them—involving the police, the Inland Revenue, and sometimes the immigration service, the Departments for Work and Pensions and for Environment, Food and Rural Affairs, the Health and Safety Executive, and so on. As I understand it, one of the Bill's benefits will be that there will not be the necessity to co-ordinate raids in quite the same way. If there is a raid and someone is lifted, they can be arrested on the spot and taken to a police station. At that point, it should not be beyond the wit of anybody to get in touch with the proper people at the Inland Revenue, the Department for Work and Pensions, the immigration service, the police, the Department for Environment, Food and Rural Affairs or the Health and Safety Executive so that the full weight of every possible law comes down upon the offender.

Co-ordination will be made much easier by the Bill, which will be welcomed by all decent, law-abiding people. It is certainly welcomed by the law-abiding and decent suppliers of labour in the rather peculiar markets involved, and it is welcomed by the National Farmers Union, the Transport and General Workers Union and the major retailers.

Generally speaking, I agree with the hon. Member for Mid-Worcestershire in wanting the detail of the legislation to be included in the primary legislation. In these circumstances, however, there are good grounds for saying that much of that detail needs to be set out in regulations. If it were included in an Act of Parliament, it would probably take a great deal of time and effort to get any Government to make an appropriate amendment to that Act. We are dealing with some vile, villainous and ingenious people, so the fact that the detailed control of true regulation can be amended relatively quickly and easily in response to their latest ingenious villainy makes a good case for using the regulatory system.

I represent Chalk Farm and various other such places—Holborn and St. Pancras is not a very agricultural or even horticultural area—and while the Bill covers agricultural and horticultural work, shellfish gathering and the processing or packing of any products derived from those industries and sectors, I wish to point out that there are other areas where gangmasters operate. Some of them are equally villainous in cleaning, the building trades and further stages of food preparation, which I do not think that the Bill necessarily covers. We can pat ourselves on the back about the Bill, but we cannot say that we have dealt with everything. It is right that the Bill deals only with the limited area that we have been discussing, but there are other issues, and we cannot think that we have dealt with the whole problem of gangmasters because we have tried to deal with a particular aspect.

None the less, this is a good day, and it is the product of a lot hard work by Members of Parliament and officials. I congratulate my right hon. Friend the Minister on organising the process as he has done. His officials have had a number of meetings with the various interest groups, and he and they have also had meetings with the all-party membership of the Committee outside the Committee's proceedings, in which we managed to identify practical problems and come up with answers that dealt with them as far as we could see. There has been an interchange of ideas to meet a common and decent objective. It has been a good and productive process, and I congratulate him on his approach, which has been immensely helpful, as I think everyone who has been involved in the process would agree.

After the law is passed, it needs to be implemented. As I said, I think that it will make it easier to co-ordinate the activity of the various supervisory bodies, but a great deal of hard work and effort will be needed and the various Departments will have to give the matter higher priority than they have been doing in practice until now if the Bill is to achieve what we want. We will also have to ensure that resources are available to back up the practicalities in the field. For all the good that the various working parties and such like are doing—and it may be very good work—what really counts is what happens on the ground, as I said in one of the meetings; it was a fairly chilly one at six o'clock in the morning in a pea field in Lincolnshire. We have got to get that sorted, and I think that the Bill goes a long way towards doing that. There will be further consultation about the regulations, involving the Transport and General Workers Union, which has done a great deal of work on the matter, as well as other organisations, including the National Farmers Union, which has been extremely co-operative.

As my hon. Friend the Member for Morecambe and Lunesdale said, the problem does not apply only to foreign workers. In fact, the majority of the people who have been awfully exploited are our own fellow citizens. An end to the exploitation of people who are in this country for a brief period, but who might want to stay longer, and of our fellow citizens is a good thing and a step forward.

The cost to a farmer and the ultimate cost to retailers and the rest of us of paying decent wages and ensuring that people work in decent conditions is an increase in the cost of the final product. We must recognise that, if we are going to ensure that people are decently treated when they are working to provide food for us, it may cost us a few more pence on our grocery bill, but that paying those few more pence is absolutely right if we are to bring about improved working conditions and get rid of the scandalous working conditions that some gangmasters—not the decent ones—have visited upon some of the most vulnerable people in our country. We may have to pay a little bit more to live in a better society, but I think that most people would agree that it will be well worth it.

10.57 am

Mr. Roger Williams (Brecon and Radnorshire) (LD)

My hon. Friends and I very much welcome the Bill. I pay tribute to the hon. Member for West Renfrewshire (Jim Sheridan) for the work that he has done. The skill and determination that are needed to take a private Member's Bill through the House must never be underestimated. It has never fallen to me to do so, but I am told that it dominates a great deal of one's time, including parliamentary time.

I first became aware of the gangmaster system when I was doing some missionary work in East Anglia in the 1960s and 1970s. We were picked up after the children left for school and brought back home just before they arrived back. I am probably looking at what happened through rose-tinted spectacles 30 or 40 years on, but it seemed like a family-friendly system. I guess the same abuses were happening then, but that they were not so readily identifiable and that attention was not drawn to them.

The system and the market supply chain have changed incredibly. There is now a huge demand to deliver fresh products on to the table in a matter of hours rather than days. In the light of the domination of the limited number of supermarkets that have such a huge influence on the supply chain and prices, and their basic determination to compete on price, it is clear that the gangmasters in question and the abuses that have been identified are a symptom of that system. As a number of hon. Members have said, if we are going to address the issue, supermarkets must take some responsibility for the ethical considerations in deciding how a code should be produced. It is all very well for them to make great play of welfare conditions in respect of a chicken product produced in a foreign country, but it also behoves them to look after the welfare of the workers who have been involved in supplying that food. In warm weather, demand for salad increases, and farmers are asked at short notice to increase production and get more product to the supermarket shelves. The gangmaster system often breaks down during such stressful periods, which ill serves the people whom it employs.

Assuming that the Bill is enacted and becomes part of the legislative framework, how will 3,000 gangmasters apply for and obtain licences? We want to encourage gangmasters into the system, and we do not want people making excuses by claiming that the system could not cope with their applications. Will a system of temporary licences be set up while the inspections and investigations take place to ensure that gangmasters meet the requirements of the licensing system?

The Environment, Food and Rural Affairs Committee report criticised the Government for not being able to establish the number of gangmasters and employees affected by the Bill. The hon. Member for West Renfrewshire (Jim Sheridan) mentioned 3,000 gangmasters, and I am sure he has the evidence to substantiate that figure, but a huge amount of work remains. We must set up an inclusive system, because the last thing that we want is gangmasters to exist outside the system—we want them inside it. The Select Committee report also pointed out that some gangmasters have co-operated voluntarily with the Department for Environment, Food and Rural Affairs. Because those gangmasters have volunteered to take part in the scheme, they presumably feel that they comply with the legislation.

I recently visited St. Merryn Meat, which lies just outside my constituency in Merthyr. It employs 1,000 people, and produces 70 per cent. of the meat for Tesco. On a daily basis, it also employs 100 Portuguese workers, who are supplied by an employment agency. When I attended the briefing held by the hon. Member for West Renfrewshire (Jim Sheridan), I asked whether those people and the agency that supplies them would be covered by the gangmaster legislation, and was assured that that agency must register. Perhaps the Minister will update us on whether the Bill covers such work.

Many tributes have been paid to the hon. Member for Morecambe and Lunesdale (Geraldine Smith). None of us wants a tragedy to occur in our constituency. The hon. Lady has dealt with the matter with dignity and determination, and brought the issues to the Government's attention. Hopefully, her work will make it less likely that such disasters will happen in the future.

Police criminal intelligence tells me that people traffickers also traffic drugs and evade excise on alcohol and tobacco. Those people form a criminal fraternity, and the more we can do to break its back, the better. If the Bill does just a small amount to achieve that objective, not only will it have improved the working conditions of up to 60,000 people in this country, but it will produce a big stick with which to attack the criminal fraternity which brings this country's reputation down.

We support the Bill for all those reasons. A wide range of people have co-operated with the hon. Member for West Renfrewshire. The National Farmers Union, the Transport and General Workers Union and others attended your briefing, which shows the hard work that you have put in.

Mr. Deputy Speaker

Order. May I gently remind the hon. Gentleman to use the correct parliamentary language?

Mr. Williams

I am sorry, Mr. Deputy Speaker. The attendance at the briefing just goes to show the great work carried out by the hon. Member for West Renfrewshire, and we wish him all the best in the future.

11.5 am

Mr. Mark Simmonds (Boston and Skegness) (Con)

I, too, congratulate the hon. Member for West Renfrewshire (Jim Sheridan) on getting the Bill to Third Reading. He has put a great deal of time and effort into behind-the-scenes work to hold together the disparate and diverse group that supports the Bill, which is no mean feat. The group of supporters is a coalition of the willing, including the NFU, the trade union movement, suppliers, retailers and, most importantly, legitimate labour providers in the agricultural and horticultural sectors. The hon. Gentleman has also secured cross-party support in this House. That is not always easy, but he has done it with great aplomb. I also congratulate him on his explanation and analysis of the Bill in his opening remarks, which was expertly done.

Mr. Luff

My hon. Friend may plan to blow his own trumpet later, but meanwhile it is fair to put on the record the fact that he was first person to bring a Bill like this before the House, under the ten-minute rule.

Mr. Simmonds

I thank my hon. Friend for making that point, which I was going to mention a little later in my remarks. As an MP who represents a rural part of Lincolnshire, I support the Bill, as the House knows. Many hon. Members will recall that last September I introduced a similar Bill to tackle the problems associated with rogue gangmasters.

I was delighted that the right hon. Member for Holborn and St. Pancras (Mr. Dobson) mentioned my predecessor, Sir Richard Body, and his unstinting and tireless work to get Governments of both political parties to address the problems and issues, which have existed for many years, surrounding the exploitation of both the indigenous population and migrant workers in the agricultural and horticultural sectors. Although Conservative Members support the Bill, we must recognise that hon. Members on both sides of the House are concerned about the regulations and the cost structure that the Bill imposes on legitimate businesses. I hope that we can seek clarifications and assurances about the legislation's scope and execution during this debate.

Before I discuss the Bill in greater detail, it is important to understand the context within which it is set. Over the past five years, the number of illegal workers entering the country has dramatically increased, partly as a result of this Government's failed immigration policies, but also because of the failure to enforce existing legislation. That has left illegal workers particularly open to exploitation by rogue gangmasters, as those who are here illegally have no recourse through the trade union movement, or any other method to deal with maltreatment.

The Government clearly have no idea of the number of gangmasters and migrant workers—illegal and legal—involved in the problem. They do not know how long migrant workers have been in the UK, where they are working or whether they are being exploited, and they cannot accurately assess the revenue lost to Customs and Excise in VAT or to the Inland Revenue in tax—the regulatory impact assessment that accompanies the Bill openly admits that point.

In 1998, Operation Gangmaster was established to look into the problems of illegal ganging. However, it has been widely acknowledged, not least by the EFRA Committee, which was extremely critical of the Government, that the Government's efforts to tackle the problem have failed. The first report by the EFRA Committee stated: Five years on, Operation Gangmaster has no overall budget, reports to no Minister, has no identified aims or goals and no time frame by which anything must be achieved. That relatively significant lack of co-ordination between Government Departments is one of the major reasons why Operation Gangmaster has not succeeded.

I accept that the terrible tragedy in Morecambe bay, which was highlighted in a moving speech by the hon. Member for Morecambe and Lunesdale (Geraldine Smith), has created a sharper focus for the Government, particularly for the Minister for Rural Affairs and Local Environmental Quality. I echo the comments of the right hon. Member for Holborn and St. Pancras about how well the Minister has conducted the passage of the Bill, particularly in holding private informal meetings with all the interest groups.

None the less, in its conclusions and recommendations, on page 23 of its latest report, the Environment, Food and Rural Affairs Committee says: The reality, then, is that the Government is no nearer obtaining a comprehensive picture of the scale and nature of the problem of illegal gangmaster activity than it was when we published our original report eight months ago. Other than issuing a tender for one piece of limited research, the Government has made no progress. I find that sad.

I did not open my speech in that way for party political purposes; I simply want to ensure that the Minister, other DEFRA Ministers and Ministers in other Departments who are responsible for specific pieces of relevant legislation, and their civil servants, understand categorically that the enactment of this Bill will be not the end but the beginning. It is the efficient enforcement of the Act that will determine its success or otherwise.

We must remember that we already have in place 20 pieces of legislation that should curb illegal practices—but the lack of co-ordination between Government Departments and agencies has resulted in confusion, a certain amount of chaos, and, there is no doubt, a significant growth in illegal activity.

Members on both sides of the House, especially my hon. Friend the Member for Mid-Worcestershire (Mr. Luff), the hon. Member for Morecambe and Lunesdale and I, urged the Government to tackle the problem and ensure that existing legislation was enforced. However, the Government's record of inaction looked set to continue—until the terrible tragic events in Morecambe bay in February. I join other hon. Members in making my personal tribute to the hon. Member for Morecambe and Lunesdale, who has handled herself with dignity and determination in resolving the issues that emanated from that tragedy.

Only after the tragedy, and the subsequent public outcry for action, did the Government feel it necessary to act, and to support the Bill introduced by the hon. Member for West Renfrewshire. To the hon. Gentleman's eternal credit, he had decided to bring the Bill in before, rather than after, the tragedy in Morecambe bay.

I am generally hesitant about introducing licensing schemes and regulations per se, not least when legislation is already in place, but I sincerely believe that a licensing scheme for gangmasters will make the existing legislation easier to enforce. If a gangmaster fails to obtain a licence, the conditions of which will include satisfying the requirements of the existing legislation, he could be subject to prosecution and, ultimately, a custodial sentence.

As several hon. Members have pointed out, the Bill is not a panacaea, and the expectation that it will solve all the associated problems is unrealistic. I am particularly concerned that unless there is extremely robust enforcement, rogue gangmasters may continue to operate outside the licensing system, while legitimate operators face the increased costs of meeting the conditions in pursuance of obtaining a licence.

Like the hon. Member for West Renfrewshire, I was delighted to read that the Select Committee had changed its mind about supporting the Bill, and I shall put on the record two quotations that demonstrate how it has changed its position. Its previous report, published in September, said that it was not convinced a statutory registration scheme offers a stand-alone solution to the problems of illegal gangmasters…without concerted action to remedy shortcomings in enforcement…a statutory registration scheme, introduced as a single policy response will serve nothing". I understood and shared its concerns about enforcement, but I have always felt that a licensing scheme will aid enforcement, provided that there is a co-ordinated effort by enforcement officers ensuring that the conditions of licences are met.

I am sure that all hon. Members are delighted that in its recent report the Committee said: We are persuaded that licensing and registration are required to deal with the problem of illegal gangmasters. Therefore we support the Bill and call on the Government to ensure that time is made available—in Government time if necessary—for its successful passage". I echo that last point, although I hope that that will not be necessary. I was intrigued to hear the hon. Member for Morecambe and Lunesdale seem to suggest that the Government had already committed themselves to ensuring that the provisions of the Bill could pass through Parliament in Government time, if, sadly, the private Member's Bill should fall for some reason.

I now turn to some of the specifics in the Bill, although I have no wish to repeat the debates that took place either on Second Reading or in Committee. I shall talk about the regulatory impact assessment, the proposed structure of the licensing authority and the proposed draft regulations.

The regulatory impact assessment provides an estimate of the likely cost of a licence—a point rightly raised by my hon. Friend the Member for Mid-Worcestershire. The estimate was that a three-year licence would cost between £1,750 and £2,250. I am still concerned that that may be excessive, and I fear that it may prove to be a burden for small-scale labour providers, and could discourage some gangmasters from registering for a licence altogether.

I have been informed by some rogue gangmasters that this charge is minimal, particularly in the context of the large sums that are often to be made in what is—let there be no doubt—a multi-million pound business. I hope that the Minister and his officials will consider a sliding scale of charges, determined by the turnover of the business, to ensure that the small-scale labour provider is not deterred from participating in the marketplace.

Alun Michael

We have designed the arrangements so that there can be engagement with the industry on such issues, such as whether there should be a flat rate or a sliding scale. Would a sliding scale mean more bureaucracy, or would it be fairer? That is precisely why the engagement with the board of the body to be established, as well as in consultation work, is crucial. What matters is not just my view, or that of other DEFRA Ministers and officials, but what will work best in helping the legitimate industry, as the hon. Gentleman suggests.

Mr. Simmonds

I am grateful for that helpful intervention.

For the licence to be effectively self-financing, running costs and bureaucracy must, as the Minister suggested, be kept to an absolute minimum, so that licence fees are as low as possible. However, that should not be done at the expense of enforcement.

According to the regulatory impact assessment, accommodation costs for the new authority are likely to be in excess of £200,000 per annum. I believe that to be extravagant, and suggest that the authority could—and should—be based close to the agricultural areas that it serves, rather than in Whitehall. That would also reduce the accommodation costs and other overheads. Personally, I would be delighted to see it based in Boston in Lincolnshire—[Interruption]—just to mention somewhere at random.

Paragraph 5.2 of the regulatory impact assessment emphasises the point made by the hon. Member for Brecon and Radnorshire (Mr. Williams) when it suggests that labour providers may pass increased costs up the food chain. I wonder how likely it is that retailers will be prepared to absorb the costs themselves rather than pass them on to suppliers and consumers. In order for the Bill to work, retailers must be prepared to engage and co-operate with suppliers. In these days of ethical consumerism, it would be in their interests, so I hope that they will play their part.

In Committee I expressed my concern about some of the ambiguity in the Bill, especially the provisions in clause 13, which refer to "all reasonable steps" to be taken by labour employers such as farmers to ensure that a gangmaster holds a valid licence. I understand that the definition of reasonable steps will be elaborated on in secondary legislation, and I understand why that is necessary. However, it would be helpful to have an assurance from the Minister today that that will be subject to the fullest consultation with the industry. It is essential that those reasonable steps be practical. Farmers will often require labour at short notice, sometimes in the middle of the night while in the middle of a field. It is essential that a gangmasters' register is available 24 hours a day, seven days a week, and is up to date, to ensure that a gangmaster's licence is valid. The only way that can happen is if the register is an online, compute-accessed facility, so that a farmer can access it via a laptop in the middle of a field in the middle of the night.

It is still unclear what steps a farmer or packhouse owner will have to take to ensure that he is not liable for employing an unlicensed gangmaster. It is also unclear from the Bill how far the liability would extend. For instance, would a large retailer which sold produce knowingly harvested or produced by an unlicensed gangmaster be liable to prosecution? Paragraph 44 of the EFRA most recent report, paragraph 44 recommended that the Government consider extending liability to retailers. Has the Minister considered that suggestion and, if so, has he reached any conclusions?

I have previously expressed concerns about the lack of detail available regarding secondary legislation. That point was also raised by my hon. Friend the Member for Mid-Worcestershire and the right hon. Member for Holborn and St. Pancras. I understand why flexibility must be maintained, but the make-up of the authority is clearly hugely important. I am pleased that DEFRA has provided details of the structure and operations of the gangmaster licensing authority, and that that will be subject to affirmative procedure in the House.

In the context of the gangmaster licensing authority, the DEFRA document, in annexe 1, section 17 on "Liaison Groups and Committees", says that the authority shall establish enforcement, labour provider and labour user liaison groups. Will that be stipulated by Ministers in the regulations, or will the authority set up such groups at its discretion? Annexe 2, which refers to exclusions, is helpful in clarifying which types of work require a licence for supplying labour and which do not. I particularly welcome the exclusion of gathering shellfish using boats. Many small-scale family shellfish gatherers would otherwise be classed as gangmasters and would require licences to employ family members.

Annexe 3 suggests that the providers of workers to farmers under the seasonal agricultural workers scheme would not require a licence. That may initially seem sensible, as the organisations that operate within SAWS are perfectly legitimate However, I am concerned by the number of SAWS workers who may have overstayed and breached their permits. In October last year, the Home Office said that it had no reliable estimate of the number of SAWS workers that had officially disappeared and failed to return to their country of origin. Surely it would be sensible to address this aperture in the immigration system before excluding the scheme from the gangmaster license. SAWS suppliers should ensure that their workers do not violate the terms of their immigration status, and that could be something that the gangmaster licensing scheme could enforce and control.

In conclusion, I broadly welcome the provisions to license gangmasters, which are long overdue. The Bill should make enforcing existing legislation easier, provide a level playing field for legitimate labour providers, and put an end to the exploitation of British and migrant workers by rogue gangmasters. However, the Bill by itself is not a complete solution, and there are still issues that need to be resolved. The Bill must ensure that the licence fee does not become too burdensome and a deterrent to legitimate labour providers, and there must be adequate enforcement and prosecution of those who continue to operate outside the law.

I specifically welcome clause 23, which states that the Secretary of State will report to Parliament once a year, analysing the performance of the scheme. I would like the Minister to clarify what form that report will take, and that if required it will involve a debate in the House. We would not want the report just to be stuck in a dusty corner of the Library. As the criminal element becomes more sophisticated and imaginative in its determination to flout the law and exploit vulnerable workers, so we must be equally determined to ensure that legislation is continually monitored and updated to enforce this Bill robustly, to the benefit of those who are exploited and to the benefit of the whole food chain.

11.24 am

The Minister for Rural Affairs and Local Environmental Quality (Alun Michael)

I am pleased to be able to respond positively to a debate that has been remarkably well informed and a detailed examination of the issues before the House. On occasions one feels that the House has skated over the surface of important issues, but that could not be said of today's debate. From the start, it has gone to the heart of the Bill.

I thank my hon. Friend the Member for West Renfrewshire (Jim Sheridan) for giving me the opportunity to engage with the Bill. As many hon. Members have said, it has been a very positive process. The Bill is very different from the one considered by the House on Second Reading, but its target is the same. The Bill is now clear and specific in its design and intentions. It provides a licensing system for gangmasters, which has been debated on many occasions, but it goes further. It will create a kind of antisocial behaviour order for gangmasters, if used in the way that hon. Members who have taken an interest in it intend.

Much work has been done in a short time to get the detail of the Bill right. It has been an excellent example of co-operation and teamwork. I am pleased that hon. Members on both sides of the House have referred to DEFRA officials, because policy officials, lawyers and parliamentary counsel have demonstrated an extraordinary willingness to work hard and quickly to achieve the Bill that we now have before us. They have brought credit on themselves and the civil service in general. They have demonstrated that things can be done both quickly and carefully when the will is there.

I also support my hon. Friend's comments about the work undertaken by officials of the Transport and General Workers Union, the National Farmers Union and others. Indeed, it is fair to say that when we met informally again this week, at a meeting called by my hon. Friend, significant commitment was evident from a variety of organisations. However, the personal engagement of Jack Dromey, the deputy general secretary of the TGWU, and Tim Bennett, the president of the NFU, provided encouragement and support to their teams which was essential in evoking the co-operation necessary to achieve the result we have before us. People not only talked about the problems, they went away and tried to tease out the answers. My right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) posed some difficult questions at the beginning of the process. Having three former Cabinet Ministers—including two former Agriculture Ministers—as part of the team was very good for concentrating the mind. They each made a positive contribution.

I also wish to thank the members of the Committee, of all parties, who worked constructively with us to ensure that the Bill would be effective in delivering its objectives. By the time we reached Committee stage and Report, unseen work had been done that made a difference to the quality of the legislation. We reached the point at which the Committee's members were able to support unanimously the amendments tabled. We now have a much stronger Bill that will, I hope, continue to command the cross-party support that was evident in Committee. We have a Bill that provides for the registration and licensing of gangmasters. It will make the whole labour supply process more open and ensure that gangmasters are accountable for their actions.

Members have raised significant issues during the debate, while making it clear that they want the Bill to progress. I think that my hon. Friend the Member for West Renfrewshire, myself and the groups to which I have referred have discussed and anticipated all those points, but it is only fair to mention some of them. I was pleased that the hon. Member for Mid-Worcestershire (Mr. Luff) referred to the way in which my noble Friend Lord Whitty has engaged with this, issue. He referred to the work of Zad Padda, a young man who has shown leadership and intelligence in recognising the importance for labour providers of setting up an effective system of licensing.

To those hon. Members who have referred to how much activity is going on, I would say that the work of Operation Gangmaster is only in the headlines when a major prosecution takes place, which is often considerably after the events that have led to arrests. A number of successes have been reflected in the press and other media recently, perhaps not with as great a splash as we would wish. It is a pity that that was not reflected in the Environment, Food and Rural Affairs Committee report. It was right to comment that the support of that Committee for the Bill, which was not given earlier, is important and welcome.

My hon. Friend the Member for Morecambe and Lunesdale (Geraldine Smith) was right to underline, as other Members have, the fact that this Bill is not a panacea. Indeed, legislation is never a panacea and never a substitute for action. Previous Governments have made the mistake sometimes of engaging in frenetic activity in adding to legislation, without making a difference on the ground. We must recognise that we are dealing with illegal activity, which does not operate on the basis of convenient structures in which we can intervene without a great deal of work. We are dealing with a market in which there is flexibility, in which people change their methods of working rapidly, and in which a lot of people are not prepared to obey the law. Flexibility is what the market needs. Growers, to whom the hon. Member for Mid-Worcestershire referred, need help fast at particular stages in the year, but that flexibility is what makes it difficult to regulate the industry properly. I take on board the point made about the impact on lifeboat crews and the police, and the much wider ramifications of the events in Morecambe bay.

My hon. Friend the Member for Morecambe and Lunesdale rightly mentioned the damage done to legitimate labour providers. I am pleased that Members on both sides of the House have refereed to the legitimate contribution made by those who are trying to operate within the law and do things properly. The liaison between Departments and agencies, which was mentioned by my hon. Friend the Member for West Renfrewshire and touched on by various other Members, is a serious issue. The problem is that although liaison is often good at ministerial level and the will is there to co-operate, the situation at ground level is different. The trick is to ensure that that will is reflected on the ground.

In relation to the Bill, enforcement has two elements. Of course, there is the desire to prevent tax evasion and to ensure that the minimum wage is paid, but the two elements are enforcement by licensed gangmasters of the requirements of the agency in relation to the code of practice and so on, and making sure that we burn off those who work outside the licensing system so that they cannot undercut legitimate labour providers. Those two elements need to be looked at separately, because they are different. Enforcement in relation to those who are within the virtuous circle of licensing needs to be kept to the minimum necessary to ensure that they comply with the requirements, whereas firm and swift action is needed to ensure that those who are not licensed, and not within that virtuous circle, are unable to continue their activities.

The hon. Member for Southport (Dr. Pugh) referred to agencies and those who operate in the shadows. If somebody is operating as a gangmaster, whatever title they use or however they advertise, they are within the ambit of the legislation. One of the questions that we discussed with some care was that of employment agencies. We did not want a duplication of legislation, but we wanted to ensure that somebody could not register as an employment agency and effectively act as a gangmaster but not he caught by the provisions of the Bill. I believe that we have got the design right.

Mr. Luff

This is a technical point, and I am happy if the right hon. Gentleman wants to write to me rather than answer it now. There is one quite sophisticated packing operation in my constituency, which requires a large supply of office labour to deliver its services. If it used a recruitment agency to recruit staff for the office rather than the packing side of its operation, would that recruitment agency also be required to register as a gangmaster?

Alun Michael

As often seems to be the case, I am happy to engage in correspondence with the hon. Gentleman on arcane detail. I think the answer is that if staff were recruited to undertake activities that fall within the ambit of the Bill, that would be caught by its provisions. Were those activities outside its ambit, they would not be caught. On the other hand, if the activities are ancillary, that is the kind of area that needs to be clarified. I believe that we have ensured that the Bill casts the net as widely as possible, so that we can provide by exclusion, which is allowed for in the Bill, that those not intended to be covered are not caught. That provides flexibility in the architecture of the Bill, which I hope will be effective.

My right hon. Friend the Member for Holborn and St. Pancras helped at an early stage, applying his experience as a Cabinet Minister and his acute sense of the practical, by asking the most challenging questions about how the Bill would operate in the mists of the morning in some of the flatter areas of England. As a result of responding to those questions, we have improved the Bill considerably. He was absolutely right to underline the legitimate concern about swindlers who do not pay tax, national insurance or the minimum wage, and to remind us of the long history of parliamentary concern about exploitation, which goes back much further than a generation. I agree entirely that action not just in terms of co-ordinating raids but in terms of following up intervention should be made much easier, which goes to the heart of the Bill and of what I meant when I described it as providing an antisocial behaviour order for gangmasters.

A number of questions were asked about who would be caught. I was asked whether the Bill would cover workers in a meat processing plant. The Bill covers all processing and packaging of produce derived from agricultural work, which includes meat. We will consider the coverage of downstream processing activities in more detail when the regulations are made, to ensure that we do not inadvertently catch those for whom the legislation is not intended. All such work is included unless it is excluded by regulation.

The hon. Member for Brecon and Radnorshire (Mr. Williams) asked how quickly licences would be introduced, and whether we could ensure that there was not a long period before licences could be obtained. The Bill allows for transitional provisions, which would allow temporary registration or provisional licences, to ensure that labour providers can be brought into the licensing scheme quickly and allow us to concentrate on operating the scheme and ensuring that it restricts those who seek to break the law. The hon. Gentleman referred to his experience in East Anglia in the missionary field. I reflected that my experience was of stone picking after ploughing during bob-a-job week in north Wales—he will appreciate that there are some areas of the uplands in which stones are quite a significant crop. That activity may well come within the ambit of the Bill. I make it clear for the record that that was before my experience of the Transport and General Workers Union, when I was employed on the buses.

As the hon. Gentleman said, it is important to encourage gangmasters into the system straight away. It would be a tragedy if they hung back and waited to see what happened. We need to get them into the system and to make it clear that being outside it will not be tolerated and will lead to swift action. On the other hand, we do not want a bureaucratic system that produces just statistics. In terms of the Select Committee's comment yesterday, putting effort into bean counting is not the way to approach the matter; we want to ensure that it is unrewarding to evade the law.

Much preparation work has been done with the Ethical Trading Initiative. Two or three hon. Members have referred to the fact that the Ethical Trading Initiative has discovered some flaws in the audit system. I do not think that that is terribly surprising. Those who have been involved in the Ethical Trading Initiative have effectively had to accept an additional burden as legitimate providers of labour, while those who do not bother to get involved do not have that burden, and those who operate completely outside the law obviously avoid all sorts of overheads. The Ethical Trading Initiative and the systematic approach that some providers have sought to develop will be greatly strengthened by the legislation.

The hon. Member for Boston and Skegness (Mr. Simmonds) made a series of important points. I congratulate him on his positive approach to the Bill. He has genuinely supported it and sought to help to improve it. I hope that that does not reach the ears of the Leader of the Opposition and damage the hon. Gentleman's political career. He showed himself to be courageous, even adventurous, by referring to immigration policy. I gently remind him that the Leader of the Opposition had personal responsibility for immigration policy as well as wider areas of the law for a number of years. I am not sure that the hon. Gentleman was wise to draw that to the attention of the House because it was not exactly the most productive period, in respect of either immigration policy or enforcement of the law.

The hon. Gentleman asked about the scope and execution of subsidiary legislation. We are trying to give the shape of the subsidiary legislation, such as on the membership of the board of the non-departmental public body that will run the scheme, so that, as has already happened, points can be made about whether there is a gap, or whether the balance of the membership is right to ensure that the expertise is there. The final version of the statutory instrument that provides for the membership of the board will follow soon after the legislation has reached the statute book, but we have outlined a proposed membership, which was not dreamt up within the Department for Environment, Food and Rural Affairs but arises from the discussions that I referred to earlier with all the participants to try to ensure that we get it right. That is the way we are approaching the subsidiary legislation generally: we aim to develop policy and the drafting at the same time as the Bill goes through the House, and to give as much clarity as possible to those who will look at the Bill in another place as to how the provisions will be used. That has not always been the case. My first experience of legislation in the House was with the Immigration Act 1988. The Minister who led for the then Government was Tim Renton, who later became their Chief Whip. I spent a lot of time trying to tease out of him the slightest indication of what the subsidiary legislation might look like. We even offered the old regulations as a gift-wrapped package at Christmas in the hope that he would relent and give some insight into what would happen after the Bill became law.

The position this time is very much the reverse. We are seeking to work with all the organisations and to be open with hon. Members about the way in which the subsidiary legislation will be used, because the experience of all the organisations and the application of the knowledge of hon. Members can help to get it right. We will continue in that spirit. I undertake to my hon. Friend the Member for West Renfrewshire, the hon. Member for Boston and Skegness and others who served on the Committee to keep them informed as we develop those ideas.

The hon. Member for Boston and Skegness made some points about delivery. We could give the impression that nothing much is going on. The message needs to go out that a lot is going on in order to catch those who are defrauding the Exchequer as well as undertaking exploitation. Operation Gangmaster has delivered benefits to the Exchequer of some £10.6 million in 2002–03. That includes recovery of income tax worth some £4 million and a reduction in benefit fraud through the prevention of claiming benefits while working. Government enforcement action has led to a number of high-profile arrests and prosecutions of gangmasters in recent weeks.

The Department for Work and Pensions has identified 235 over-payments and 1,023 adjustments to benefits worth £405,000, securing 138 sanctions and prosecutions. The Inland Revenue specialist team is settling 46 inquiries and reviews, and identifying unpaid tax and national insurance Contributions worth £4.3 million. In addition, there have been criminal prosecutions of 14 gangmasters for VAT offences involving £5.9 million and resulting in prison sentences totalling 31 years.

Some of those recoveries have been done without the sort of prosecutions that bring the matter into the public eye and lead to headlines, but people should be in no doubt that enforcement measures and co-operation between Departments are having a positive effect.

Mr. Luff

Would the right hon. Gentleman take this opportunity to remind police forces that another area where enforcement is very important is traffic offences? It would be helpful if police forces showed more enthusiasm to tackle the obvious white mini-buses that run around illegally.

Alun Michael

The hon. Gentleman makes his point effectively. It is always difficult for the police to balance the different requirements and, indeed, the different calls on their time from hon. Members, but I am sure that, as a result of recent events, the police are well aware that there is an issue here that is not just about casual labour—it is about a number of much more serious things. Indeed, the Home Secretary and members of his team have made it clear how important they regard those issues.

The hon. Member for Boston and Skegness referred to the regulatory impact assessment and was concerned about the cost to small-scale providers. That issue needs to be addressed. On the one hand, we want a licensing system under which the charge and the means for assessing it are as simple as possible, while on the other we must ensure that we do not set up a perverse incentive for smaller-scale providers. That is one of the issues that we want the partners to discuss both before the establishment of the agency, and within the agency, as soon as the shadow board is in place.

The hon. Member for Boston and Skegness referred to accommodation costs and, if I understood him correctly, made us an offer that we cannot refuse—free accommodation in his constituency. We do not envisage that the accommodation will have to be in Whitehall, so we are open to offers, even from Boston and Skegness. I can assure him that we shall certainly not be gold-plating the accommodation costs. Currently, all the costs are of an indicative nature. The very fact that the board will include representatives of those who will have to pay the licensing fees will, I hope, help to ensure proper scrutiny of the proposals so that costs are kept to a minimum. That will obviously have a knock-on effect on licence fees.

Mr. Dobson

The concept that the licensing system should pay for itself seems reasonable, but this point has just occurred to me: is there any possibility that some of the money obtained from prosecuting the villains could also be used to finance the enforcement system, on the polluter pays principle? The villains are the polluters.

Alun Michael

My right hon. Friend has vast experience of hypothecation and of attempts to persuade the Exchequer that any income it derives should be directed back to the activity whence that money came, so he can anticipate my answer. However, we have acknowledged that as well as operating the licence system and ensuring that those who are licensed obey the licensing terms, there is also a need for enforcement in respect of people who are not licensed or who have had their licence withdrawn. The Government should take responsibility for that, to ensure that inappropriate burdens are not put on the licence fee and on legitimate gangmasters.

Mr. Luff

Until the right hon. Member for Holborn and St. Pancras (Mr. Dobson) put his question, I had not thought about that point either. In fact, there is a precedent in government. We are told that speed cameras pay for themselves and surpluses go to the Exchequer, so perhaps the fines under this system could pay for the authority and the surplus could go to the Exchequer.

Alun Michael

It is clear that the hon. Gentleman has not thought that idea through. He would not have made that proposal when his party was in government. I was involved in the discussions about the return of money from speed camera fines and can tell him that it takes an awful lot of evidence to persuade the Treasury that it should go along with such proposals. I do not think we need to take that route.

There are advantages to the Exchequer in the prosecution of people who do not pay tax and so on, which create an incentive for the application of the law in different ways. As I said, we have looked into DEFRA's enforcement role, as well as into co-operation between different enforcement agencies. In fact, groups will be set up under the Bill to ensure that the agency liaises with labour providers and other enforcement agencies. The agency will set up those liaison groups to ensure that the process is joined up and that the groups are practical and effective and do not merely fulfil a theoretical requirement. I hope the hon. Gentleman will accept that the important thing is that the process should be rooted in what happens in practice and that the different interests of enforcers and labour providers, as well as the overall policy on the operation of the licence system, are considered in the liaison groups. The board will bring all the significant players together and we have designed the Bill so that we can achieve a balance between specific and overall interests.

The hon. Member for Boston and Skegness asked about retailers absorbing costs. It is important that we have an indication from the supermarkets, the British Retail Consortium and others of their commitment to the licence process and the need to follow it through in practice. We shall be discussing that with them.

In response to another point made by the hon. Gentleman, I can promise that we shall hold the fullest consultation with the industry and ensure that everyone has a chance to comment on the process as it is developed. We want fast access to information on the ground, because unless the police and others who operate the licence system are able to get information quickly, we shall be unable to draw a firm line between legitimate, licensed gangmasters and those who operate outside the law, which is obviously the focus that we need.

That process will be helped by the work that Home Office Ministers are undertaking to simplify and clarify the authorising of overseas workers in this country, so that they can show that they are in the UK legitimately. The system has been over-complex in the past, but the need to demonstrate legitimacy is fully understood and that is important for labour providers and other employers.

I think that I have referred to the liaison groups and covered most of the points raised in the debate.

Mr. Simmonds

Will the Minister deal with the final point that I made about the implications of the seasonal agricultural workers scheme, which is referred to in annexe 3 of the regulatory impact assessment? I understand why it has been excluded, at least initially, from the provisions in the Bill, but I hope that he will deal with several of the issues that I highlighted in my remarks.

Alun Michael

I am happy to consider the hon. Gentleman's points in detail. We believe that the seasonal agricultural workers scheme is carefully designed, so the possibility of it being used as cover for illegitimate activity would not arise. However, I am happy to reconsider that and to write to him with the details.

I referred to the Bill as creating an antisocial behaviour order for gangmasters. The licensing scheme will provide a further tool for us to use in the fight against the exploitative activities of illegitimate gangmasters—those who are not concerned with obeying the law. It provides robust enforcement powers to support that objective.

The Bill also ensures a high degree of stakeholder involvement in the detailed design and operation of the new licensing arrangements. I reinforce the point made at the beginning of the debate by my hon. Friend the Member for West Renfrewshire when he outlined the Bill's impact and how it would work. It creates a new non-departmental public body to operate the licensing scheme. We want to make sure that it is not an unnecessary piece of bureaucracy and that the Bill will bring together key stakeholders and the Government to steer and operate the new licensing arrangements so that those who provide labour do so in a way that is within the law and is not exploitative. Therefore, the names of the providers of labour who act properly and within the law will not be tarnished by the activities of the lawbreakers, the thugs and those who have no respect for the law.

It is important that there should be commitment to the licensing scheme from all sectors of the industry, from producer to supermarket. The representation on the board secures that engagement. The involvement of stakeholders will also ensure that the conditions attached to a licence balance our wish to see an end to the exploitation of vulnerable workers with the need to ensure that the licensing arrangements do not place unnecessary burdens on labour providers and others in the fresh produce supply chain. That is why the licence fees will be set by the licensing authority in discussion with the Government.

Reference has already been made to the fact that the indicative costings suggest that the fee could be between £1,750 and £2,250 for a three-year licence, but those figures will be need to be reviewed once we have a clearer idea of the conditions that the licensing authority thinks should be attached to a licence. Again, that involves the engagement of all sides of the industry. Although the licensing authority will have day-to-day responsibility for the operation of the licensing scheme, the Government will also have an important role to play. In particular, we will establish and fund an independent appeals mechanism for the licensing process. That will ensure that labour providers can appeal against decisions taken by the authority involving the issue and withdrawal of licences.

At the beginning of the debate, my hon. Friend the Member for West Renfrewshire stressed the importance of enforcement, as others have. Co-ordinated action and being proactive are important We will also put in place robust enforcement arrangements to deal with the criminal offences created by the Bill. It gives the Secretary of State responsibility for the appointment of enforcement officers. That ensures that officers from existing enforcement agencies can utilise the new criminal offences to tackle gangmasters when this helps to deliver departmental enforcement objectives—in a sense, the antisocial behaviour order aspect of the Bill. We are also considering making additional resources available to increase the number of enforcement officers operating in this area, and we will be looking to secure police co-operation when appropriate.

Enforcement activities need to be intelligence-led. The powers of entry and arrest provided for under the Bill will be used when necessary but I reassure the House that all enforcement officers will be trained appropriately before they are given the authority to exercise these powers. There may be considerable merit in including housing enforcement. officers within the Bill's ambit, effectively to facilitate a one-stop shop approach to licensing and enforcement, but we have made it clear where the different responsibilities lie. That will also ensure that enforcement officers have ready access to information on gangmaster activities flowing from the licensing scheme.

Information sharing will be a key element in the successful introduction of the licensing scheme, so the Bill creates a two-way flow of information between the Government and the licensing authority. Again, that will ensure that the authority can take fully informed decisions on whether a licence should be issued or withdrawn. It will also provide valuable intelligence for Government enforcement bodies.

The Bill also provides for robust maximum penalties. I said that the intention is that if an offence is committed, prosecution can follow rapidly, but should there be repeat offences, we would hope that the courts use the higher penalties quickly to burn off any idea that offenders can get away with it, because that would do great damage to the licensing scheme and, again, provide succour to those who do not respect the law.

It has been underlined that much of the licensing scheme remains to be clarified in regulations. I have stressed that despite our wish to see licensing introduced as quickly as possible, there will be full consultation at every stage of the regulation-making process. We intend to set out our ideas as early as possible so that that discursive opportunity is used and that we get it right. That will enable us to move quickly once the legislation is on the statute book. The key regulations on the operation of the licensing authority will be presented to the House for detailed consideration. That is appropriate and reflects our wish to ensure that everyone has a chance to consider the detail of the new arrangements.

We have come a long way since Second Reading, and we still have some way to go before a fully operational licensing scheme can be introduced. However, I hope that the House agrees that the Bill provides a firm foundation. We understand the industry's need for a flexible labour supply, but that flexibility cannot be provided at the expense of workers. Licensing will oblige gangmasters to operate their businesses ethically. It will create a clear distinction between legal and illegal operators and strengthen the ability to enforce the law in a variety of ways. It provides the ability to ensure that those gangmasters who operate without a licence are prevented from doing so and that legitimate labour providers know that those who are willing to use any means to undercut them will be put out of business in short order. That will strengthen the legitimate part of the business. There can be no place for unlicensed gangmasters in future.

As many hon. Members said, the Bill is characterised by the tremendous spirit of co-operation displayed by all those involved with it. That has helped to ensure its speedy development and passage to this point. I hope that that spirit of co-operation continues and that the Bill successfully completes its passage through Parliament. Indeed, I hope that the spirit of co-operation will also help to guarantee the success of the new licensing arrangements. I commend the Bill to the House as a positive response to the problems caused by gangmasters who are willing to exploit those who cannot look after themselves.

12.3 pm

Jim Sheridan

With the leave of the House, I want to thank right hon. and hon. Members for their support, especially those who made such powerful and eloquent contributions to the debate, not only in the Chamber today but throughout the parliamentary process. In particular, I thank those people who gave me the benefit of their advice and experience, which was extremely helpful.

Again, I express my gratitude to the Minister and his officials, not only for their hard work, but for the receptive way in which they accepted the changes that we proposed and for the expeditious manner in which they responded to those suggestions. I must say, however, that I was somewhat surprised when the Minister referred to "Bob-a-job". I had not thought that he was of an age to be able to feel nostalgic about that worthwhile experience. Finally, I also want to thank the broad coalition that has supported the Bill every step of the way.

We are all too aware that, today, politicians have a less than glowing reputation. Election turnouts are at an all-time low, voters are disengaged and opinion polls rank us somewhere between estate agents and loan sharks in the popularity stakes. That is little wonder in an age when the public perception is that politicians would rather trade insults at the Dispatch Box than work together to solve problems and that politics is more about delivering memorable soundbites than about developing workable policies. It is therefore very easy to be cynical about what we, as MPs, can achieve during our time on these Benches, but today we can achieve something—we can effect real, lasting and positive change. Today, we have a rare chance to do what we were elected to do: to make a difference.

The Bill represents a different kind of politics. It is not the product of political point scoring; instead, it has been born out of partnership, consensus and reasoned debate between workers and employers, between Government and industry and between Members from every party in the House. At this point I want to pay tribute to the hon. Member for Boston and Skegness (Mr. Simmonds), who has worked tirelessly alongside the rest of us on the Bill and should be congratulated on that. Perhaps most importantly of all, the Bill is not driven by slogans and spin; instead, it is inspired by ideas and motivated by principles.

It has been said on a number of occasions that the Bill is not a panacea, and I have never said that it will cure every ill or right every wrong, but it will make a difference. It will serve and protect those who, by electing us to this House, give us not only their votes but their trust. So, yes, the Bill may be only one small step towards ending worker exploitation, but it is a step in the right direction, and it is a step on a journey that social justice and workplace dignity demand we take. Good law can do great things, and this Bill makes for good law. I therefore thank the House for its indulgence and ask for its support.

Question put and agreed to.

Bill accordingly read the Third time, and passed.