Motion for leave to introduce a Bill (Standing Order No. 23)

I beg to move,

That leave be given to bring in a Bill to apply the provisions of the Gangmasters Licensing Act 2004 to the construction industry;
and for connected purposes.

I shall always be proud that this Government gave their support to the passing and implementation of my private Member's Bill targeting illegal gangmasters. That legislation sought to flush out those who were exploiting both migrant and indigenous workers, and despite the powerful arguments put forward at the time, the Bill covered only agricultural and related industries. I, along with the trade unions and legal gangmasters—we were supported by many of my colleagues who are here to support this Bill, and I remain extremely appreciative of their assistance—argued at the time that should that Bill prove effective, the unscrupulous gangmasters would move into other industries. The evidence suggests that that is exactly what has happened. The construction trade was the industry that we used as an example then, because of its diverse and mobile nature, and it is where we find illegal gangmasters working now. Those of us who worked in the construction and related industries are well aware of the dangerous environment that those on the job face, and I will return to that later.

Migrant workers who come to this country for legitimate work are often lured into the twilight world of illegal gangmasters, so I caution those who blame the workers and ask them to focus instead on the real villains: the illegal gangmasters. Anecdotal evidence from those who have suffered under those unscrupulous people suggests that they are experiencing the same despairing conditions as did those who were exposed in the agriculture industry—none more so than the Chinese workers who perished on the shores of Morecambe bay.

Despite the current financial situation, most commentators agree that we can build our way out of this downturn with major construction projects, such as the Olympic village, and related issues. What we do not need is a Morecambe bay-type tragedy in the construction of the Olympics. Health and safety matters are extremely important to those in the building trade and wider related industries, and people must have the fundamental right of returning home safely after their work.

Since 2007, there have been 120 fatal accidents in the construction industry. Again, there is evidence that illegal gangmasters supply unskilled labour to major construction companies and their subcontractors to carry out skilled and dangerous work without taking into consideration the safety consequences for the general public, others on the site and themselves. These gangmasters also undermine the legitimate employers who invest in training, and pay their taxes and national insurance contributions. That is particularly true of—and financially damaging to—small businesses struggling to survive and compete.

On the financial implications, there is increasingly tangible evidence that gangmasters, who are required to register, should also be tax-compliant and follow the VAT registration rules. In 2007 alone, the Gangmasters Licensing Authority identified more than £2 million in extra VAT payments for the Exchequer—the figure takes no account of additional income tax and the national insurance contributions now being paid as a result of the GLA's work. So the Government have a vested interest in giving serious consideration to this issue, and I sincerely hope that they do so.

Members of the House should also be aware of the serious matter of community unrest; where genuine workers see others doing their work and not contributing to the community or wider society, social unrest and frustration is generated. That manifests itself, as has happened this week, in people turning to extremist parties such as the British National party, which are happy to exploit such situations. There is a political advantage in addressing this issue and demonstrating to the workers that we are on their side and on the side of good employers.

May I give the House just a flavour of some of the activities being undertaken by these gangmasters, by going through some case studies? A14 Vehicle Hire, which is based in Kettering, had its licence revoked with immediate effect after serious concerns were expressed over the safety of its workers. The GLA uncovered allegations of workers being housed in overcrowded and unsafe accommodation, and a number of houses were immediately closed by the local authority for breaches of gas and electrical safety regulations. Some 15 adults and three children were found in a four-bedroom house.

Timberland Homes Recruitment Ltd had its licence revoked with immediate effect on 6 May 2008.The company was based in Suffolk but sent workers to pick flowers in Cornwall and Scotland. GLA officers found serious abuses, including a threatening letter to workers stating that they were not free to leave before the end of the contract without paying £700, and that if they did not have the money, it would be recovered from the workers or their families in their home country. Some workers stated that they received £24 for a nine-hour day. No time-sheets were used, so pay could not be accurately recorded. The Vehicle and Operator Services Agency issued prohibition notices on six Timberland minibuses in Cornwall, but Timberland still transported workers to Scotland in the same vehicles. Timberland Homes Recruitment Ltd did not appeal against the GLA decision. It is no longer permitted to trade in the licensable sectors, but it is believed to be operating in the construction industry.

I shall give a second case study. Morantus Ltd, which traded as 247 Staff in Burton on Trent, supplied workers across the midlands to British Bakeries, Thorntons and Florette. A GLA investigation found that Robert Taylor, director of Morantus, forced migrant workers to live in run-down, cramped houses, and made them pay over the odds for that accommodation as a condition of finding them work. The officers found a room, measuring 2.8 m by 3.8 m, that housed three adults, two children and a baby; it had a double mattress, a single mattress and a child's seat. Money was withheld from workers, and they were forced to sign standing orders under the threat of not receiving work. Workers were not paid the national minimum wage, and they were bonded to the accommodation; if they wanted to keep their jobs, they had to use, and pay for, the accommodation provided. Morantus lost its appeal against the GLA decision, and is now believed to be trading in the construction industry.

I turn to the subject of independent research. An independent report published in March 2009 by the universities of Liverpool and Sheffield, commissioned by the GLA, shows that the tough enforcement approach of the GLA makes for effective regulation. The researchers found that

"licensing has been an appropriate tool to regulate labour providers...agency workers are now better placed because of government regulation; and...the GLA is an effective and efficient regulator."

That is why we would like the gangmaster licensing legislation to be extended to the construction industry.

In conclusion, the trade unions, the Federation of Small Businesses and the Federation of Master Builders are asking for help to get the industry through these difficult times. With a little bit of vision and support, we can bring about a change for the construction industry.

Question put and agreed to.

Ordered,

That Jim Sheridan, Mr. Michael Clapham, Alun Michael, Mrs. Ann Cryer, Mr. David Hamilton, Mr. Ian McCartney, John Robertson, Mr. Stephen Hepburn, Sandra Osborne, Mr. Jim Devine, Mr. Jim McGovern and Mr. David Anderson present the Bill.

Jim Sheridan accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 16 October and to be printed (Bill 109).