My Lords, Amendment 32 stands in my name and that of my noble friends Lady Cox, of Queensbury, and Lord Hylton. I thank them for their support for the amendment. I also thank the Public Bill Office of your Lordships’ House, which gave me a lot of help with the drafting of the amendment. The purpose of the amendment is to give the Secretary of State power by regulation to,
“establish the Modern Slavery Victims’ Fund (“MSV Fund”) to receive and distribute the proceeds referred to under subsection (2) which have been recovered under a confiscation order, where that order is made in respect of a person who has been convicted of an offence under section 1, 2 or 4”.
If the amendment were to be incorporated in the legislation, it would enable the MSV fund to receive,
“no less than 50 per cent of any money recovered under a confiscation order. Subject to subsection (4), the proceeds referred to under subsection (2)”,
would then be distributed by the fund, with 50% of the proceeds given as compensation to victims, 25% distributed to the charities and other organisations listed in the regulations, and 25% distributed to the organisations whose purpose is to prevent slavery. I would have in mind, obviously, the police, but also others such as the Independent Anti-slavery Commissioner.
Modern slavery is very profitable. The International Labour Organization estimates annual profits from slavery to be around $150 billion a year. For example, a child trafficked and forced to pickpocket on the streets of London can, according to Anti-Slavery International, bring traffickers yields of £5,000 to £10,000 every month. Modern slavery is a high-profit, low-risk crime. Most of those involved escape justice and, even where there is a conviction, asset seizure is often considered too late in the process so the perpetrator has had a chance to move their assets elsewhere. Even where confiscation is made as part of the criminal proceedings, compensation is very rarely ordered.
The amendment would address this by bringing confiscation of assets and compensation to the very heart of the Bill and, in doing this, it would be similar to the United States anti-trafficking legislation. Confiscation has the effect of hitting the perpetrators where it hurts and its deterrent effect is potentially
more significant than the threat of a long prison sentence, which can easily be avoided by entering a plea bargain. As the average prison sentence for modern slavery offences has been relatively low— around five and a half years—unless the perpetrator is stripped of their assets they can come out of prison and enjoy a luxurious life, while victims continue to suffer.
Restorative justice is also a function of compensation for victims and is the key to this amendment. By awarding damages to the victim, their suffering is acknowledged in a way that convicting the perpetrator rarely achieves. Victims who act as witnesses are of course often re-traumatized in the process. Furthermore, compensation gives victims stability and a chance to rebuild their lives. For example, one victim who was compensated has invested the compensation to pay for university education and is now pursuing a law degree.
I first raised the possibility of using confiscated assets to help victims and deter traffickers in 2002, during the passage of the Proceeds of Crime Bill. I argued that there were simply insufficient resources to adequately address a crime which, too often, was out of sight and out of mind. Yet even then, the United Nations had identified people trafficking as the fastest growing facet of organised crime and the third largest source of profit for organised crime, after the trafficking of drugs and firearms. At the time, the Government admitted:
“At present there is no specific offence of trafficking in human beings and so no data exist about the confiscation of assets of those engaged in this practice”.—[Official Report, 18/6/02; col. WA 70.]
My 2002 amendment called for the proceeds of trafficking to be channelled into the support of victims and the resourcing of a strategy to tackle this scourge at source. Supporting the amendments then and the use of confiscated assets to hit the traffickers where it hurts, the late Lord Wilberforce, a Law Lord and a descendant of William Wilberforce, described trafficking as,
“a pervasive crime committed in all kinds of areas by all kinds of people. It must be dealt with by a great variety of authorities”—
I repeat, a great variety of authorities—
“and police forces all over the country, many of which have no idea of the nature of the crime or the remedies available to deal with it”.—[Official Report, 25/6/02; col. 1225.]
Since 2002, the Government have been persuaded to develop the principle of confiscating assets which have been accumulated through the pursuit of crime. I strongly welcome this but it would help this debate if the Minister could describe what has been the experience of the Proceeds of Crime Act to date. It has been suggested that there may already be as much as £2 billion in uncollected POCA fines, so whether or not there is a dedicated dispersal fund, as the amendment would require, it would be helpful to know how the Government intend to improve the collection rate and what their estimate is of the sums currently outstanding.
Addressing Pope Francis at a Vatican conference on human trafficking held in April this year in Rome the Home Secretary, the right honourable Theresa May MP, said:
“Our efforts must also focus on going after the profits of those involved, and compensating victims with seized assets”.
The Bill itself recognises that the first call on seized assets should be to provide reparation to the victims of the modern slavery offence. Where there are seized funds left over, the Government say that they will benefit criminal justice agencies through the existing asset recovery incentivisation scheme. ARIS has the objective of providing all operational partners who use the asset recovery powers in the Proceeds of Crime Act 2002 with incentives to pursue asset recovery as a contribution to the overall objective of reducing crime and delivering justice. It is not, however, specifically targeted at tackling human trafficking and modern slavery. However, that scheme is not on a statutory footing, although some of the moneys distributed under ARIS are used to fund improvements in asset recovery capabilities and on community projects, and I welcome that. This amendment would create a statutory scheme.
Around £80 million was returned to operational partners from ARIS in 2013-14. The Minister might like to say how much of that money is used specifically to deter and bring to justice the perpetrators of modern slavery. I would also be grateful if he would quantify what he believes will be necessary to fund this ambitious legislation, otherwise it risks becoming yet another declamatory law which sounds good but can make little difference. Will he say how much money will be set aside to support this legislation? We all recall the Climate Change Act 2008, which imposed what was called a “legally binding obligation” for reduction of 80% of greenhouse gas by 2050. It was never made clear how it was to be done, who was to be held to account if this target was not realised and what punishments there would be.
The Child Poverty Act 2010 was not much better, requiring the elimination of child poverty by 2020. If the Bill is not to be added to the list of declamatory legislation which has inadequate resources attached to it to ensure its enforcement, we need to insist on ways of providing adequate resources. Although the Minister says that the Government are unconvinced about the need to ring-fence these assets for this dedicated use, he has indicated his willingness to discuss the amendment and said, in a letter to me:
“There is a great deal of common ground between us on the principles of how seized assets should be used, in terms of using the funds raised to compensate victims and support law enforcement agencies”.
I welcome that greatly.
The Government tend to suggest that the police is the agency which needs to be funded to bring perpetrators to justice. Of course, there is a lot in that argument. However, as the late Lord Wilberforce recognised, a great variety of authorities need to be involved and many, along with the police, are completely underresourced. At Second Reading, I highlighted the position of the Gangmasters Licensing Authority, established in 2006 in the aftermath of the tragic death of 23 Chinese cockle-pickers who died in Morecambe Bay, part of a criminal racket exploiting workers all over England, and estimated to funnel £1 million per day back to China.
In 2013, Professor Gary Craig of Durham University, working with the Wilberforce Institute for the study of Slavery and Emancipation and the Joseph Rowntree
Foundation, published Forced Labour in the United Kingdom, a report which specifically said that the GLA was insufficiently resourced. The report found that:
“The scope of the GLA should be extended to cover all sectors using labour providers and greater resources should be available for the GLA to be able to fulfil its role effectively”.
The three-year study draws on data from legal, policy and regulatory bodies and calls for the Government to reconsider some key policies and take a broader view of the problem. The report also found that:
“Monitoring for severe labour exploitation is generally weak and needs to be strengthened”.
Professor Craig, who is professor of community development and social justice, says that workplace enforcement agencies are now doing fewer inspections, becoming focused on only the most serious offences rather than tackling all types of serious labour exploitation. Commenting on the scale of the problem he says:
“Criminal activity of this nature is difficult to monitor, but conservative estimates are that there are currently at least several thousand cases of forced labour in the UK and 880,000 across the European Union”,
and that those trafficked for labour exploitation would soon exceed those trafficked for sexual exploitation.
I turn to the need for public education, something which many noble Lords have raised today and which the Government acknowledge the need for. No one has said how that would be resourced. Professor Craig remarks that there is a “real problem” getting people to acknowledge not only that slavery exists in the UK, but that, as his research suggests, there may be upwards of 10,000 people at any one time in conditions which we would class as modern slavery. I noticed over the weekend that the BBC added another 3,000 to that number.
In addition to recommending the extension of the mandate of the GLA, providing powers of arrest and investigation, Professor Craig argues that the GLA should be able to keep fines to fund its work, adding that the resources directed to the GLA are totally inadequate. If the dedicated fund specified in the amendment were created, it could be used to extend the mandate and work of the GLA and other agencies involved in this most serious of crimes. The Independent Anti-slavery Commissioner, Kevin Hyland, has also said in an interview in the Sunday Times that the resources needed should be raised as a result of using the confiscated assets of funds that have been seized.
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Sometimes Ministers, instructed by the Treasury, raise the old bogey that Governments do not support the use of hypothecated funds, and that revenues must be directed to the Treasury for subsequent allocation. That is manifestly not true, and even the Bill itself accepts the principle that some of the funds will be specifically used to address the challenge of modern slavery and human trafficking—the Home Secretary said so. There are plenty of precedents, from the fossil fuel levy to the levy on the pig industry to eradicate Aujeszky’s disease, that have created levies or funds to tackle specific hypothecated challenges. If we can hypothecate funds for pigs, surely we can do the same thing for humans.
To reiterate and conclude: the amendment takes a moderate, incremental approach. The fund would receive no less than 50% of any money recovered under a confiscation order; 50% of the proceeds would then be used to support the victims, 25% distributed to those charities and agencies combating slavery and 25% to those organisations preventing, investigating or prosecuting those responsible. Under the terms of the amendment, the Independent Anti-slavery Commissioner would serve on the management board of the fund, which itself would be established by the Home Secretary by regulation.
I accept that there may be better formulae to determine the shape of the fund and its administration, and the amendment is not designed to be definitive. It is an attempt to create a scaffold to ensure that adequate resources are made available to fund what the Government described as world-class legislation, and to force those who have profited from this evil to pay for measures to combat it, to support victims and to bring the perpetrators to justice. I beg to move.