Examination of Witness (Questions 271-279)
Wednesday 4 June 2003
Dr Jennifer Frances
Q271 Chairman: Dr Frances, welcome
to the Committee. You have no doubt been following our inquiry
into this and, no doubt, will have come to the same conclusions
we have, that it is getting quite difficult to pin things down
and to get anything rather precise on all this. Indeed, there
are occasions when we wonder who is really inconvenienced by the
whole process. Out attempts to get from the Government and others
any sort of clear idea as to what they think are the dimensions
of the problem I have to say have not been terribly successful.
The Government does claim that it really cannot estimate the amount
of work contracted to gangmasters or the money involved. Do you
think you can help us in that regard? How reasonable is that defence?
Dr Frances: I think
it is perfectly reasonable at the present time that the Government
can claim that it does not know the size of the problem and I
do not think immediately could give you those numbers. I think
that there are mechanisms in place perhaps to discover those numbers
more accurately. As in my memorandum, it states that this has
been a long historical problem that dates back to the origin of
the system, which as I said goes back to the 1820s. There has
been a very long period since the 1860s of the Agricultural Census
but it has not had any interest in gathering labour statistics,
it has only been interested in knowing what was being grown in
the land. Up until the 1950s casual and permanent part-time labour
was lumped into one group, so even in the post-war era we never
had any valid statistics as to who was working. Over time this
has just become an impossible area to discover. Are there certain
other aspects that you would like me to elaborate on?
Q272 Chairman: You said that there
are mechanisms which might allow us to work this out. Would you
like to tell us what they are?
Dr Frances: I am just thinking
this through for you. I would like to start with the term "gangmaster".
The term itself is difficult because what actually defines a gangmaster
as compared to somebody who wants to now call themselves a labour
agency which supplies casual workers into agriculture or, in fact,
any of the businesses in distribution or food processing, I would
take that as one and the whole. Secondly, with the labour agencies—Sorry,
I would like to think a little further because it is quite a complicated
thing to explain. The gangmaster is no different from any other
form of labour agency except he has a long historical connection
with supplying agricultural labour, but he does not only supply
agricultural labour, he supplies into packhouses which may or
may not be registered to agriculture and the people may or may
not be counted, and this you already know. He may well be supplying
into a whole range of industries. If we are going to define gangmasters
as people who are specifically supplying labour into packhouses,
whether or not they are assigned to agriculture, having a holding
number, if we define it as that then the people going there can
be counted because already the law exists that whenever a grower
takes on the services of a gangmaster, as I have defined, then
they have to inform the Inland Revenue of the name of that gangmaster,
the name of the subcontractor, they have to inform the Inland
Revenue every time that gangmaster changes the name of his business
or takes on any other subcontractors, and they also have to keep
weekly or daily records of who go to packhouses. That information
already goes to a special tax office in Cardiff. If they are in
any doubt about whether these records are accurate or not they
have the ability, instead of the gangmaster doing PAYE or National
Insurance, they have the authority to make the grower do that.
I think there are methods and that is one of them that exists
already, if you like, in statute as a legal requirement. There
is another area where I think we could get to know more, if you
would like me to go on.
Q273 Chairman: Please.
Dr Frances: The way that the supermarkets'
business models are organised, they have organised themselves
to be extremely efficient businesses and, as we know, they are
some of the most efficient businesses in the world. We make more
profit on our supermarket retailing than any other. One of the
ways in which they have been able to achieve this is by minimising
the amount of information they have to deal with. They do not
suffer from data overload and they do not carry any of the costs
of the buffers in the supply chains, the food chains, in which
they operate. What this means is since the late 1990s, instead
of dealing with 20 suppliers—say this is for lettuce, let
us just take one product, or fresh produce—and prior to
that they dealt with 40 or 100, they have narrowed down the responsibility
of the supplier and they have a system called category management
where you appoint one supplier to manage the other suppliers.
What has happened is as this goes further and further down the
chain there are less and less buffers and the people who are taking
that are obviously the people in the fields. One of the ways is
one could simply ask the category managers, the grower, and their
growers to name who they are working with. A snowball sample is
very effective, just simply ask "Who do you deal with? Can
we have a list of people you deal with". I would not like
to put a number on it but there will only be a handful of category
managers of fresh produce and they, in turn, will know their suppliers.
Q274 Chairman: We live in an age
in which we talk increasingly about corporate responsibility and
the social responsibility of corporate bodies. Insofar as the
supermarkets presumably know that there is an argument about the
conditions of people who work in the sector, and insofar as you
have said that they have arranged matters, for perfectly good
business reasons, where they do not have to ask themselves the
question, do you think there is a failure of corporate responsibility
there?
Dr Frances: It is very difficult,
is it not? If I were to try and take a balanced view, if I were
looking as somebody who is selling food and being the grocer I
would ask myself why am I responsible, or how could I be responsible,
for something which is so many layers down the food chain. I think
in times past we would not have expected people to be responsible
in that way but the business models have changed so radically
that the grower no longer can produce something which goes to
an open market where the price is named and prior to it going
he can calculate his labour and pay his labour and that would
be finished with. Those systems have changed. Given the desire
of the supermarkets to have control throughout the food chain
network then I think there has to be some responsibility, but
that is a double-edged sword because the last thing that the growers
would want is for the supermarkets to have further responsibility
because if we were to say "Right, you must do something about
labour", already since the late 1990s they have run ethical
audits and if one was giving them more authority to delve into
the growers' business they would just apply further downward pressure.
The issues that you are looking at cannot be solved in that way,
neither do I believe they should be solved through further legislation.
Chairman: We are going to come on to that in
a little while.
Q275 Mrs Shephard: You have described
how you think supermarkets' methods and systems have changed and
you have also been extremely fair in saying that you think some
of this is inevitable. Have you had the chance to look at the
way that demand for casual labour, and/or gangmasters who provide
it, has changed over the last 30 years?
Dr Frances: Yes. That is where
the heart of the problem lies. As far as we know, because there
has been no academic research on it at all and the last person
who had any interest in it was a woman called Ivy Pinchbeck in
the 1930s who used the parliamentary reports of the 1800s and
drew the conclusion that this form of labour had died out except
in a few quirky places in Norfolk, of course, which was not the
case, and I would suggest that it never died out, that it has
been used throughout the UK, it is not just an East Anglian phenomenon,
up until the 1970s, when we shopped in greengrocer's shops and,
as we probably remember, we brought home potatoes with dirt on
them and possibly a few stones in the bag as well, women gangs
were used mainly in small gangs, and travellers, and we were prepared
to pick goods that went to market. With the—
Q276 Chairman: Half-term in my school
was for potato picking.
Dr Frances: Absolutely.
Q277 Mrs Shephard: And early summer
holidays and Easter holidays in rural schools in Norfolk right
up until the 1970s.
Dr Frances: Yes.
Q278 Chairman: A bit of nostalgic
detail.
Dr Frances: Carrot topping and
onion peeling were all good jobs for probably under-age children,
etc., and so on. If you were a woman and obviously family life
was such that there were not many jobs for rural women, and also
you had family responsibilities, you had somebody to provide you
with transport at 7.30 in the morning, you finished by 3.30, so
you saw the children off, you saw your husband off to work and
you were home and could do a meal, this was women's work. It was
picking and lifting crops and they went to market. Supermarkets
discovered in the 1970s we had moved from the High Street to much
larger edge of town superstores and we needed different forms
of supply. We found that people consumed more and we wanted more
added value. We did not want to buy the potatoes with the dirt
on them, we wanted them washed and so on. I think this is now
a familiar story to us. We know the enormous amount of added value
which is done and we are virtually buying stuff which is already
prepared. It is not just supermarkets, it is catering as well,
the rise of sandwich making and the ingredients into sandwiches
and other such prepared meals and so on. At the same time, of
course, the supermarkets offered jobs and transport became better.
Certainly in East Anglia there were a lot more car owners and
why would these women want to do a job when they had better prospects.
For people who wanted to work short hours, if you like, this system
was a bit of a victim of success really. The women moved into
the packhouses and had regular jobs because it was in the packhouses
where the washing and preparation of vegetables took place and
the added value and more jobs were created. At the same time you
still required the temporary labour, and when I say it is temporary
or casual, although it is hired on a day-to-day basis there is
work for casual labour almost 365 days a year, and you had this
increased pressure. The other problem in all this about demand
is that casual workers, particularly agricultural workers and
packhouse workers have been deemed unskilled. Certainly they are
not skilled in the definition of it by having levels of qualification
but they are highly skilled in the sense that they do not damage
the crop, they have got the aptitude for the work and they themselves
can make a profit from the job that they do, being paid on piecework.
Where are the extra people going to come from? At a very basic
level it takes 20 years to get a human being ready to work. You
cannot just conjure up people. We then saw the change in the market
and at that point we saw the increase in the SAWS scheme, in the
seasonal agricultural workers. There is a demand for more of them
to come in and there is a demand, as we have seen, from Eastern
Europeans. It is a long trend. The increase in demand for labour
in the fields goes back really to the late 1970s.
Q279 Mrs Shephard: I was interested
in what you said about the corporate responsibility question being
a difficult question and the fact that the supermarket bosses
are rather a long way from what is happening in the fields. On
the other hand, there is an interesting and rather unpleasant
analogy to be drawn between the preoccupations of supermarkets
with humane methods of treating poultry, for example, they are
not far from that, and yet if you look at the conditions under
which some of the foreign workers are housed and paid and not
looked after, they are quite a long way from that. Do you not
find that a bit odd?
Dr Frances: Yes. I would not on
any account want to look for excuses or to deny the poor working
conditions of both illegal migrant and indigenous labour, and
there is no defence against poor conditions, illegal practices,
but those practices are not specific to agriculture, they go from
boardrooms across a whole wide range of industries. What I feel
here is that, yes, the supermarkets, I believe, do have a bigger
and better role to play in this but I do not think it is as simple
as saying they should audit labour in the same way because there
are just so many loopholes at the moment in areas that I think
could be dealt with. I do not think any benefit would come. I
think in understanding the supermarket business model, to just
say to them, "Yes, audit", as they do for their suppliers
and a whole host of things, that will not bring about the desired
result because that will be pushed on to the grower who is very
stretched already. The whole reason that the gang system has grown—Let
us face it, what it is is a flexible labour market that, in the
quotes of my interviewees, "can be turned on and off like
a tap". It is the business model of the supermarket and the
nature of their contract with the grower and their success in
us purchasing the goods that they put before us that I think is
creating the problem. They are creating jobs, in other words,
because we want things packaged, because we want another label
on things, because we want something more prepared and the labour
is being pulled in.
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