Examination of Witnesses (Questions 260
- 276)
TUESDAY 27 MARCH 2007
MR OWEN
TUDOR AND
MR BERT
SCHOUWENBURG
Q260 Mr Davies: You just agreed with
me, that the benefit which has been generated for producers in
that work is insufficient, you said you are not satisfied with
it.
Mr Schouwenburg: I did not say
it was insufficient, I said I was not satisfied. Those are two
different things.
Q261 Mr Davies: I see. Would you
explain the difference?
Mr Schouwenburg: I would like
to see more of it is what I meant. We can see that Fairtrade is
expanding exponentially, but of course I would always like to
see more going to the producers as a proportion of the value.
Q262 Mr Davies: So what are you doing
about it?
Mr Schouwenburg: As a board, as
an organisation, we are expanding Fairtrade and we also—
Q263 Mr Davies: Why do you think
expanding Fairtrade will change the distribution of the enhanced
value?
Mr Schouwenburg: Expansion alone
will not change that distribution, but part of what we do, as
we see it, is to try and educate consumers to demand these products
and what has happened in the recent development—
Q264 Mr Davies: Leave off creating
the value, we have given you that, you have created the value,
we are talking about the distribution of the value created.
Mr Schouwenburg: What is up to
us is to persuade the retailers to give more of that value to
the producers, which is a different argument.
Q265 Mr Davies: How are you doing
that, Mr Schouwenburg?
Mr Schouwenburg: We do that in
the same way as we have achieved many things in the fair trade
movement, by using consumer pressure to make the retailers change
their ways and give more value to the producers.
Q266 Mr Davies: You are telling the
consumers, "You are giving all this money to Starbucks or
Marks & Spencer's via Fairtrade value, actually not enough
of that value goes back to the primary producers", so what
is the consumer supposed to do about it? Stop buying the Fairtrade
product or continue to buy it and continue to perpetuate the existing,
in your own judgment, unsatisfactory distribution of value?
Mr Schouwenburg: It may not be
perfectly satisfactory, I think you would expect me to say that.
However, it is better Fairtrade as it is now than no fair trade
at all and there is always room for improvement.
Q267 Mr Davies: I think I have drawn
the conclusion from this conversation, Mr Schouwenburg, that you
are not satisfied with the distribution of the additional value
created, and you and your colleagues at the Foundation have not
the faintest idea what to do about it.
Mr Schouwenburg: I think you would
be mistaken.
Mr Davies: Why do you not tell
us what you are going to do about it?
Q268 John Battle: James, we might
press a little bit on what is happening at the producing end of
the distribution.
Mr Tudor: Sorry, Mr Battle, I
am not sure why Mr Davies has presued quite that line of questioning
because the purpose of the Fairtrade Foundation is not to alter
the proportion of the value of the product that is going to the
producer, it is to raise the amount of money that is going to
the producer, which is what it has in fact done in the areas where
it is doing it. There is another question, which I am not sure
is quite the purpose of the Fairtrade Foundation, to then ask
how much extra is the retailer charging for the fact that you
are getting more money to the producer, so you are comparing a
sum with a proportion and I do not think that is how the Fairtrade
Foundation works.
Q269 Mr Davies: I raised this issue
of distribution of the value, it seemed to be a very pertinent
question and I do not apologise to anybody in any way that I raised
the issue. I did not get a very satisfactory answer, but I hope
that as a result of this exchange the Fairtrade Foundation will
think about that issue. It seems to me that there is an issue
of how you have created the value of the brand in the first place,
that has been very successfully done. There is an issue as to
how you continue on that course and create even more value for
the brand and I trust that will happen, but there is also an issue
about how that additional value is distributed between the northern
world and southern world, the primary producers and the distributors
and retailers in the north. That seems to me to be an issue that
the Foundation has not properly addresse; I think that they will
and perhaps when they come back, we will invite them back subsequently
and there will be an answer to that question which, I think you
will agree, is an interesting question to ask.
Mr Tudor: I do agree with that,
but I think it is perfectly appropriate for the Fairtrade Foundation
to concentrate first and foremost on making sure the producers
get an increased return from their labour and that it is more
sensible to spread that first before talking about the fairly
small number of people who get that increased amount and increasing
the proportion they get of the final sum. I think in terms of
priorities, it seems sensible to me for the fair trade movement
to be concentrating on spreading the number of people who get
more money before you address the really rather wider question
of what proportion.
Mr Davies: One final observation,
if I may. Mr Tudor, in answer to some of my questions Mr Schouwenburg
said the answer might be to create more consumer pressure and
I challenged him on that answer. Nevertheless, there is an implied
sense there that if consumers in the west, in the north, the EU
and United States, feel that fair trade is not really very effective
in creating additional value for primary producers or is so much
more effective in creating additional value for the distributors
and retailers in the north than it is for producers in the south
they will feel less motivated to pay those premium prices? While
they pay another $10 a pound for coffee, the example we had this
morning, if only ten cents of it goes to enhanced revenue to the
Ethiopian coffee producer all the rest, and $9.90 goes for enhanced
profits for Starbucks, they will say, "Well, I shan't bother
to pay my fair trade premium and buy fair trade". There is
a danger, it seems to me, that the whole success of the venture,
and therefore the value of the brand, that the distribution of
that value is disproportionate. I will leave you with that thought.
John Battle: I think, Quentin,
we can raise some of the questions as well with our next witnesses,
Traidcraft, who will have heard the tenor of your question and
it does need some response. We will return to it, we are not going
to solve it in the next two minutes, but we need to keep that
question alive in our whole deliberations.
Q270 James Duddridge: A short clarifying
question and a slightly longer question. To clarify, you mentioned
that both the TUC and GMB have received money from DFID. Could
you confirm that is solely the International Development Learning
Fund which was set up in September 2006 and put some figures on
the amount of money received, and then I want to talk about some
of the detail.
Mr Tudor: The International Development
Learning Fund is one of the ways in which the TUC distributes
some of the money we receive from the Department for International
Development to trade unions, so the critical issue is the overall
sum we get from the Department for International Development.
Under the new agreement signed last year, we receive £750,000
over a three-year period—so it is roughly £250,000
a year, but the amount is not constant over each of those years.
On top of that there is the potential for the TUC and individual
trade unions and, indeed, trade unions in other countries and
internationally to apply through the Civil Society Challenge Fund
and the normal routes for applying for DFID support, so there
are extra sums of money secured for specific projects under the
Civil Society Challenge Fund and other DFID systems. Does that
answer the question?
Mr Schouwenburg: As an individual
trade union, we do not get any money at all directly from DFID,
that goes to an NGO, which in this case is Banana Link, that sets
up the Union-to-Union Programme.
Q271 James Duddridge: Is that speaking
for the GMB or is that all the monies either directed via the
TUC or received directly or are individual unions not receiving
money?
Mr Tudor: Some individual unions
are receiving Civil Society Challenge Fund money. I think it is
only Unison at the moment that has an ongoing project funded under
the CSCF. I think the General Federation of Trade Unions has a
development awareness fund budget at the moment. If you need to
know about this, I am afraid I am going to have to supply the
information separately.
Q272 James Duddridge: That would
be great. I am interested in the overall figure rather than just
the £250,000 per annum via the TUC. Perhaps taking a step
back then to a bit of a longer-term explanation of the relationship
through the trade unions and developing countries—could
you talk about some of the outcomes. You suggested you were going
to go back to Mr Bercow in relation to some of details, but perhaps
you could give us a taster of what lessons you have already learned
and problems you have had with the relationship, and how that
might change the interaction between the trade unions in the United
Kingdom and trade unions globally going forward?
Mr Tudor: The TUC is a founder
member of—I am wearing the badge—the International
Trade Union Confederation, which brings together about 300 national
trade union centres in about 150 countries—you will spot
that there are some countries, unlike the UK, which have more
than one—with a combined membership of about 165 million
around the world, 45% of which is outside Europe, as defined under
ILO definitions, ie stretching to Vladivostok, and 45% in the
Americas, Africa and Asia. We have links through that international
confederation with sister organisations, the national centres
in each of the other countries. We have a range of bilateral relationships
which we have established over many years, frequently but certainly
not universally with associations through the Commonwealth, for
instance, a lot of our links are with other trade unions in Commonwealth
countries, but also bilateral relationships with other unions
for various different reasons.
Q273 James Duddridge: If I may, I
am hoping to get some feedback specifically on the International
Development Learning Fund, which I had heard something of, and,
secondly, the Civil Society Challenge Fund, which I was unaware
of before you mentioned it.
Mr Tudor: Those funds pay for
some of our direct relationships both between the TUC in national
centres in those developing countries and individual trade unions
and their sister organisations in those countries. Let me give
you one concrete example, for instance. We have just concluded
a three-year project under the Civil Society Challenge Fund with
the Nigeria Labour Congress about the empowerment of women in
the Nigerian trade union movement. It involved DFID giving us
the funding to pass on to the Nigeria Labour Congress to run a
project employing one project worker and one administrative worker
to produce training courses, run training events, empowerment
processes, campaigns and information exercises to improve the
role of women in the Nigerian trade union movement so they would
have more ability to ensure that what the NLC was doing to bargain
with government and employers was going to reflect more adequately
the position of women in Nigerian society. That is one of the
examples of this.
Q274 John Bercow: I am interested
in that. Are you motivated mainly by a desire to increase the
number of female office-holders in Nigerian trade unions or by
a desire to attract more female members of those unions or is
it a judicious combination of the two?
Mr Tudor: Neither of those, those
are both means to the end. The end we are interested in is improving
the position of working women in Nigeria and we think that both
of those steps are likely to lead to that outcome. We think increasing
the number of women who are members of trade unions is more likely
to make those trade unions reflect the legitimate interests of
Nigerian women workers and it is more likely that the number of
women in those unions will transmit itself into changes in union
policy if there are more women in charge.
Q275 John Bercow: On a social scale
the shape of the labour market is there, perhaps as a result of
the United Kingdom. It might be a reasonable supposition that
the interests of part-time workers are disadvantaged if you have
not got a strong female participation because the proportion of
people in part-time work who are women tend to be rather larger
than apply to men.
Mr Tudor: That would be fair in
both countries actually.
Q276 John Bercow: Indeed, as it is
of course here. Is it the case that you chose Nigeria specifically
because you regard it as the worst case scenario at present or
is it because of some sort of historical link?
Mr Tudor: No. We tend to try and
intervene where we think that the intervention will have most
effect rather than where we think people are in the worst possible
situation. There are trade unions around the world which are in
really grisly situations, like Zimbabwe, for instance, or Colombia
where we engage, to be honest, in the rather more directly traditional
solidarity activities. There are trade union movements, the Nigeria
Labour Congress I think is an outstanding case in point, where
the trade union movement is already an influential one in a country
which is itself influential certainly in the region if not in
the entire continent. We think that intervening in those sorts
of environments is most likely to produce the best gains for what
in this case is taxpayers' money, and in other cases our members'
money, to make sure that we are working with the grain rather
than attempting to assist the least capable. This is basic trade
unionism in a sense. If some of our people did not have power
there would not be any power to help the powerless, so we try
and make sure the countries we pick as our priorities for doing
this work are ones which have viable trade union movements which
can spend the money sensibly and to best effect in terms of outcomes.
John Battle: Could I thank you both very
much again for your contributions to our inquiry.
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