Nick Clegg responds

October 12, 2014

Since the launch of Traidcraft’s Justice Campaign just over a month ago, hundreds and hundreds of campaigners have sent emails and postcards to the main party leaders. And after a period of resounding silence, at last we’ve had a response from one of the parties.

Over the weekend campaigners up and down the country received an email from Nick Clegg’s office. The full text of the email is below.

What to make of it? Well, it’s great that they were first off the blocks, but it does read suspiciously like a standard response covering all the big development campaign issues of the last few years. Aid, tax dodging and debt all get a mention. Could it be a ‘cut and paste’ job? We couldn’t possibly comment. But perhaps we should take a moment to give a thumbs up to our friends and allies who have worked tirelessly to get these issues on the agenda. Just shows what you can achieve through campaigning!

But on holding UK businesses to account in the UK… the response skirts round this issue so elegantly that you almost wouldn’t notice it was missing. Almost.

Actually it isn’t quite missing. These few lines outline their approach:

Liberal Democrats believe it is also important that the UK takes a leading role in helping other countries to legislate against tax dodging, companies abusing workers and mistreating people in the countries in which they operate.

 

So the solution (according to the Liberal Democrats) is for the UK to help other countries legislate against companies abusing workers and mistreating people where they operate.

This misses the point (quite spectacularly). There are laws against abusing workers and mistreating people in most countries. The point is that they aren’t working for victims.

There are several reasons why this is the case. Access to lawyers and funding for cases is hard. Judicial systems are often underfunded and weak – particularly when pitted against powerful and well-resourced international companies. National governments eager for trade and investment may even suppress criticism of foreign investors.

Above all victims need to have access to a robust system of justice in countries where companies can be held to account. For businesses which make their headquarters in the UK, that means here.

That’s why we’re calling for the next UK government to do the following:

  • Make it possible to bring criminal prosecutions in the UK against British companies that abuse human rights in other countries.
  • Remove the barriers which stop people from poor communities bringing civil cases in the UK courts.
  • Ensure that companies can also be held to account effectively outside the court system.

The letter ends: ‘Please be assured that Liberal Democrats are leading the way in getting big businesses to take responsibility for their actions and I can assure you that we will continue to do so after the next general election.’

We look forward to it, Nick.

You can still email Nick Clegg and the other UK political leaders to ask what they plan to do to bring justice for victims of UK companies.

Full text of the email:

Thank you for writing to Nick Clegg in support of Traidcraft’s Stand up for Justice campaign. I am replying on his behalf.

The UK has a proud record of helping the poorest and most vulnerable people in the world. The Liberal Democrats are proud of the fact that we were the first country to meet a commitment to spending 0.7% of our Gross National Income (GNI) on international aid. The aid we provide to the poorest countries is vital in building a safer, more stable and prosperous world, which in turn, helps keep our own country safe and secure. However, the Liberal Democrats want to go further so that future governments are bound to our commitment – Liberal Democrat MP Michael Moore currently has a Bill going through Parliament which will enshrine in law our commitment to spending 0.7% of our GNI on development aid.

The contribution of UK taxpayers saves 3 million people from poverty each year and has helped to eradicate smallpox, reduce the number of polio cases and increased the number of people on anti-AIDS drugs. It also helped send over 10 million children to school last year.

Just as we are leading by example with our foreign aid commitments, Liberal Democrats believe it is also important that the UK takes a leading role in helping other countries to legislate against tax dodging, companies abusing workers and mistreating people in the countries in which they operate. The vast majority of UK companies operating abroad are responsible but a minority continue to behave in a way which damages the UK’s reputation and harms those they should be helping.

At last year’s G8 summit, the UK reached an agreement with other major countries to establish the automatic exchange of information between tax authorities to crack down on tax dodging. The UK Crown Dependencies and Overseas Territories have also joined up to this initiative, which will boost our ability to tackle cross-border tax evasion.

We have made huge strides in tackling tax avoidance. Last year, we secured a record £23.9 billion by clamping down on tax evasion, avoidance and fraud, but it’s only right that we share our techniques with other countries. Global tax avoidance can only be addressed if we work together, and this is why we are supporting tax capacity projects to help developing countries increase their tax revenues. We’re working with international organisations such as the African Tax Administration Forum, the World Bank and the OECD to provide technical assistance. Last year, we announced almost £10 million of new funding to support projects to tackle tax avoidance in developing countries.

When we chaired the G8 in 2013, we made tackling tax avoidance a priority and we are already seeing the results of our hard work. In January this year, the Treasury announced that it had received £340 million from the Swiss Government following an agreement we made with them to tackle tax avoidance.

Action on all these issues needs to start at home and we need to set an example. In April this year, Liberal Democrat Business Secretary Vince Cable announced plans for a list of true company owners, because for a company to be trusted we need to know who is really in charge. UK companies will no longer be able to use complex structures and trails of paper to hide information behind bogus owners and directors.

We have legislated to protect vulnerable countries from exploitative ‘vulture funds’, through which creditors extract harsh and inequitable payments from poor countries, and thanks to our action, those running vulture funds can never again use UK courts to exploit poor countries.

I hope you find this information helpful and thanks again for getting in touch. Please be assured that Liberal Democrats are leading the way in getting big businesses to take responsibility for their actions and I can assure you that we will continue to do so after the next general election.

Best wishes,

**Edward Simpson**
Office of the Rt Hon Nick Clegg MP