Traidcraft and Fair Trade — [Mr Philip Hollobone in the Chair]

Part of the debate – in Westminster Hall at 10:00 am on 18th December 2018.

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Photo of Stephen Timms Stephen Timms Labour, East Ham 10:00 am, 18th December 2018

I am delighted to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend Liz Twist on the initiative to secure this debate and on what she said. I also very much agree with what Jim Shannon said.

I draw attention to my entry in the Register of Members’ Financial Interests, where it is recorded that I am the unpaid chair of the Traidcraft Foundation trustees. I will say a little more about the work of that body later in my remarks.

In 2007, Sainsbury’s announced that it would in future sell only Fairtrade bananas, a commitment that it has maintained to the present day, with 100 million a year of those bananas coming from Saint Lucia. At the time, a press article described the impact of that decision, under the headline, “Saving St Lucia: UK supermarket sweeps up 100m bananas”:

“Just seven years ago the banana farmers of the Caribbean island of St Lucia were hanging up their machetes and ready to turn their steep hillsides back to forest. UK subsidies for their fruit were doomed, they couldn’t compete with giant ‘dollar’ bananas from South American plantations, and a dying industry seemed to provide only back-breaking work for scant reward.

Today, the island where bananas are not so much a crop but a way of life is celebrating. Just about every St Lucian banana sold for export now commands a premium price and European supermarkets are queuing for more. Money is going into run-down schools, the banana sheds are being repaired and the farmers can scarcely believe the turn round in their fortunes.”

A remarkable change had taken place. The article went on:

“In a reversal of the situation nine years ago where only the Co-op was prepared to stock fair trade products”—

I join Jeremy Lefroy in paying tribute to its role—

“the big supermarkets now openly compete with each other to be socially conscious.”

How did that turnabout occur? What was it that changed the retail market in the UK to deliver such huge benefits to struggling farmers in the developing world growing bananas, coffee, tea, cocoa and other products? In a word, it was Traidcraft.

Traidcraft, as my hon. Friend the Member for Blaydon said, was established 40 years ago. It described itself as a “Christian response to poverty”. It started with hand-crafted items from Bangladesh, and still sells those. Together with the chair of Traidcraft, Ram Gidoomal, my wife and I visited some of those producers in Bangladesh in 2012. Traidcraft has always had a focus on support for women producers as the most effective way to raise family incomes.

Traidcraft started with those craft products. In the 1980s, the idea of fair trade was pioneered in the Netherlands with coffee, and Traidcraft brought the idea to the UK. What happened, in effect, was that people who ran church bookstalls were persuaded to offer some crafts and fair trade items for sale on the edge of their collections of books. You might be forgiven, Mr Hollobone, for thinking that a few bookstalls in draughty church halls around the country were never going to change anything much but, ultimately, they brought about that change of fortune for the banana farmers of St Lucia, even though neither they nor Traidcraft ever sold any bananas.

Voluntary, community-based support, initially in churches and then increasingly elsewhere—for example, Fairtrade schools—enabled the fair trade movement to get a toehold to start with, to survive and to go on to flourish. Today, fair trade has a large niche in the UK retail market—Fairtrade sales volumes rose 7% last year.

Traidcraft established itself as a plc. As my hon. Friend pointed out, it has 4,500 individual shareholders, buys groceries and craft items from more than 70 producer groups in some 30 countries, and sells them through community fair traders online, dedicated fair trade shops and mainstream retailers. To secure Traidcraft’s focus on its core mission, as a Christian response to poverty, it established the Traidcraft Foundation, which I chair. It has a golden share in the plc to ensure that the initial focus is maintained.

Traidcraft Exchange, the sister charity which does a lot of the producer support work that the hon. Member for Stafford rightly highlighted in his intervention, was established in 1986. It continues to thrive, to support low-income producers in Africa and Asia to grow their business, and to campaign in the UK. For example, a few years ago it played a key role in the campaign to establish the Groceries Code Adjudicator to secure fairer access to the retail market. My hon. Friend Catherine McKinnell in her intervention mentioned the “Who picked my tea?” campaign that it led, drawing the attention of consumers to questions about the working conditions and circumstances of those who pick the tea that we all enjoy.

Traidcraft played a key role in the establishment of the Fairtrade Foundation in 1992. It also developed the Geobar, which proved to be a phenomenally successful product, I am pleased to say. The Geobar generated substantial commercial success for the company and underpinned its activities for a long time. In recent years, however, as my hon. Friend the Member for Blaydon pointed out, Traidcraft has struggled to make a profit for the reasons that she set out: the wider challenges in the UK market, Brexit and the fall in the value of the pound.

Traidcraft had quite a specific role as a pioneer in fair trade and, with fair trade being taken up widely by retailers—supermarkets have lots of their own-brand fair trade products these days—the position of Traidcraft in establishing its own niche and commercially viable market has been a difficult one. It struggled to make profits. Last summer, Traidcraft under its then recently appointed chief executive, Robin Roth, after some disappointing sales figures, took the view that things could not carry on. It was decided to rethink the business model, to downsize radically—losing more than 60 jobs, as my hon. Friend pointed out—and in the new year to go forward with only 12 staff, outsourced warehousing and a focus on the grocery business. I am pleased to say that Traidcraft has had a good autumn of sales. There has been tremendous support from the community in my hon. Friend’s constituency and in the north-east more generally, which has helped to buoy it as well.

Fairtrade continues to do well in the UK. I have referred to the fact that its sales volumes rose by 7% last year. It is important to recognise that, notwithstanding the difficulties that Traidcraft has been through, fair trade continues to enjoy strong consumer support.

Traidcraft has a remarkable story. Its pioneering role helped to create fair trade as an enduring segment of the retail market. Committed volunteers in churches led the way, but the support for fair trade is now very widely based, placing it squarely in the mainstream of today’s retail marketplace. Polling shows that awareness of and trust in the Fairtrade mark are at the highest level they have ever been since the Fairtrade Foundation was established in 1992 and started polling on the views of the Fairtrade mark a couple of years later.

Traidcraft has been through a difficult phase—hopefully, it will emerge leaner and stronger with new investment in the new year—but the values that Traidcraft has championed enjoy greater support than ever in the UK. I hope that in his remarks, the Minister—I am pleased to see him in particular in his place for this debate—will confirm that the Department for International Trade will want to uphold those values as it develops future trade policy. Such decisions are crucial for farmers and producers in the least developed countries and in other developing countries around the world.