Subsidised out-sourcing: London Assembly members question Boris

China prices can be cheaper than other low-wage economies. Quotations are often for large quantities, the Chinese government has no pension, healthcare or democracy costs, and governments east and west have manipulated the exchange rate, but another surprising reason is that the UK taxpayer subsidises introductions and training, and hectors fashion designers to use China specifically. The money is paid from funds paid in London to reduce disparities in the Labour market.

"Making it ethically in China – A practical guide for fashion and textile designers When: 28.10.09 at 18:00 Where: Asia House, 63 New Cavendish Street, London , W1G 7LP
Sourcing materials or manufacturing in China should be considered seriously if you want to compete in a global market and keep production cost low. Many do not think that China should be your first port of call if you have decided to build your brand on a sustainable business model in which worker's rights are recognised, the materials used are environmentally friendly and your carbon footprint is as small as possible. However..."

The event organisers were given £210,000 by the London Development Agency last year, and this year's money is paid £7,380 from Creative Connexions, which is also funded by the LDA.

Creative Connexions explanation of its own funding reads, "The Government provides full backing to the scheme, with a £5 million grant from the Higher Education Innovation Fund covering our first two years.", and lists UK Trade and Investment, London Development Agency and Think London among it's "partners". The company uses West End offices at 65 Davies Street owned by University of the Arts and is headed by an American-trained former Monsanto employee with experience in "global sourcing". Officially the company doesn't favour China but "seeks to link the creative skills of the U.K. with the developmental opportunities in China and India." However Indian factories would have trouble competing with their rivals in a more autocratic state; Labour Behind the Label notes a report of other far-eastern garment workers being told by Western retail chains to keep their prices as low as China and Vietnam.

Back in London, Dee Doocey the Liberal spokesperson on the London assembly was "very happy to pass on ... concerns about this event to the London Development Agency", while the Green spokesman, Darren Johnson tabled a formal question to the Mayor of London.

"Do you think it appropriate that the LDA funded a seminar entitled "Making it ethically in China - a practical guide for fashion and textile designers" given that the LDA's remit is to promote employment prospects and enterprise in London rather than encourage businesses to outsource their production abroad? "

A similar event planned in Manchester "Making a name in China – a practical guide to marketing and expand... has had it's date and time removed from the Own-it web site but remains advertised on Own-it North. It will be held at Chinese Arts Centre, Thomas St, Manchester , M4 1EU, on 12.10.09, 6-8pm

supported by London Development Agency - working for the Mayor of London

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Comment by on November 3, 2009 at 20:15
Hi Tasmin
I'm glad there's common ground because the questions in the London Assembly look to me like a complaint at hosting events like "making it ethically in China", rather than part of a debate. An attempt to draw attention to something that is obviously wrong. I intended the blog post as a complaint, and hoped for a statement that more views were held in common and something would change.

If the Ethical Fashion Forum promoted a talk to the buyers from Terra Plana, People Tree, Pentland Group, or the consultant for Nike who says "you can't choose between countries", I could see the purpose, but it doesn't. These are the people on the platform, a the expense of UK taxpayers, urging others to join them in buying from the cheapest country.

Do you see the problem?
John Robertson
Comment by Tamsin Lejeune on October 28, 2009 at 16:05
Hi John,
Ive not had a chance to respond to your posts, however I agree with many of your points. We should not be encouraging production in China at the expense of production elsewhere. However, if production is happening in China, then lets do what we can to make it as sustainable as possible- because at the moment, as you point out, it is not.
We unfortunately do not have people on our team paid to offer business support- though we do have a dedicated team of volunteers doing what we can to make sustainable practices easier- including production in the UK. We have done quite a lot of work to collect information on UK based production and promote that as an option to the many designers who contact us every week. We would be very interested in your suggestions of factories and production units in the UK that we can recommend.
Comment by on October 19, 2009 at 16:38
Just seen that your own products are IFAT certified and made in India: good luck with them!
Comment by on October 19, 2009 at 16:32
Hi Mills
I half agree. The Ethical Trade Initiative does do some work trying to standardise corporate social responsibility in China, but in its own words

“CSR in general has become a bit of a victim of its own hype … we have to stop pretending that companies in and of themselves can on their own transform industrial relations in foreign lands.”

On the other hand, niche-market shoes and clothes are still made in the UK. Asos with it's lower distribution costs has started a "made in England" section, to sell UK-made stuff that the big-name retailers won't touch, but that people obviously want.

Way back in this thread was a piece reporting London Assembly members, questioning why London taxpayers are paying for an event called "Making it ethically in China", advertised with an instruction to niche-market designers to "seriously consider" outsourcing. This is what I disagree with: the taxpayer-funded help intended for niche-markets like high fashion and new designers going to promote out-sourcing. Upmarket and niche market shoes can't easily be made in China, and if they're imported, don't have to come from such an autocratic country, so I think the event called "Making it Ethically in China" is all a bit of a muddle and should be cancelled. After all, if the niche-market short-fun factories close, specially in footwear, how are the next generation of fashion designers going to start?
Comment by on October 17, 2009 at 18:56
Hi Tasmin
Just been thinking of a more direct answer.
Requests for out-sourcing help is not a justification to provide out-sourcing help or write to everyone on the mailing list and ask them to "seriously consider" China. I didn't know that there were full time staff at EFF and wouldn't have dreamed of asking for help. Is it true that you have people paid to provide business help and if so have you tried to put lists together of all the firms in the UK phone book or Kelly's of Kompass and sent a card or made a phone call to find out whether they need anything?

About London being isolated or not isolated: obviously Primark sells Chinese Vietnamese and Cambodian goods in UK high streets - including London's high streets - but that is not always a reason for the UK taxpayer to give free advice to Primark. It may be, in a far-sighted way, but only with very strict controls to prevent the money being used to subsidise out-sourcing and putting people in Europe out of work..

Lastly, I don't think the market in free trade is clean of efficient. I don't think that Chinese labour will get the rights of Taiwanese labour any time soon because the government there doesn't want it. Likewise in Arabian countries that provide cheap imports. So the hope that living standards in industrial parts of China will soon compare wth Europe is a forlorn one. Also, the exchange rate is fiddled. Our government here in the UK hiked-up exchange rates by hiking-up interest rates to nearly 20% just about exactly 30 years ago. Soon something will happen in the opposite direction. If you want to invest in China to cover yourself it's hard: there are Chinese laws passed for precisely the opposite reason: to prevent foreighn speculators raising the price of the Chinese currency and putting Chinese people out of work.

We live in a globaized world with a dirty, politicised free market and several different ethics involved in it.
So I don't think people should be instructed to buy chinese and subsidised by UK taxpayers in their efforts to do so, which is what got me going
Comment by on October 5, 2009 at 8:38
Three point plan for any politician:
1) Ask development agency colleagues to renew funding for schemes like the London Apparel Resource Centre (just closed) and Metropolitan Works (not answering emails) so that UK fashion designers have some chance of making their small runs. This is particularly important in for footwear, which usually can't be made without heavy machines. Replacement schemes could be run by existing colleges or commercial factories. There's also scope for MPs to adapt the planning permission system so that the tools of a large factory are listed as well as the purpose of the building. That way it can't be sold for housing, the value falls, and it remains economic for someone else to run it as a factory if the current owner pulls-out.

2) ask EU colleagues to introduce import tariffs in reverse proportion to the civil and welfare rights of each country, but regardless of wealth. So a poor african country that has good government and expands the number of free hospitals gets a low import tariff or none, while China gets a massive tariff. I guess that production costs will always be higher in a country where taxes pay for hospitals pensions and the rest. It will be a long wait until every country in the world has these, and there's a question to be asked about why UK workers should have to compete with China on Chinese terms meanwhile. Also, with about a quarter of government spending borrowed now that the banks have had to be rescued and three million people unemployed, this is a short-term question: how can the UK re-vitalise manufacturing now?

3) ask MP colleagues at the Treasury to change the way Monetary Policy Committee members are appointed, and take Bank of England advice on how to stop the pound being over-valued against other currencies. In 1979 interest rates shot-up to about 15%; the pound rose massively, a large proportion of industry closed, and nobody has since said "sorry", or "we have a different system now", or "the sort of people who made those decisions could never be appointed now".
Comment by Tamsin Lejeune on October 4, 2009 at 22:01
Hi Veganline

This is an interesting one. At the Ethical Fashion Forum, we run regular training events and the most common request we have had is for events on how to manage sourcing from China. The fact is that the majority of fashion is now sourced from China. It is not possible to talk about fashion and sustainability and omit the discussion of China.

There is no doubt that there are ethical concerns with sourcing from China. Hundreds of fashion industry professionals are concerned about that- we receive their emails every week. Often working within companies with a remit to source from China, they want to do something about it. This event is offering advice and support to do just that- and it will make a difference for workers in China. London is not isolated- we live in a globalised world. It is long sighted of the LDA to see the relevance of the conditions for workers in China , and the environmental impact of factories there, to our lives in London. It is not until conditions improve elsewhere that we will be able to compete again as a manufacturing hub for the fashion industry.


hat is certainly the best way to ensure ta

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