Primark UK and Loblaw of Canada urge other companies to help families of Bangladesh building collapse workers

The UK high street retailer Primark and Canadian counterpart Loblaws have announced they will compensate the victims of last week's collapse of a Bangladeshi factory complex where suppliers of some of their clothing lines were located.

The illegally constructed, eight-storey Rana Plaza collapsed in a heap while thousands of people were working inside in five garment factories that supply leading western brands including Primark, Matalan, Mango and Benetton.

About 2,500 survivors have been accounted for so far. Rescuers were using heavy machinery on Monday to cut through the debris after giving up hope of finding any more survivors.

The British-owned Primark, which said that the payment would include long-term aid for children who had lost parents and financial aid to those who were injured, also urged other clothing retailers who had suppliers based in the factory near Dhaka to come forward and offer assistance.

But the company stopped short of meeting the demands of campaigning organisations and trade unions to sign up to a building safety action plan aimed at preventing a repeat of the disaster, in which at least 382 people were killed.

Announcing the compensation package on Monday, Primark said it had joined with a local non-governmental organisation (NGO) to address the immediate needs of victims, including the provision of emergency food aid to families.

It added: "This will include the provision of long-term aid for children who have lost parents, financial aid for those injured and payments to the families of the deceased.

"Primark notes the fact that its supplier shared the building with those of other retailers," said the retailer, whose supplier, Simple Approach, had occupied the second floor of the eight-storey Rana Plaza building that collapsed.

"We are fully aware of our responsibility. We urge these other retailers to come forward and offer assistance."

Canadian counterpart Loblaw Companies Ltd, which had some of its Joe Fresh clothing line manufactured at Rana Plaza, said it too was offering compensation. "We are working to ensure that we will deliver support in the best and most meaningful way possible, and with the goal of ensuring that victims and their families receive benefits now and in the future," spokeswoman Julija Hunter told the Associated Press.

A petition drawn up by the National Garment Workers' Federation, which called on Primark, Matalan and Mango to pay compensation to victims' families and to sign up to the Bangladesh fire and building safety agreement to prevent future deaths of garment workers, has so far received nearly 600,000 signatures.

Responding to calls for it to sign up to the agreement, a spokesman for Primark said that the issue of structural integrity was complex and that buildings had multiple ownership, tenants, floors and many international customers.

He added that Primark would work with fellow members of the Ethical Trading Initiative (ETI), a UK-based grouping of retailers, unions and NGOs, "to agree and monitor an effective methodology to assess structural integrity, which can then be universally adopted".

"An equivalent action plan on fire safety has already been endorsed by the ETI and its members, demonstrating the effectiveness of this approach," he said.

Earlier on Monday, the Italian retail multinational Benetton admitted that it had been supplied for a one-off order by one of the factories in the building. It had previously denied any links with the businesses there.

The company's U-turn came as a Bangladesh court gave police 15 days to question the owner of the building. Mohammed Sohel Rana, who was arrested on Sunday as he tried to flee to India, will be held for questioning on charges of negligence, illegal construction and forcing employees to work in the building. His father, Abdul Khaleque, was also arrested on suspicion of aiding Rana to force people to work in a dangerous building.

Benetton's announcement follows the publication by the Associated Press of pictures of clothes bearing its labels in the debris. On the day of the tragedy, the Italian firm issued a statement saying: "None of the companies involved are suppliers to Benetton Group or any of its brands."

The new statement said: "Regarding the tragic accident in Dhaka, Bangladesh, we wish to confirm that none of the companies involved is a supplier to any of our brands. Further to this, a one-time order was completed and shipped out of one of the manufacturers involved several weeks prior to the accident.

"Since then, this subcontractor has been removed from our supplier list. A programme of random audits take place on an ongoing basis throughout our global supply chain to ensure that all direct and indirect suppliers comply with our long-standing social, labour and environmental standards."

New Wave Bottoms, one of the manufacturers based at Rana Plaza, lists Benetton as a client, while labour rights activists digging through the debris also said they found documents linking Benetton to the factory.

Bonmarché, a retailer with more than 200 stores across the UK, has acknowledged that its products were made in the block, while the UK chain Matalan also said it had been supplied from the factory in the past. The Spanish chain Mango said it had planned to obtain samples from a supplier in the complex.