Primark, the cut price clothing chain, has dumped three of its Indian suppliers after discovering that the companies have been using child labour to finish clothes sold on high streets across the UK.

The fashion chain, which has revolutionised British clothes shopping with its "cheap chic", said today that it had cancelled all orders from the three companies involved and removed all their garments from its shelves.

It said that a detailed investigation had found that the three companies had sub-contracted out embroidery and sequin work to a number of unapproved businesses.

In some instances, “the sub-contracting involved home working and in some instances children were found to be working at home”.

In a statement, the company, which is owned by Associated British Foods (ABF), said: “We take this lapse in standards very seriously indeed. Under no circumstances would Primark ever knowingly permit such activities, whether directly through its suppliers or through third party sub-contractors."

Primark insisted that the garments involved represented only 0.04 per cent of its worldwide sourcing.

However, the move will fuel yet more controversy about the pressures placed on suppliers in Asia and the Indian sub-continent by fierce competition among retailers in the UK.

Following recent expansion, Primark has threatened to take Marks & Spencer’s crown as the nation’s favourite clothes shop. Its market share has grown 2 per cent in the past year and Primark remains one of the few high street chains untouched by the credit crunch.

Today, Primark said that it would be taking “urgent steps” to further tighten control of its other suppliers.

It added: “Primark’s prices are low because we don’t overcharge our customers.

“Most of our clothes are bought from the same factories as other fashion retailers and people producing them are paid exactly the same, whatever the label and whatever the price in the shop.

“We are able to offer good value and good quality because of the low mark-ups and big volumes.”

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