Firms which blacklist workers should be blacklisted themselves and barred from being given publicly funded contracts, according to a committee of MPs.

The Scottish affairs committee's interim report on blacklisting published yesterday demands that companies which have been caught should

undertake a process of "self-cleaning," including an admission of guilt and paying compensation.

Committee chairman Ian Davidson MP said: "Had these companies not been caught, blacklisting would still be happening, and we have heard evidence that it is still going on in some areas."

Although blacklisting is now illegal Mr Davidson said it was not enough to just end the practice.

"Reparations must be made and steps must be taken so that we are proactively preventing these practices - and the health and safety problems they lead to - rather than just stopping it when it happens," he said.

"Companies that are caught blacklisting now, or do not make the proper reparations, or do not apply agreed standards of practice in their contracts, should be 'blacklisted' themselves and barred from obtaining any publicly funded work.

"It is impossible to fully quantify the damage that may have been done to people's careers and livelihoods and to their families, as well as to health and safety on site. But restitution must be made."

The MP praised the Welsh government for its "clear and unequivocal ethical stance on this issue" and for providing "a political lead."

And he paid tribute to the activists of the Blacklisting Support Group, which had "fought over a long number of years to maintain this issue in the public eye and to seek recognition for the injustices experienced by so many working people."

Unite assistant general secretary Gail Cartmail said there had been "a conspiracy by some construction firms to deny employment to workers just for raising health and safety concerns or being in a union and speaking up for their fellow workers."

"Momentum is building to run the blacklisters out of town," she warned.

The committee called on the Westminster and devolved governments and local authorities to "use their financial power to ensure that blacklisting is abolished, direct employment is made mandatory and that health and safety is given ever greater priority."