The Bishop of Derby has pressed the issue of tax dodging in the House of Lords.

Bishop Alastair Redfern asked the Government what steps it was taking to ensure that multinational corporations are "compliant and transparent" in their dealings with developing countries.

The Lords debate was welcomed by Christian Aid, which estimates that poor countries are losing around $160 billion a year because of tax dodging by multinational companies, a figure that equates to more than the amount they receive in aid.

Baroness Northover gave assurances of the Department for International Development's commitment to "promoting responsible business conduct" by multinational companies in their dealings with developing countries.

She added that the UK was working in partnership with the Ethical Trading Initiative to promote better working conditions in the supply chains of its member companies.

Bishop Redfern asked the Government to ensure that companies working in developing countries pay the taxes they owe.

The Treasury’s Commercial Secretary, Lord Sassoon, replied by saying that the Government was working to bolster developing country tax administrations to ensure that they can collect the taxes due to them.

Christian Aid’s Principal Economic Justice Adviser, David McNair, welcomed the bishop’s questions and urged the Government to push for legislation to ensure profits made in developing countries cannot be hidden offshore.

He said: "Christian Aid is delighted that the issue of tax justice is being examined in the House of Lords.

"The matter of lost tax revenues from the world’s poorest countries is an ethical and moral issue on which faith leaders are beginning to take a lead.

"We now need action at a political level, to ensure transparency between multinational companies and the developing countries where they operate."