Ministers have vowed to tackle forced labour in supply chains to mollify MPs after asking them to remove legal protections from the Great British Energy bill.

Labour MPs were whipped on Tuesday night to strip out an amendment intended to ensure that companies using forced labour do not drive the UK’s green energy transition.

The House of Commons voted by 314 to 198 to reject the amendment, made in the House of Lords, which sought to stop public money from being spent by the state-owned GB Energy on solar panels and other materials where there is “credible evidence of modern slavery” in supply chains.

No Labour MPs rebelled by voting against the motion to ditch the Lords amendment but as many as 92 abstained, although some of these will have had permission to be absent. Those abstaining on principle included Marie Rimmer and Rachael Maskell.

China dominates the solar energy market and between 35% and 40% of polysilicon, the key raw material for solar panels, is produced in Xinjiang where the Muslim Uyghur population has been subject to arbitrary detention and forced labour.

Michael Shanks, the energy security minister, said the government would strengthen its efforts to tackle forced labour including by convening cross-Whitehall meetings involving the business department, Foreign Office and Home Office.

He announced that “a senior individual” in GB Energy would be appointed specifically to lead on ethical supply chains including modern slavery, and that the company’s strategic priorities would include working proactively to tackle it.

Government sources argued that the GB Energy bill was the wrong vehicle for this change because tackling modern energy required a cross-government effort across multiple sectors of the economy.

Shanks told the Commons on Tuesday this was a “question right across the economy, rather than dealing with this on a company-by-company basis”. He also argued that there are existing provisions in the Procurement Act that would allow GB Energy to reject bids and terminate contracts which are known to use forced labour.

Critics, including the former Conservative party leader Iain Duncan Smith, said that the Procurement Act only applies where a company has been convicted of modern slavery in the UK or faced equivalent action abroad, and that the Chinese government would not take action against Chinese companies.

A handful of Labour MPs called for stronger measures. Sarah Champion, the Labour MP for Rotherham, told the Commons that “the public deserves a guarantee that their money won’t be used to fund human rights abuses”.

Rimmer, the Labour MP for St Helens South and Whiston, said that “the Modern Slavery Act doesn’t work on this and the Procurement Act doesn’t work”, while Maskell, Labour MP for York Central, said ministers should “switch the burden of proof” so that companies are required to demonstrate they have no association with forced labour.

Helena Kennedy, the Labour peer who sponsored the amendment in the Lords, said: “I hope the government has a rethink on this issue. I am no hawk and believe we should keep up diplomatic exchanges on trade and climate change and ways of collaborating to end wars but we cannot continue to purchase solar panels which are the product of slave Labour.

“If China says this is not true let us come and visit the factories. Our whole history as a party is about protecting workers from exploitation. I am afraid I stand firm on this. Our moral position should guide us.”

David Alton, the cross-bench peer who drafted the amendment, said he would seek to have it re-inserted once the GB Energy bill returned to the Lords. “Both the last government and this one have been reluctant to move, despite the obvious moral imperative to avoid a slave-made green transition,” he said.

“Existing regulation isn’t working, and the Procurement Act could only bar companies if there had been a conviction either in the UK or China. It’s ludicrous to assume that Beijing is going to convict companies for participating in its own labour transfer schemes. This is a serious problem which needs primary or secondary legislation to address.”