40% of top government suppliers failing on slavery reports

26 March 2018

More than 40% of central government’s top 100 suppliers have failed to produce modern slavery statements that are legally compliant, a report has found.

The report said it was “highly concerning” so many first tier government suppliers were non-compliant and this was a “shocking wrong that must be righted immediately”.

It also found a wide variety of quality in the statements produced. Nearly half failed to reference due diligence processes and only 12 shared modern slavery KPIs, as recommended under Home Office guidelines.

The report comes as the latest official statistics show a record number of potential modern slavery victims were referred to authorities in 2017. The National Crime Agency (NCA) said the number of referrals increased by a third, from 3,804 in 2016 to 5,145 in 2017.

Eliminating modern slavery in public procurement, produced by Tussell, a public sector contract database, and Sancroft, a sustainability consultant, looked at the government’s top 100 suppliers by value, representing contracts worth £27.5bn.

Eliminate supply chain slavery logo

John Gummer, former secretary of state for the environment and chairman of Sancroft, said: “The dreadful and often hidden crime of modern slavery puts business in considerable risk of exposure to human rights violation. Overwhelmingly, our analysis suggests that government suppliers should be doing more to address modern slavery.

“Tackling this issue must be a top priority for all businesses – especially those receiving taxpayers’ money.”

He added collaboration was needed between civil society and the public and private sector, and that government needed to “encourage and incentivise” businesses to take action.

A government spokesperson said: “This government is committed to tackling modern slavery, which is why we introduced Europe’s first Modern Slavery Act and are spending £11m to tackle this barbaric crime.

“We are continuing to develop our approach in order to improve how businesses understand and address modern slavery risks, and to support departments in managing their procurement activity.”

Under Modern Slavery Act 2015, all companies that have a footprint in the UK and a turnover of more than £36m are required to publish an annual statement outlining the companies efforts to identify and eradicate modern slavery in its supply chain. To be legally compliant this statement needs to be signed off at board level or equivalent and be published clearly on the front page of the company’s website.

Of the government’s top 100 suppliers, 93 met the turnover threshold and all but three of these published statements. However 37 of these statements failed to meet minimum legal standard for compliance.

As well as measuring compliance, the report also measured the quality of the statements based on the Home Office’s six suggested reporting areas. These include:

  • Organisation’s structure
  • Policies in relation to modern slavery
  • Due diligence around the risk of supply chain slavery
  • Identifying high risk parts of the supply chain
  • The use of performance indicators
  • Training and capacity building

The report found measuring performance was the weakest area, with only 12 companies directly referencing KPIs to quantitatively measure progress. Identifying high risk areas within supply chains was another poorly performing measure: a third of statements failed to identify areas of high risk and the weakest of reports dismissed any existence of risk at all.

The NCA figures showed British nationals made up the largest national group for the first time, with 819 potential victims referred in 2017.

Will Kerr, NCA director, said the increase in referrals was driven by more awareness of trafficking and modern slavery. While this was to be welcomed, he said it was evidence that the official figures “almost certainly” underestimated the scale of the problem.

Kerr said there was an increasing crossover between modern slavery in the UK and organised immigration crime from abroad, and that there was a particularly concerning rise in the number of young people being exploited for sexual purposes or for drugs trafficking.

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