Firms should be compelled to produce slavery reports, says review

An independent review has urged the government to ‘lead by example’ by extending reporting requirements of the Modern Slavery Act (MSA) to cover the public sector.

The final report examining the effectiveness of the MSA, said all government departments should publish a modern slavery statement at the end of each financial year, while local governments, agencies and other public authorities should publish a statement if its annual budget exceeds £36m.

The report said: “There was a general agreement among expert advisers and stakeholders consulted that government should lead by example and be covered by section 54. Some local authorities, NHS trusts and police forces are already publishing modern slavery statements. They are doing so on a voluntary basis as there is currently no requirement in the legislation for the public sector to report.”

Currently under section 54 of the Act, private sector firms whose turnover exceeds £36m must produce an annual statement on the actions taken to identify and avoid slavery in their operations.

The report also called for the government to strengthen its public procurement processes to make sure that non-compliant companies in scope of section 54 are not eligible for public contracts.

The review was carried out by politicians Frank Field (Independent), Maria Miller (Conservative) and the Baroness Butler-Sloss. It said a lack of enforcement and confusion around reporting obligations were responsible for a lack of compliance from an estimated third of eligible firms.

The report recommended the section of the Act which allows companies to report they have taken no steps to address modern slavery in their supply chains should be removed.

Instead the government should make “necessary legislative provisions to strengthen its approach to tackling non-compliance [with section 54 of the Act], adopting a gradual approach: initial warnings, fines (as a percentage of turnover), court summons and directors’ disqualification”, it said.

The report also recommended proposals to set up, or assign, an enforcement body should be brought foward by the government, to impose sanctions on firms that have not published a modern slavery statement.

“Fines levied for non-compliance could be used to fund the enforcement body,” it said.

Commenting on the report, Cath Hill, group director at the CIPS said: “The true cost of modern slavery is buried deep within global supply chains. The unfortunate truth is that slaves from around the world are involved in every part of our lives, making the clothes we wear and the food we eat. Ignorance is no longer an excuse.

“Businesses are left to police their own supply chains but too many of them do not know how best to tackle modern slavery and are seeking more guidance. The Modern Slavery Act has made great strides in raising awareness but businesses face no consequences if they fail to implement even the most basic checks to prevent modern day slavery.

“The review is absolutely right, the government must take an active role in compelling companies to act. Compliance must be monitored, business leaders held accountable and fines issued.”

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