On Tuesday 9th July, the UK Government published its response to the Final Report of the independent review of the Modern Slavery Act (MSA), while also announcing the launch of a public consultation on transparency in supply chains and the creation of a new10m Modern Slavery Policy and Evidence Centre. The Review was commissioned by government and made 80 recommendations as to how the statute could be reinforced to help address the issue of modern slavery, one of the biggest problems faced by society today.
Overall, it was encouraging to note the Government support for most of the 80 recommendations put forward in the Final Report, which is a clearsign of its desire to improve the effectiveness of the legislation. However, Government failure to move the sponsorship of the Independent Anti-Slavery Commissioneraway from the Home Office or fully endorse recommendations on corporate sanctions for non-compliance are missed opportunities for improvement.
On the role of the Independent Anti-Slavery Commissioner
It is encouraging to note the creation of a Modern Slavery and Migration envoy to represent theUK interests on modern slavery and migration in key international fora and with key partner countries. The IEMA member survey carried out during the Review process revealed the desire for the commissioner to focus more on national engagement issues. Desire to engage with the UK on these problems at the international level will be reliant on the priorities of each Nation-State, a role which a ModernSlavery and Migration envoy may be better suited for, subject to regular communication links between the Envoy and the Commissioner office.
Despite the creation of a new Memorandum of Understanding between the Commissioner office and the Home Office, the Government rejected the recommendation that the commissioners should not be sponsored by the Home Secretary to ensure its independence. As set out in IEMA initial recommendations, the independence ofDame Sara Thornton in her role as Commissioner can only be maintained if it isring-fenced and set by parliament, enabling her to better hold the government to account.
On Transparency in Supply Chains:
During our member survey, 84% of participants called for the publication of a list of all those businesses caught by the MSA. IEMA, therefore, commends the government for accepting the Review recommendation on this point and for identifying approximately17,000 UK organisations, which are likely to fall in the scope of the legislation.
With69% of IEMA survey participants believing that a central repository should be created, IEMA also welcomes the government decision to set up such a repository to which companies are required to upload their statements and which should be easily accessible to the public, free of charge. This endorsement will permit greater public scrutiny while highlighting the efforts of responsible companies to map their supply chains, examine corporate systems and structures and conduct due diligence.
The extent of engagement around modern slavery within the public sector has to date been limited to an amendment to the Public Contracts Regulations 2015 in the field of public procurement. With 90% of our survey participants recommending that section 54 should be extended to the public sector, it is greatly encouraging to note that government has finally accepted this recommendation and extended the clause to public procurement. We hope this will ensure that organisations wishing to win public contracts will comply with their obligations and look at their supply chain. We have responded to the Government consultation on integrating social value in government procurement and look forward to furthering opportunities to support its efforts in this area.
Finally, and most importantly, the Review recommended that the Government should amend the Companies Act 2006 and section 54 of the Modern Slavery Act 2015 to include a requirement for companies to refer to their modern slavery statement in their annual reports. It also went further to create an offence under the CompanyDirectors Disqualification Act 1986 for companies in scope which fail to fulfil modern slavery reporting requirements or to act when instances of modern slavery are found. Despite 90% of IEMA members stressing that sanctions should be applied, and this being signalled as an important recommendation of the review, both recommendations on sanctions for non-compliance were not formally endorsed by government on the grounds that this might lead to an overly compliant driven approach. The government will, however, be consulting on this issue in the public consultation on transparency in supply chains.
This important point is an opportunity for the government to set out a process for applying such sanctions. IEMA will, therefore, engage with members to structure its response to the consultation and continue to work with the Government to ensure we can provide teeth to the legislation and help to combat the issue of modern slavery which is causing an estimated 40 million victims worldwide.
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Posted on 17th July 2019
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