In its recent response to the transparency in supply chains consultation, the Government has committed to extending Modern Slavery Act reporting obligations to large public sector organisations and will be making changes to current reporting requirements.
On 22 September 2020, the Government published its response to the transparency in supply chains consultation, which was undertaken in the summer of 2019. The consultation response paper sets out a list of measures that the Government has committed to implementing, with the aim of strengthening the transparency obligations governed by the Modern Slavery Act 2015.
In 2015, the UK became the first country in the world to require commercial organisations to report on their progress in relation to identifying and addressing modern slavery risks in both their operation and supply chains. Since then, in accordance with section 54 Modern Slavery Act 2015, businesses subject to the legislation are required to prepare a modern slavery statement setting out either (a) the steps being taken by that organisation to ensure slavery and human trafficking is not taking place in any of its supply chains or in any part of its own business, or (b) that no such steps have been taken.
These changes have led to thousands of businesses reporting on and developing their approach to modern slavery. However, as has been illustrated through the recent allegations of exploitation in Leicester’s garment industry, it is clear that much more can be done to try and eradicate this crime from both our local and global supply chains.
The consultation paper “Transparency in supply chains consultation” was published on 9 July 2019 and the consultation process ran until 17 September 2019. The consultation comprised of three sections, namely:
- Content of statements – this set out proposals to strengthen the impact of modern slavery reporting by mandating specific topics for organisations to report against;
- Transparency, compliance and enforcement – this section covered proposals to increase compliance and transparency; and
- Public sector supply chains – this section sought views on extending the transparency reporting requirements in the Modern Slavery Act to public bodies.
The Government received a total of 724 responses and held eight roundtable events across the UK.
Summary of commitments
Measures specific to public sector organisations
- Extend section 54 of the Modern Slavery Act 2015 to include public bodies with a budget threshold of £36 million or more.
- Allow public bodies to report as a group.
- Require public sector modern slavery statements to be signed off by the accounting officer, chief executive or equivalent role, and be approved by the senior management body.
- Publish guidance to help public bodies establish whether they would be captured by this requirement and to help public bodies decide when and how to report as a group.
Changes to the current system
- Mandate the areas that statements must cover.
- Publish new guidance, including best practice approaches to reporting against the required areas.
- Require organisations captured by transparency legislation to publish their statements on the Government-run reporting service.
- Require organisations captured by transparency legislation to meet a single reporting deadline – organisations will report on the same 12 month period (April to March) and will then have 6 months to prepare their statement by 30 September.
- Aim to amend existing requirements to improve clarity and enable scrutiny, specifically by
- Requiring modern slavery statements to state the date of Board approval and Director sign off; and
- Requiring group modern slavery statements to name entities.
- Consider enforcement options in line with the development of the Single Enforcement Body and issue a further update in due course.
For those already subject to the legislation, the main changes will concern the content of the statement (e.g. ensuring all mandated areas are covered) and submitting statements by a specific deadline.
For public sector organisations with the requisite budget threshold, it will mean new reporting obligations.
Many of the commitments set out above require legislative changes to be made. As the response paper notes, these changes will be made when parliamentary time allows which could mean a number of months from now. In the meantime, we can expect new guidance to be published on various different aspects of the proposed measures which will hopefully help prepare both commercial and public sector organisations for the changes due to be made.
If you’d like to know more, or you need our advice relating to any of these changes, please do not hesitate to contact us.
The full Government response to the transparency in supply chains consultation published on 22 September 2020
Bevan Brittan article: PPN 05/19 Tackling Modern Slavery in Government Supply Chains