2nd Reading Speech

3 May 2018

The Hon. ADAM SEARLE ( 10:52 ): I lead for the Labor Opposition on the Modern Slavery Bill 2018. With some reservations, Labor supports the bill. We support a strong, active and modern framework that combats efforts to enslave and exploit vulnerable persons wherever and however it occurs. In our view, this bill does not go nearly far enough in achieving those aims. However, it is a start, and we applaud the efforts of the bill’s sponsor, the Hon. Paul Green, and the other members of the Parliamentary Working Group on Modern Slavery who have worked to produce this bill: the Hon. Greg Donnelly, the Hon. Trevor Khan, the Hon. Matthew Mason-Cox and the Hon. Robert Brown. A number of other members participated, under the chairmanship of the Hon. Paul Green, in the parliamentary inquiry into human trafficking. That inquiry was also part of the underlying inspiration for the bill.

The bill starts the conversation on this vital topic and sets in train a process that begins to come to terms with the complex social and economic issues involved. Why do we need a modern slavery Act? According to the International Labour Organization [ILO], in 2012 there were 21 million people around the world trapped in some form of forced labour—the term used to describe all forms of modern slavery—including trafficking, debt bondage and child labour. These victims of exploitation work in private sector activities, such as manufacturing, construction, agriculture and even public sector supply chains. The United Nations says that modern slavery and trafficking is the second-largest criminal industry in the world, with the ILO putting annual profits from forced labour at $150 billion.

According to the Global Slavery Index 2016, it is estimated that there are 45.8 million people worldwide who are victims of some form of slavery. Australia has an important role to play in fighting modern slavery. Two‑thirds of people trapped in slavery worldwide are reported to be in the Asia-Pacific region, and it is estimated that an unbelievable 4,300 people are currently trapped in slavery here in Australia. According to Anti Slavery Australia, a law and public policy think tank that gave evidence to the human trafficking inquiry, Australian government departments in the several jurisdictions are buying products that may have been made using slave labour. The organisation said that there is “considerable potential” that government agencies in Australia are buying products and services with links to human trafficking or exploitation because ethical procurement guidelines are not up to scratch.

In a submission to the New South Wales parliamentary inquiry into human trafficking, Anti Slavery Australia said modern forms of slavery, including exploited labour, may be present in the supply chains of some departments. This is because there was a “complete absence of any real scrutiny” of supply chains at either a Commonwealth or State level. In New South Wales potential government suppliers are asked whether they conform to relevant legislation, including the worst forms of child labour. Agencies are also required to ensure procurement is “fair, ethical, transparent and incorporates probity”. However, there is no enforcement mechanism and, as far as I can tell, no consequences for failing to follow them. The new transparency in the supply chains provision in the United Kingdom Modern Slavery Act aims to rout out the slavery lurking in many supply chains. Importantly, the provision applies to both public sector and non-government supply chains. The provisions in this bill do not similarly apply.

In the past few years in the United Kingdom investigations into commodities tainted by slavery have included prawns from Thailand, debt bondage and forced labour in the global electronics industry and claims of the trafficking of migrant workers in the Scottish and Irish fishing industries. The new provisions make companies in the United Kingdom accountable for slavery and labour abuses occurring along their whole chain of operations. The idea is to ensure that no slavery is linked to any British product or service and to show consumers, investors and employees that companies are not passive and acting only after the fact but are taking a proactive stance. Any business or part of a business that has a global turnover of £36 million or more and supplies goods or services in the United Kingdom will have to produce and publish an annual slavery and trafficking statement in a “prominent” place on its website every year. The statement must set out what steps the organisation has taken to ensure there is no slavery in any part of its business, including its supply chains.

If a business fails to produce this statement, it could find itself at the sharp end of a High Court injunction requiring the organisation to comply or, potentially, an unlimited fine. Foreign companies and subsidiaries that “carry on a business” in the United Kingdom will also have to comply with the new legislation. Any overseas subsidiary of a United Kingdom company that produces goods and services sold or used in the United Kingdom is also caught in its net. It is too soon to see what impact the legislation in the United Kingdom will have but it certainly has cross-party support in that place and we wish it well. In 2010 California enacted a similar piece of legislation, the California Transparency in Supply Chains Act. The United Kingdom provisions are broadly modelled on that Act.

In the past year, a series of lawsuits have been launched by residents of California who claim that businesses that have since been linked to slave labour have deceived consumers through inadequate public disclosures. The most visible of these cases was one launched by a resident against Costco alleging that Costco violated the California Act by stating that it “has a supplier code of conduct which prohibits human rights abuses in our supply chain”, when evidence had emerged that farmed prawns sold by Costco were made with fishmeal obtained from boats using slave labour. Several other class actions have been launched against Nestlé, Mars and Hershey’s, demonstrating that consumers are increasingly willing to take corporate accountability into their own hands. Modern slavery legislation and similar legislation are currently in place in France and other parts of the European Union. It is well past time that Australia joined this international movement.

The Hon. Paul Green: Here, here!

The Hon. ADAM SEARLE: I acknowledge the interjection. At present, several voluntary international obligations relevant to modern slavery exist. Globally, more than 9,400 organisations from over 160 countries have committed as participants to the United Nations Global Compact [UNGC], the world’s largest corporate sustainability initiative, and are actively engaging in responsible human rights and labour practices. The Global Compact Network Australia brings together UNCG participants, other leading companies, not‑for‑profit organisations and universities to advance these same goals in Australia.

Between 2004 and 2016, the Australian Federal Police received almost 700 referrals relating to suspected human trafficking and slavery-related crimes, although only 17 people have been convicted of these offences so far. Most recently, in February 2017, two men pleaded guilty to charges of servitude relating to their treatment of Taiwanese workers in Brisbane. Recent media reports of exploitation of migrant workers in Western Australian farms and market gardens, Victorian farms, and in 7-Eleven retail stores nationwide, suggest this is a real but often hidden issue in Australia. Members will remember how 7-Eleven covered itself in glory over the wage theft scandal. However, longstanding criminal laws against trafficking and slavery have not prevented their occurrence and, for the most part, have not been relied on by authorities to prosecute exploitation. The effectiveness of pursuing employers for the exploitation of migrant workers through the Fair Work Ombudsman is also limited.

By extending the responsibility to tackle exploitation to include businesses and not just government, it is hoped that the introduction of modern slavery legislation will help tackle worker exploitation. I note that the Federal Parliament Joint Standing Committee on Foreign Affairs, Defence and Trade final report tabled on 7 December 2017, entitled “Hidden in Plain Sight”, makes 49 recommendations to combat modern slavery in Australia and around the world. The committee recommended that the Australian Government introduce a modern slavery Act similar to, but improving on, the United Kingdom Modern Slavery Act 2015. One of its recommendations was that labour hire contractors should be licensed to tackle the problem of coerced or debt-bonded workers living in slave‑like conditions. These licensing schemes should include random audits and unannounced inspections of labour hire firms to ensure compliance.

The Hon. Paul Green: Hear, hear!

The Hon. ADAM SEARLE: I acknowledge the interjection. I note that the New South Wales Labor Opposition has, as part of its plan to combat the scourge of wages theft in the State, already outlined a commitment to creating a system of licensing labour hire operations that will include detailed measures to ensure that they provide safe, fair and reasonable work conditions for all workers. Included in this plan are related measures and new laws to hold head franchisors accountable for the actions of franchisees, making them liable for what takes place in their franchise network regarding workplace safety, wages and other employment conditions. The report made other recommendations which I do not have the time to deal with, but even prior to that report, Federal Labor in opposition had expressed strong support for the introduction of new business reporting obligations and outlined a comprehensive modern slavery framework last year, proposing to go further than the United Kingdom.

In August last year, the Turnbull Government said that it would introduce a modern slavery Act as soon as possible but there is no sign of that despite bipartisan support and support in the business community. Last year the Labor Opposition also outlined its comprehensive plans in this important area. I will come to that in a moment. The bill before the House is said to address the findings and recommendations in the report on the Legislative Council committee inquiry into human trafficking in New South Wales, which was completed last year. As I indicated earlier, I commend that committee and its members, under the chairmanship of the author of this bill, the Hon. Paul Green. I suggest that members and the wider public read the committee report, which is very good. The Chairman’s foreword to the report states:

Governments themselves also need to investigate their own supply chains and slave-proof them. The New South Wales Government should introduce tougher requirements in its Code of Practice Procurement to ensure that its departments and other government bodies are ethically sourcing their supplies.

Members on this side of the House are in complete agreement with that. However, the bill does not achieve this. The major feature of this bill is that a slavery commissioner be appointed. Unfortunately, the role does not include investigating individual cases. It has public awareness and advice functions. The role will be to prepare a strategic plan to combat human trafficking and slavery-like practices in New South Wales. The commissioner is to work with statutory agencies that will have a statutory duty to cooperate and will have to report annually to Parliament. It specifically must report on government action concerning under-age and forced marriages. Commercial organisations and organisations with a turnover threshold of $50 million operating in New South Wales must also publish an annual modern slavery statement that deals with supply chains. That is in clause 22—the only part of the bill with any real teeth.

Sadly, government agencies including departments, State-owned corporations, statutory authorities, who are often the purchasers and suppliers of goods and services, are completely excluded from reporting obligations. That is an unfortunate oversight in the bill. A public register will identify organisations in which goods and services may be products of a supply chain involving slavery. That is a good provision. The bill establishes modern slavery risk orders that can prohibit people convicted of a modern slavery offence from taking certain actions. Miscellaneous components of the bill amend the Crimes Act and are said to deal with cybersex trafficking and child forced marriage—all worthy objectives.

As I indicated, the State Opposition adopted its own comprehensive modern anti-slavery policy last year that received favourable coverage. The key features of our approach are slavery-proofing New South Wales government supply lines, which would be achieved through a tough and comprehensive State procurement policy and strengthening guidelines by specifically including anti-slavery provisions as compliance measures. The aim is to ensure that no goods or services obtained by public money in this State are tainted by modern slavery. That must include making inquiries of tenderers as to ethical employment practices. The Labor Party already had policies that it took to the 2015 State election and intends to retain that commit a future Labor State government to only doing business with those companies and enterprises that have safe and fair work practices. We are committed to eliminating unfair work practices at every stage of the public procurement supply chain underpinned by the expenditure of public moneys in the State. That was a pre-existing commitment that we maintain.

Secondly, our vision was to establish a more powerful New South Wales Anti-Slavery Commissioner than the one to be created by this bill. The position would be able to collect and request data and inquire into the implementation of procurement guidelines. The commissioner would be able to advocate, monitor and assess trends and developments and the effectiveness of government policies and drive compliance. Our third feature is to conduct a public awareness campaign on human slavery in all its forms. There are several campaigns already focusing on legal rights for victims of human slavery in Australia usually by non-government organisations concerning forced marriage, but we think there is considerable scope to widen them.

We support the bill as a good foundation, but the functions of the commissioner in clause 9, the commissioner’s public awareness and advice functions in clause 12, the reciprocal duty on the commissioner and New South Wales agencies to work together in clause 14, and the other obligations in clause 15 together do not provide any real transparency over public sector procurement supply chains. That is an unfortunate oversight. The only real teeth in the legislation are to be found in part 3 clause 22 that deals with commercial organisations other than government ones and businesses with a turnover of more than $50 million. Given that when put all together the New South Wales public sector is the largest purchaser of goods and services in this country and the Southern Hemisphere, the exclusion from this bill of the things that New South Wales procures and pays for should be remedied in the near future. Members on this side of the House are committed to doing that.

The Hon. Matthew Mason-Cox: I think you need to read the bill more carefully.

The Hon. ADAM SEARLE: I have read it carefully; I look forward to the member’s contribution. That is something that needs to be remedied. Even so, it does not go far enough because there is no obligation on companies—

The Hon. Paul Green: We wouldn’t get it passed if we went further.

The Hon. ADAM SEARLE: Maybe not under this Government. I acknowledge that the author of the bill has tried to balance different interests such as those between the Government and the Opposition to ensure the passage of the legislation. It is not an easy thing to do. The obligations in clause 22 require companies to report, but there is no overriding obligation on them to eliminate exploitation and slavery from their supply chains.

It is a reporting mechanism only about what activities they have undertaken that move generally in that direction, but there is no obligation on them to take steps to achieve that objective. That is something to which we should return.

I will deal with three things said by Government members in their contributions. The Government reserves its right to move amendments in the other place, and the Parliamentary Secretary outlined some of its concerns, which is hugely disrespectful to the author of the bill and to members. The Government has the numbers in the other House and it can do anything it wants, irrespective of anyone else’s view. This is the House of review; this is the House with a more diverse political representation. If the Government is committed to the passage of this legislation and to parliamentary debate, it should put its amendments on the table so that all members can see exactly what its concerns are and to ensure that it abides by the outcomes of deliberations in this House. The Government is clearly signalling that in the other place it will gut the bill of any effective measures it has, and then try to stand this House up on a take it or leave it basis. If that is where the Government is coming from it should be honest about it and not proceed in this disrespectful way.

Secondly, this Government, true to form about its hostility to openness and transparency, does not want the Anti‑slavery Commissioner to be an independent statutory officer. The Government has identified this as a clear concern: it wants that role to be fulfilled by a public servant who will be subject to the direction of the Executive. That is a fundamental paradigm difference. Government, because of its own involvement in the supply chains, may have a conflict of interest. There may be things in government procurement that need to be identified and cleaned up and that is why we need an independent statutory officer to fulfil this function.

Thirdly, the Parliamentary Secretary expressed concerns about small business. The legislation only affects bodies with a turnover of more than $50 million. That is a medium to large business enterprise in anyone’s language—it is not small business. I think Government members are too smart to have made that mistake; I think this is a straw person designed to justify their gutting of this bill in another place. I hope I am wrong; the passage of time will tell. I urge all members to support the passage of this bill, albeit limited as it is.