David Coleman (Banks, Liberal Party, Minister for Immigration) Share this | Hansard source

The government does not support the proposed amendments. The feedback from the extensive consultation process undertaken for the introduction of this important legislation was that reputational risk and reward will drive compliance far more effectively than any penalty regime. The proposed regime would be complex, would be resource intensive and would likely require a new regulatory enforcement body. The proposed penalties wouldn't address the most likely reason for noncompliance over the first three years of the bill, being a lack of understanding of the new regime.

What the government is doing is establishing a business engagement unit within the Department of Home Affairs resourced with some $3.6 million to advise on the new requirements under the modern slavery act and to support those businesses in fulfilling the requirements of the act. Importantly, the legislation provides for a three-year review, and at that time there will be an opportunity to review the evidence about reporting rates. It's also notable that this issue of penalties was considered by the Senate committee recently, who took a range of submissions from civil society and business. Importantly, after considering the evidence, the Senate committee supported the government's approach on penalties. Rather than immediate penalties, the Senate committee recommended, similar to the government's position, that this issue be assessed after the three-year period has elapsed.

The member for Hotham talked about noncompliance rates in the UK, but it is important to understand that the UK application has a very, very broad application to UK businesses and quite a low threshold, which has driven up the noncompliance rate. Importantly, the UK government did not actually establish a government body to provide support for the introduction of this new regime. That's precisely what we've done with the business engagement unit within the Department of Home Affairs. We think there's an important distinction to be made there. For those reasons, the government does not support the amendments as proposed by the member for Hotham.

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