1. INTRODUCTION
1.1 The New Zealand Initiative (the Initiative) welcomes the opportunity to submit on the Modern Slavery Bill.
1.2 The Initiative is a Wellington-based think tank supported primarily by major New Zealand businesses. In combination, our members employ more than 150,000 people. We undertake research that contributes to the development of sound public policies in New Zealand, and we advocate for a competitive, open and dynamic economy, as well as a free, prosperous, fair and cohesive society.
1.3 The views expressed in this submission are those of the author rather than the New Zealand Initiative’s members. We note that several of the recommendations we make below, including significant additional resourcing for the Labour Inspectorate, Immigration New Zealand and the New Zealand Police, would impose costs on, rather than provide relief to, our member firms. The submission’s recommendations track the McMillan Review of the comparable Australian Act, an independent statutory review.
1.4 Modern slavery is a grave violation of human dignity. The Initiative shares the concern of every party that supported this Bill at first reading that decisive action is required to address it. We endorse the international and domestic legal commitments that already prohibit slavery, servitude, forced and exploitative labour, trafficking in persons and related conduct. We support proper resourcing of the agencies that enforce those prohibitions. We agree with the proposition, expressed clearly in the Australian government’s 2023 statutory review of its own modern slavery legislation, that “all levels of society bear a collective responsibility to combat slavery”.1
1.5 The question before the Committee is not whether action is needed. It is whether the mechanism this Bill proposes will deliver it. On the evidence of the comparable jurisdictions that have run a similar experiment for between five and eleven years, and on the evidence of the recent academic literature reviewing their performance, the answer is that it will not. In Germany, the operating due-diligence regime has not yet produced documented reductions in the conditions it was designed to prevent. Germany pressed for the EU’s Corporate Sustainability Due Diligence Directive (CSDDD) to be adopted in a substantially narrower form than originally proposed and has moved to replace its own domestic Act, with the EU Council giving final approval to a substantially narrowed CSDDD in February 2026. That regulatory model has also been found wanting by government reviews in the United Kingdom and Australia. The Bill imposes substantial compliance costs, creates significant legal uncertainty, departs from established principles of corporate liability and rests on prevalence figures whose methodological foundations are contested.
1.6 We respect the work the joint sponsors of the Bill and the many advocates over many years have done to bring this issue to Parliament. Our disagreement is not with the cause. It is with the chosen instrument which, based on evidence, will not work.
1.7 Section 3 sets out the substantive case that modern slavery is a serious problem. Section 4 reviews the international evidence. Section 5 identifies eight design defects in the Bill. Section 6 offers an alternative approach grounded in proven New Zealand practice. Section 7 concludes. Annex A provides drafting amendments for the Committee’s use should it nonetheless decide to proceed with the Bill.
