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Legal and Constitutional Affairs Legislation Committee

CATT, The Very Reverend Dr Peter, Member, Public Affairs Commission, Anglican Church of Australia

CONDON, Commissioner James, Chairman, Australian Freedom Network

FLOYD, Mr Rob, Associate General Secretary, National Assembly, Uniting Church in Australia

ZIRNSAK, Dr Mark, Senior Social Justice Advocate, Synod of Victoria and Tasmania, Uniting Church in Australia

CHAIR: I call the Legal and Constitutional Affairs Legislation Committee back to order in its inquiry into the Modern Slavery Bill 20218. I welcome representatives from the Australian Freedom Network, the Synod of Victoria and Tasmania of the Uniting Church in Australia, and the Public Affairs Commission of the Anglican Church of Australia. Thank you very much, gentlemen, for your submissions and for your presence here today. These proceedings are being recorded by Hansard. I think we've provided to all of you some information on parliamentary privilege and the protection of witnesses, a formality which I hope is irrelevant to these hearings but that we're nevertheless required to do. I ask each of you to make a short opening address in relation to your submission or anything else that you wish to say.

Mr Condon : The Australian Freedom Network was launched at Parliament House in Canberra on 2 December 2015. It followed the launching of The Global Freedom Network, and Australia was the first country to establish its own freedom network, bringing together leaders of all the major faiths in Australia—something that was not easily achievable, but we did achieve it and we continue to lead the way as far as that is concerned. I'm proud to have been chairman of the network since December 2015.

We're delighted at the progress that has been made, with legislation now introduced into the parliament, and we'd like to acknowledge the significant work done by so many to get us to this present day. It's been an amazing effort. On behalf of the network, I would like to commend the government for its leadership in developing the Modern Slavery Bill. I also acknowledge the Labor Party, for its support of the legislation, and all interested parties—senators, members, committees et cetera—for all that has been done. Yes, we could see ways that the legislation could be improved, but in general we are very supportive of the bill in its current form and would like to see it passed as soon as possible so this becomes a reality—a reality that acknowledges the years of work which have preceded the culmination of this legislation, which we believe is urgently needed to address the issues we are facing in Australia at this time.

On behalf of the network, I'd like to highlight three areas of improvement, which are in our submission. Firstly, the Freedom Network asserts that statutory oversight and coordination of Australia's full response to modern slavery is vital to a substantive act. And surely that's what we want—a substantive act. Secondly, we support establishing a long-term commitment to rid Australian supply chains of slavery by extending the three-year review to a rolling three-year review and by introducing some specific terms for the review so we are working from a common frame of reference of what defines its success. Finally, in terms of what I'd like to say today, we support creating an additional incentive to report by requiring companies wishing to tender for government contracts to be compliant with the modern slavery act.

CHAIR: Thanks very much. Reverend Catt?

Rev. Dr Catt : The Public Affairs Commission of the Anglican Church is chaired by Dr Carolyn Tan of Perth.

Senator PRATT: She's a very talented Western Australian.

Rev. Dr Catt : She certainly is a very talented Western Australian. We also thank the government and the Labor Party for supporting this bill and for bringing it forward. We also support the majority of the bill. In our submission, we have requested that there be some penalties applied to people who fail to report, and we've asked for the threshold to be reduced to the threshold that already exists for a large company—make it $25 million instead of $100 million—to have consistency with a large business. I think that will be enough for me for now.

CHAIR: Thanks very much. Mr Floyd?

Mr Floyd : The Assembly of the Uniting Church in Australia is the national office of the church, and I'm speaking along with my colleague, Dr Zirnsak, in support of the submission of the Synod of Victoria and Tasmania from a national church perspective.

The Assembly of the Uniting Church is responsible for setting church policy and promoting the church's mission across the world. In this regard, we have relationships with many churches across Asia, the Pacific and Africa, and, through conversations with partners, we know this is an area of concern for them and for the most vulnerable people in their communities. The Uniting Church has advocated for laws that will see Australia as a global leader in fighting human trafficking and slavery. As a church, nationally, and with our extensive network of social services, we will be a reporting entity, and parts of our church are having conversations about this already.

I speak in support of the bill in its current form. I note there are elements of this bill that are not fully in accord with the original submissions we've made, and my colleague will elaborate on these. As one example, we have spoken in favour of an independent commissioner. However, we believe that this legislation represents a valuable step forward in this area of vital importance. Thank you.

Dr Zirnsak : For us, this bill is partly on the path of eight years of campaigning that we've been undertaking in this space. This bill is a substantive improvement on the UK Modern Slavery Act, with regard to the transparency reporting mechanism, in part because it actually establishes a modern slavery engagement unit. So you actually have some people who are going to have the ability to potentially follow up with reporting entities, make them aware they have a reporting obligation and help them refine that reporting. From our perspective, the worst possible outcome here, given the momentum that now exists towards doing the reporting, would be that we have a bill that gets amended in the Senate but then can't pass the House of Representatives and gets stuck in permanent stalemate. We will lose all that momentum. There are plenty of people building up towards helping the reporting mechanism.

We've tried to look at the bill as part of an overall patchwork and system. Primarily, we see the bill fitting in by dealing with international supply chains. There are much better things that could be done to address modern slavery in domestic supply chains, and we have been part of the Supply Chains Working Group under the Attorney-General's Department National Roundtable on Human Trafficking and Slavery. Subsequently, we are in the process of being about to submit a report collectively from the labour trafficking working group to the minister that has a number of recommendations from community groups to deal with modern slavery in domestic situations. The difference between the two is that, when it comes to domestic investigations, we'll get access to workers; we will quickly be able to figure out who is in their supply chain. When we have a factory or a processing facility overseas and our investigations establish that there's slavery or human trafficking, establishing who the Australian customers are can be very difficult, largely because we don't have transparent customs data. And I'm happy to elaborate on that.

Clearly the committee has heard from lots of people who would like to add many other things to this bill. Most of those are things we would support. But again, we don't want to see this bill lost because of those. We also do feel there are things that could improve the bill, even just on that transparency measure. But again, even without those things being added, this bill is worth passing, even in its current form. It would be better if some of those things could be added, but the bill as it stands is worth passing.

The only thing we strongly oppose is a lowering of the threshold in the current regime, because we're looking at the system. We're looking at: how do you effectively engage with 3,000 entities already? Currently the government has committed five public servants to do that. That's 600 entities per staff member already. Having previously worked on the Illegal Logging Prohibition Act and the regulations that go with that, we know the effort the Department of Agriculture and Water Resources had to go to—they have 20,000 reporting entities under that act—just to make entities aware they have an obligation, and then to educate them about what it means to have to fulfil that obligation. In this case, you're also going to have to read the reports when they come in. That's 3,000 reports that have to be gone through before they're put on the register. There are a whole lot of tasks. We need to think about this as a system, not just as a piece of legislation. It's very easy to say, 'Let's just expand it to 15,000 or 20,000 entities'—and I'm completely comfortable with that, if the government then announces we're going to have a new regulatory body with 150 staff. Great! Fantastic! I'll fully support that. But if we're talking five staff—lowering the threshold at this point in time is not something that will make this bill more effective; it will make it less effective. Thank you.

CHAIR: Thank you, Dr Zirnsak. You've been living around parliament or Canberra, have you?

Senator PRATT: I think he has, recently; he's been very active on this issue!

CHAIR: Your understanding of how things work is commendable! Senator Pratt, would you like to start, as deputy chair?

Senator PRATT: Yes, I certainly do have some questions. I will begin where we've stepped off in this debate, around the progress of this legislation through the parliament. I understand that the synods of Victoria and Tasmania in the Uniting Church in Australia are no longer pushing for penalties. But you are only not pushing because you believe that puts the passage of the bill through the parliament at risk—is that right?

Dr Zirnsak : We would still support penalties in the bill. Our argument is, though: if the bill were amended to include penalties and that meant that the bill wouldn't make it through the parliament, that, to our mind, would be a very undesirable outcome—having a bill that the Senate has amended to have penalties that the House of Representatives then won't pass. Also we have stressed that penalties give you a compliance boost, generally; they do not guarantee absolute compliance. Take the Corporations Act—

Senator PRATT: No, no; I can see that.

Dr Zirnsak : Okay. I can give plenty of examples where government has laws that have penalties that do not ensure compliance. So it's about the system. And it's about figuring out: if you have penalties in this—and we support penalties—what penalties would give you the greatest level of compliance? What would give you the biggest compliance bump for the resources you're willing to provide? For example, even if you were to do penalties, you'd be better off doing infringement notices, for example, rather than the entity having to take people to court to allocate a civil penalty. We encounter plenty of regulators who won't enforce civil penalties, simply because of the resources that it consumes to have to go to court to actually get that civil penalty remedy enforced on the entity.

Senator PRATT: So let's be clear. You would prefer the government does include—

Dr Zirnsak : A penalty regime—

Senator PRATT: Yes.

Dr Zirnsak : But that could be—people today have raised lots of inventive and creative ideas that I think are worth exploring. There was the idea that you mightn't be able to get government contracts. One of the ideas we put forward was that, instead of just a blanket penalty—so you wouldn't get a silly outcome where a large supermarket chain would say, 'We're not going to bother reporting'—the modern slavery business engagement unit might be able to issue a notice saying: 'You need to report,' and the entity would then have the ability to say: 'Here's the proof that we don't meet the threshold. We won't report.' But if they wilfully ignored the notice and they were clearly caught, then the penalty would apply. So it's getting away from the silly idea that people who really are definitely caught don't just thumb their noses at the law, and there is an ability to potentially get them to report when they should be doing so.

Senator PRATT: Surely we should, at the very least, be naming entities publicly that haven't reported?

Dr Zirnsak : That would be ideal and we strongly support the idea there should be a public list. We have made recommendations there. I think the problem the bill introduces—and some people have presented evidence on this before—is that $100 million in the way the bill defines it is $100 million worth of total revenue. It's all the global operations, not just Australian operations. Even the RTA definition, which we provide on page 8 of our submission—that transparency list—relates to the Australian revenue. The ATO can pull that from tax returns. I'm not convinced they have the global revenue number straightaway from the tax returns, because you'd need to look at the consolidated bodies. That's a really complex task for businesses. Doing it for charities, as we point out, is really easy. The ACNC data is extensive. It's an Excel spreadsheet; you can instantly know. Whatever threshold you set, you can catch charities. It's businesses that are the problem, because they file their accounts as PDFs. Further entities that probably should be filing accounts sometimes don't. Occasionally they get prosecuted for not doing so. So there are some real challenges on the business side in getting that list together. That's why we've said if you want a public list the easiest and simplest way to go would be just to align the reporting requirement for companies to be the same as the Taxation Administration Act section 3C, which we give in page 8 of our report. You have the 2,040 entities there straight off.

Senator PRATT: Do you suspect the government have chosen a different methodology than that so that they don't have a definitive list of who's required to report?

Dr Zirnsak : In talking to the people who designed this, I couldn't get a sense of why they chose that. It kind of felt like they were responding to pressure from a lot of community groups who were arguing they wanted the net to be as wide as possible. But the consequence of making the net wider and not aligning it to an existing definition—

Senator PRATT: You can't name them.

Dr Zirnsak : It creates a lot of work. And the other part you need to then think about is: if you're going to allocate more public servants to develop the list, is that really what we want more public servants to do? If we want to give more public servants to the modern slavery business engagement unit, I'd probably suggest it would be better if those people were out talking to businesses about how they improve their systems and how they do things better. So, there is opportunity cost. If you've got people wasting their time—well, not wasting their time, but spending all their time—putting together a list when they could be actually engaging with entities about their systems and about addressing risk, they are the trade-offs we're making.

Senator MOLAN: With the tax admin area, could you give me—

Dr Zirnsak : It is on page 8 of our submission. It's the Taxation Administration Act 1953 section 3C, and that's the transparency measure. It basically covers all entities that have $100 million worth of Australian revenue, except for private companies that have 50 per cent Australian ownership. The reasoning for that at the time was the argument that a private Australian company revealing their data could actually be telling you about the financial affairs of the family who owned the entity. That was the debate that was taking place. Frankly, I don't agree with that argument, but that was the argument that won the day and that is why there's this different threshold between foreign private companies and publicly-listed companies and private majority-Australian-owned companies.

Senator PRATT: Can all of you comment on your position in relation to the appointment of an independent anti-slavery commissioner or advocate. How do you view the current issues in terms of just having a business engagement unit? What will we be missing if we don't create a commissioner role?

Mr Condon : Would you like a commissioner to start answering that?

Senator PRATT: You can start, Commissioner!

Mr Condon : Our first point was that we assert that statutory oversight and coordination of Australia's full response to modern slavery is vital through a substantive act. There may be resistance, as I understand it, to naming a person as a 'commissioner'—there is a bit of history there—but I'm sure there are other names that could be well-chosen to define the role. Some of the key points of that role would be oversight, engagement education and support. Those are the sorts of things that, however the person is titled, they would be involved in doing.

Very Rev. Dr Catt : I support that.

Dr Zirnsak : I think other people raised, rightly, that it could be this role of advising businesses about how to manage their risks. Another area would be oversight of the national action plan to deal with slavery and human trafficking—to have someone actually looking after that. A third space would be helping to coordinate between the law enforcement agencies, similarly to what the government did with the transnational organised crime coordinator that's recently been appointed. When I hear arguments against having an antislavery commissioner, I think: if you mount those arguments, why did you have a transnational organised crime coordinator?

Senator PRATT: Or an eSafety Commissioner.

Dr Zirnsak : Yes. So there are examples. Why would we see a difference here? I think the other thing would be—using the military example—having someone playing what's called a red team role—basically, someone who can look at the systems from outside and say, 'How well are our antislavery, anti-human-trafficking systems really working?' They would be able to give that input and feedback in a way that's separate from the current law enforcement agencies. This concept of red teams is something law enforcement are using a lot more of, and the military has used it for quite a while. Business use it, and not-for-profits are using it a bit as well.

Senator PRATT: Can any of you point to any areas in terms of labour standards locally where there are slavery-like conditions and where our current regulation through immigration or employment standards or other mechanisms is failing in the slavery context?

Dr Zirnsak : What you tend to have is a spectrum between labour exploitation and what might be termed modern slavery. The difficulty law enforcement often faces is that, to make a slavery or human trafficking offence stick, you need a victim who's going to be usable in the prosecution. What we fear will happen is that, when some of these cases emerge, that's going to be too hard, so it will get kicked up to the Fair Work Commission or the Fair Work Ombudsman to do it as a civil penalty as a breach of the Fair Work Act. So some of the cases will be hidden there. If you ask what kind of industries we would see that in, they include food processing, horticultural and farms. You've seen it in the construction industry. People talk about nail salons and those kinds of things. There's a blurring between when it crosses the line and meets the threshold of a criminal offense and when it is just exploitation under the Fair Work Act. There would be a little bit of a debate around that. They're well established. The Australian Institute of Criminology have done reports on that. There have been previous parliamentary reports about the kinds of industries. Our argument has been that some of our immigration conditions that we set on visas facilitate that. The Fair Work Ombudsman has taken a similar view. If you look at, for example, the working holiday visas, they've been quite critical of the fact that you have to be 88 days out on the farm to get your second visa. They've indicated that that tends to allow people on those—

Senator PRATT: Exploitation.

Dr Zirnsak : Yes. So you go there, you've been there 66 days, and the farmer turns around and says, 'Right, you're going to pay me or you're going to have to give me sexual favours in order to get your visa renewed.'

Senator PRATT: Yes. So anywhere people want to legitimately access a labour market but someone has some kind of leverage over them in order to maintain access to that market, be they people who legitimately want to work in sex work but end up being trafficked because someone else has control over their employment or fruit picking or anything else. Is that what you mean?

Dr Zirnsak : Yes. So there's a power imbalance. The other thing I'd probably comment on in this sector is that the exploitation pool is so large. The law enforcement resources don't match up to it. I think law enforcement increasingly are seeing that you're generally better off looking at mechanisms that act as deterrents. So you're trying to do the deterrence and disruption mechanisms that have a mass scale so that you reduce the pool of criminal activity and exploitation taking place, so the amount you have to do investigation and prosecution for is smaller, and then you get the general deterrence effect. The criminology basically says that general deterrence works on the basis of not just the severity of the penalty but also, far more importantly once the penalty is adequate, whether I will be detected and prosecuted if I'm caught. So, with a tough penalty for something where lots of people are doing it and you're only prosecuting a handful of cases, the general deterrence tends to not be as effective. If you can treat the pool, then the general deterrence becomes more effective.

Senator PRATT: Yes. Sometimes you can also make those that have been exploited more hidden and more vulnerable because—

Dr Zirnsak : Because there's such a large pool.

Senator PRATT: And, frankly, in order to access the labour market that they might want to access, they then end up in these exploitative situations, because they need to co-conspire with their enslavers, essentially, to remain silent in relation to the work.

Dr Zirnsak : That's a good way of expressing it—'co-conspire'.

Senator PRATT: Do any others of you have any observations around those issues?

Commissioner Condon : I was going to mention seasonal workers. I talk about this now from the Salvation Army, not the Freedom Network. We've had some examples of where we've been involved with the tomato pickers in Bundaberg and Lockyer Valley in Queensland and with the seasonal vegetable workers down in Griffith in New South Wales. From our experience, there've been illustrations there.

Senator PRATT: Can you flesh out those examples for us a little more? Is it examples of people having their ongoing visas threatened so they're in more exploitative conditions? Are they people who've been brought in from overseas, having been promised legitimate work but who then found it's not available and therefore they're threatened with deportation?

Commissioner Condon : All of that, yes. I think Mark illustrated it very well with what he said. In case of the tomato pickers at Bundaberg they were living in a bus and they weren't being paid anything when they were found. That leads me to comment, if I may, about penalties. I hear what's being said about penalties, but, in my third point of the submission from the Australian Freedom Network, I said that we support the creation of an additional incentive to report by, requiring companies wishing to tender for government contracts to be compliant with the modern slavery act. This is probably not the time nor the place to explore this, but how do we define 'penalties' as opposed to 'incentives'? Looking at all of society, penalties haven't always worked, but incentives usually do. It's just instigating how best to do that to get people to comply. I heard an earlier speaker from the Australian Retailers Association speak of reputation risk and name and shame. As a consumer, if I read something negative about a supplier of my groceries, or whatever, I will walk away from it, whatever it might be.

Senator PRATT: Clearly there should be penalties for the labour company or the tomato grower that was responsible for those exploitative slavery conditions, but we've then got to work out what the penalty or otherwise is for the canning company that was actually using those tomatoes and didn't look into their supply chain, for example. Is that kind of what you mean?

Commissioner Condon : Yes. And there are penalties, but it also leads into the modern slavery act and penalties. Penalties are there—call them penalties, laws or whatever—in so many areas, but they're never enforced. So where do we go with that? They're not enforced for all sorts of reasons, such as inadequate resources out there, whether it be police or whoever, to enforce the requirements.

Senator PRATT: The Public Affairs Commission of the Anglican Church has argued for a lowering of the revenue threshold to broaden the number of companies covered by the requirements. Clearly that's been debated widely, and I know there are differing opinions on the panel in relation to that. Are you able to comment on that? Clearly you are looking for greater buy-in from more companies to participate. What are your views about how workable that will be?

Very Rev. Dr Catt : I guess that then comes down to the commitment that the government actually has to eliminate slavery. If, as Mark pointed out, it's under resourced, his point is quite valid, but if the idea is to eliminate slavery then the resourcing should follow. The net needs to be cast as wide as possible so that you have the best chance of creating cultural change.

Senator PRATT: Yes. I can see what you're pointing at. Clearly the capacity to drive cultural change will increase if more companies are participating.

Very Rev. Dr Catt : Yes, if it was all part of a package where you have a commissioner who's advocating for the change in culture and ensuring education is taking place so that it's not just a bureaucratic response; we're committing ourselves as a nation to the reduction and abolition of slavery. It's going to require resources. That's not only eliminating slavery in terms of the human need but it's also protecting markets and businesses. If you have Uzbekistan, for instance, corrupting the world cotton market, that puts our cotton growers at greater risk. There's a lot of economic benefit to be received as well with de-corrupting some of the world markets. It's actually worth the government investing to add that level of protection.

Senator MOLAN: I just have one question in reference to the 88 days, Dr Zirnsak. Can you suggest any other way around this? When this was brought in, it was a very important way of trying to manage what we were doing—getting people out to the farms, giving South Pacific workers opportunities. I hadn't realised that this is something that'd going to be exploited and will be exploited. Do you have any clever suggestions?

Dr Zirnsak : It's working holiday visas. One way of looking at a possible fix is that it's not the employer who signs off on the 88 days worth of work but that you have an independent person doing it. It might be a justice of the peace who has to sign off as a check so that the worker has an ability to say, 'This guy has been ripping me off blind for the time I've worked the 88 days' or whatever the case may be. That could be one possible protection.

What we have been suggesting is a massive expansion of the seasonal worker program. We actually think that program has a lot of benefits. There have been issues on that program as well, but the Department of Jobs and Small Business has been doing a much better job of addressing those issues. We've had a really good case recently that I won't talk about publicly where we had engagement with them. There had been a problem with them back in 2016. They followed up with the workers, and we got a fantastic resolution on that, which was really great for the workers involved in that. We are currently seeing Agri Labour being taken to Federal Court over a case in Victoria as well. We're seeing improvements there.

People in the Pacific definitely need the jobs. We get a lot of mixed feedback, but generally the feedback that we hear is that Pacific workers work pretty hard. There are big benefits to that. That would be our preference about the growth of where farm labour might come from. There might be other tweaks that could be done. It's always just looking at the power balance. How do you get the balance right between a worker not coming in and ripping off the employer and doing what they should be doing versus the employer also not being given so much power that they can exploit and mistreat the people who are working for them?

CHAIR: Commissioner, do you have a thought about encouragement versus penalty? Can you think of forms of encouragement that would act better than a penalty might?

Mr Floyd : Is not avoiding a penalty an incentive?

Mr Condon : Reporting is my first response because companies like good kudos in terms of ticks against their name or whatever by complying and being able to report that as part of their social justice arm of what they're doing—reporting and being able to say: 'We comply and we're committed to this. It's part of our social justice.' The generations of today are very committed to social justice, and people want to hear about that. That is my response off the top of my head.

CHAIR: Thanks for that. Doctor, thank you for pointing out the definition under the Taxation Administration Act. I must say that once upon a time I used to be a lawyer, but I'm just trying to read this quickly and I can't follow it.

Senator PRATT: It is a long time since you've been a lawyer, Senator Macdonald.

CHAIR: Yes, it certainly is.

Dr Zirnsak : The advantage you've got there, though, is that you can just go to the ATO's website and download the list as an Excel file.

CHAIR: But what companies does it include? It's strangely written.

Dr Zirnsak : Any company with $100 million worth of Australian revenue, except if the company is a private company that has 50 per cent Australian ownership. Then the threshold is $200 million. So all the companies on that current list will be. Effectively, that already provides a public subset list of the reporting entities under the bill as it's drafted. So I'll be able to go to that list and see that there are 2,040 companies. That will keep us going for a long time in engaging, before I have to worry about the ones outside of that that are caught under the current bill.

Senator PRATT: We can name a lot of them that haven't reported just based on comparing the lists.

Dr Zirnsak : I can just go by that list. We'll be able to look at that list and say, 'Of those 2,043, who's reported and who hasn't?' That list is absolutely rock solid.

CHAIR: But a foreign company that has a total income of $120 million, $20 million which is Australian and $100 million of which is foreign—

Dr Zirnsak : It won't be caught. Correct.

CHAIR: Under the current legislation, they would be caught?

Dr Zirnsak : Yes, correct. They'll be caught.

CHAIR: But under this they wouldn't be?

Dr Zirnsak : Correct.

CHAIR: So there would be a lesser number of companies overall.

Dr Zirnsak : Correct, but we would have certainty about it. Part of what this builds is a picture of how well sectors in this business area are actually addressing the risks of modern slavery. This in itself will not solve modern slavery, as you point out.


Dr Zirnsak : What it gives us is an indication of how seriously a business is taking it. The bill will also drive behavioural change from businesses to take it more seriously. But ultimately we work with businesses on the ground. We give you that example at the back out of India, where this company had an audit done at the factory yet, our when researchers have gone and talked to workers, there were still issues that were undetected by the auditor. So addressing some of these issues is going to require more extensive work. The legislation is certainly a good step forward. Having a public list allows us to then do a much better analysis of how many are actually taking this seriously so that we know more adequately. That would be the argument. It is also just about the pool of who these public servants in the business engagement unit will have to go and talk to. Giving them time to go and engage with people and get their systems right is really important.

Just quickly, there is one other point I want to make. You had a previous witness talk about what happens if you find risks of modern slavery. We're going to be a reporting entity. If the committee is going to make any recommendations in that space and we're thinking about it, I would also urge you to think about materiality, because it's something we turn our mind to. In other words, let's say that, as a church, our agencies are buying $1,000 worth of goods and we find there's a slavery risk. It would be unreasonable to us or any business to suggest we have to spend $20,000 mitigating a risk for $1,000 worth of purchase. So there has to be materiality, because ultimately the behaviour should drive change back at the supplier end. What you want is people who aren't being harmed and have decent jobs and decent conditions. That leverage increases the more the buyer actually has leverage within the market. Other witnesses talked about that. So that becomes an important factor. You don't want people having to chase the $100 purchase they made and having to spend disproportionate amounts of money mitigating that risk.


Dr Zirnsak : A tea importer should seriously have to consider whether there are slavery risks in its tea sourcing. If a business or a not-for-profit is buying teabags for its tearoom in its office, and that's the only tea purchase it makes, surely that shouldn't be something that it spends a lot of money thinking about or trying to mitigate.

CHAIR: Dr Catt, did I detect that you want to add to a previous answer or that one?

Very Rev. Dr Catt : No, thank you.

CHAIR: Okay. Dr Zirnsak, if it were reduced to $50 million in Australian income, you'd catch a greater number of companies, but that's not a list that's currently kept. That would have to be a new list, wouldn't it?

Dr Zirnsak : Correct. My understanding is that, to produce that list, the ATO had to do substantial work. We've spoken to the Australian Accounting Standards Board. They indicate generating these lists is quite difficult. They're not impossible to do, but the point is: how much public servant time do you want to use on that versus anything else? It's not even just on the reporting requirement; we need to think about: if you're going to deploy another 50 public servants, are we better to have them in law enforcement, actually going out and catching people engaged in serious labour exploitation, or are we better having them in services to support people who are victims of human trafficking? We need to think through: where is the best deployment of more public servants? Is it on making this transparency mechanism work, or is it on other aspects of human trafficking and slavery? Where are the greatest needs and where are the greatest benefits in deploying more public service resources and government revenue effectively into that? That exercises our minds as well. We think this measure needs to happen. We're happy to see the resourcing increase, but we're conscious that there are other needs in this field as well—about supporting people who've been victims of trafficking, about prosecution, about investigation—where it could also be worthwhile having more resources.

CHAIR: I think the three-year review period will allow a lot of this to be sorted out. We'll be able to work out in three years what has worked, what hasn't worked and what needs to be upgraded or downgraded. There has been some discussion—I think from some of you, but perhaps from other witnesses—about domestic slavery. Would you agree that they are really issues more for the Federal Police than for a reporting regime that's being envisaged by this act?

Dr Zirnsak : The government has had a labour-trafficking working group, which we've been part of. That's under the National Roundtable on Human Trafficking and Slavery. That has been made up of civil society organisations and all the law enforcement agencies, looking at this very issue of domestic human trafficking and domestic forced labour situations. As I flagged earlier, I think there is a role for prosecution. Investigation and prosecution is one mechanism—greater support for victims when they're detected, greater ability and encouragement for people to blow the whistle. But there are also things that need to happen to deter the exploitation from taking place. As I indicated, some of that might be rebalancing around how visa systems work so that you reduce the opportunity for exploitation. We did research—for example, looking at things like giving amnesty to workers out on, let's say, farms. Currently, the estimate is that there's probably about 60,000 workers working illegally out on farms. The majority of those are probably in exploitation situations. Where countries have tried amnesties, this certainly benefits the workers who are being exploited. You give them an amnesty; you give them a regular visa. They're then entitled to work anywhere. What we've tended to see in other places is they then leave the farming sector and they go and work in some other part of the economy, and the farmer who was willing to tolerate the illegal exploitative conditions simply goes and recruits a whole new batch of people to come in and repeat the process all over again. So an amnesty can work, but it has to be a combination with taking away the incentive for a farmer or a labour hire provider to keep engaging in the illegal activity. Some of that can be investigation and prosecution, but when it's broadly system-wide you need to look at: what are the other levers you can pull that disrupt that or take away the incentive or eliminate the ability to make a profit off that? And that's why I was saying I can't speak to the recommendations of that labour trafficking working group, but there were over 20 recommendations made to try to address all those different aspects of the system. There's also the Migrant Workers' Taskforce, which Allan Fels and David Cousins are heading up, which is also making recommendations in this space. I think you're right, though, to talk about a transparency mechanism for the domestic level. It has some value, but of a very low level in comparison to many of the other levers you can pull to address those problems.

CHAIR: We thank you all very much for your written submissions and for the efforts you've obviously put into this over a long period of time. I guess you're all pleased to see it coming to some sort of fruition, if not absolutely 100 per cent perfect fruition. Thank you very much for everything you've done and for your evidence today.