The bill nobody can oppose
New Zealand’s Modern Slavery Bill 2026 is a masterclass in political packaging. It targets something nobody defends, it carries bipartisan sponsorship, and it sailed through its first reading with every party except ACT on board. The bill requires companies with annual revenue of $100 million or more to publish annual statements disclosing modern slavery risks in their operations and supply chains. Just under 1,000 businesses will be caught. Penalties include criminal fines up to $200,000 or civil penalties up to $600,000, with personal liability extending to directors.
The problem is not the goal. An estimated 8,000 people in New Zealand were living in conditions of modern slavery in 2021, up from 3,000 in 2016. Since 2009, authorities have identified just 51 victims of people trafficking and secured only four prosecutions. The enforcement gap is real. The question is whether this bill closes it or just creates paperwork.
Diligence gets punished, ignorance gets rewarded
The bill’s liability design contains a flaw that should alarm every boardroom in the country. As Oliver Hartwich argued in a May 2026 analysis, the bill “rewards ignorance and punishes diligence”. A company that never investigates its supply chain, finds nothing, reports nothing, and faces no consequences. A director who commissions a thorough audit and uncovers a problem is personally exposed because they “could reasonably be expected to have known” of the exploitation.
The rational response to this incentive structure is obvious: look less carefully. That is the precise opposite of what the bill’s sponsors intend. The estimated annual compliance cost of $9 million to $18 million will flow overwhelmingly to lawyers and consultants helping companies produce statements that are thorough enough to satisfy the register but careful enough to limit director exposure. Box-ticking, in other words.
The dual-regime headache across the Tasman
Many of the nearly 1,000 businesses caught by the bill already report under Australia’s Modern Slavery Act 2018. The Australian Industry Group’s submission to the New Zealand select committee warned that without alignment between the two regimes, synchronised reporting timelines, and standardised guidance, the bill risks “producing compliance costs that are disproportionate to the Act’s beneficial outcomes.”
This is not an abstract concern. Trans-Tasman businesses would face two different reporting thresholds, two different timelines, and two different liability frameworks for essentially the same obligation. The bill as drafted contains no mutual recognition provisions. That is a fixable problem, but nobody appears to be fixing it.
The evidence nobody wants to discuss
A University of Auckland commentary published in February 2026 raises an uncomfortable finding: supply chain disclosure laws may not reduce exploitation. Citing World Bank research, the analysis found that regional trade agreements banning child labour actually increased its prevalence, while agreements without such provisions saw child labour decline and school enrolment rise. The mechanism is counterintuitive but logical: compliance fines add to business costs, which suppress adult wages, which in turn create conditions for child labour.
This does not mean doing nothing is the right answer. But it does mean the assumption underlying the bill, that transparency creates market pressure that drives behavioural change, deserves more scrutiny than it is getting. MBIE’s own 2023 Regulatory Impact Statement found that 52% of companies did not identify obvious modern slavery risks, only 25% undertook due diligence, and only 27% demonstrated action. Corporate behaviour clearly needs to change. Whether a disclosure register achieves that is a different question entirely.
A compromise that satisfies nobody
The bill is already lighter than what Labour proposed in 2022, which included mandatory due diligence obligations to actively search for and prevent modern slavery. The current version focuses on disclosure and transparency, a deliberate trade-down to secure National support. It bypassed the member’s bill ballot using Standing Order 288 after ACT blocked it through Cabinet.
The result is legislation that NGOs say lacks teeth and businesses say imposes real costs. Both are right. The bill does not require companies to do anything about modern slavery. It requires them to write about it. That is not nothing, but it is a long way from the enforcement action that might actually help the estimated 8,000 victims.
The select committee still has time to fix the two most glaring problems: adopt a narrower liability test that does not penalise companies for investigating their own supply chains, and build in mutual recognition with Australia so trans-Tasman businesses face one regime, not two. Whether MPs have the appetite to amend a bill that nobody can politically afford to criticise is another matter. The modern slavery bill is heading for passage before November. Whether it helps anyone other than compliance consultants remains genuinely unclear.
Sources
- Newsroom: Large New Zealand entities to face new laws on modern slavery (2026-02-03)
- RNZ: The Detail – Modern slavery bill a triumph of parliamentary co-operation
- RNZ: Anti-slavery law uses new rules to bypass ballot
- Oliver Hartwich: NZ’s anti-slavery bill helps no victims but no one dare oppose it (2026-05-26)
- Australian Industry Group: Modern Slavery Bill 2026 submission (2026)
- University of Auckland: The good but misplaced intentions of modern slavery laws (2026-02-21)
- MBIE: Regulatory Impact Statement – Modern Slavery and Worker Exploitation Reform (2023-01-26)