National Health Service (Procurement, Slavery and Human Trafficking) Regulations 2025

Considered in Grand Committee

Moved by

That the Grand Committee do consider the National Health Service (Procurement, Slavery and Human Trafficking) Regulations 2025.

It is a privilege to represent His Majesty’s Government in bringing forward this important secondary legislation, and I am very grateful for the opportunity to present it for your Lordships’ careful scrutiny today.

Slavery remains one of the greatest evils in human history. This Government cannot and will not accept that we might inadvertently support forced labour or human trafficking through our supply chains. I wish to acknowledge the cross-party and Cross-Bench support on this issue, both in this House and in the other place. I pay tribute to all noble Lords, and to distinguished Peers such as the noble Lords, Lord Hunt of Kings Heath and Lord Alton, and the noble Baroness, Lady Brinton, who have all worked tirelessly to keep modern slavery at the forefront of our national conversation.

I will begin by setting out why these regulations are necessary. Many are shocked to learn that there are more enslaved people now, in absolute terms, than at any point in history. It is estimated that around 50 million people worldwide are living in modern slavery. Globalisation has brought immense opportunities for trade, but also for exploitation. We in the United Kingdom are not immune from these global networks of human trafficking.

In late 2023, the previous Government published a review into NHS supply chains, covering 60% of medical consumables—£7 billion of spend across over 1,300 suppliers, representing 600,000 products. The review found that just over a fifth of suppliers represented a risk. We know that staff working in the NHS would be appalled to learn that surgical items and face masks could be contaminated by modern slavery. I know I share this revulsion with colleagues across the NHS and across this House.

The review also recognised the wider benefits to the NHS of a better understanding of our supply chains, including improved product quality and supply resilience. It gave us clear recommendations, and today I am proud to present landmark modern slavery legislation to put these policies into practice. This is a first for England, and I hope our colleagues in the devolved Administrations will follow suit.

The NHS is one of the largest public sector procurers in the world, with an annual spend of around £35 billion and business with over 80,000 suppliers. We have a duty to ensure that no products we procure are tainted by forced labour, and an opportunity to use our purchasing power for good. These regulations will require all public bodies to assess modern slavery risks in their supply chains when procuring goods and services for the health service in England. They give effect to a duty established by the Health and Care Act 2022 requiring the Secretary of State to eradicate modern slavery wherever it is found in NHS procurement.

Public bodies will be asked to take reasonable steps to address and eliminate modern slavery risks, especially when designing procurement procedures, awarding and managing contracts, and setting up frameworks or dynamic markets. Reasonable steps may include enforcing robust conditions of participation, monitoring supplier compliance, reassessing risk through the contract’s life and requiring immediate mitigation where instances of modern slavery are discovered.

My Lords, I am grateful to the noble Baroness, Lady Wheeler, for her clear and helpful introduction to the regulations. This is, quite rightly, a moment for us all to express collective support. The measure before us today is fundamentally about the moral application of public money. The NHS is arguably one of the largest single procurers, if not the largest, of goods and services in the country. When taxpayers’ money is spent, it must not, in any circumstances, inadvertently finance or sustain the abhorrent practice of modern slavery or human trafficking. This instrument, which is rooted in the Health and Care Act 2022, serves as a powerful declaration that our healthcare system will not tolerate this barbaric crime.

Having said that, I am a little confused on a point of governance and accountability. The Government’s Procurement Policy Note 009 Tackling Modern Slavery in Government Supply Chains already states unequivocally:

“This Procurement Policy Note (PPN) applies to all central government departments, their executive agencies, and non-departmental public bodies and NHS bodies when awarding public contracts”.

Given that PPN 009 already binds the NHS to a risk-based approach, will the Minister explain the precise interplay between these two existing policy requirements and the new statutory instrument?

In answer to questions placed by the Secondary Legislative Scrutiny Committee in its 37th report, on page 23, the Government seem to suggest that somehow this will be a more mandatory approach. I therefore seek to find out exactly how that interplay works out. Importantly, we need to understand what the fundamental flaw is in the existing PPN system that has led the Government to conclude that a policy note is insufficient to protect public money, compelling them to introduce new secondary legislation to ensure that the NHS supply chain is truly free from the stain of modern-day slavery and human trafficking. Are they saying that for other departments the PPN is not sufficient and there is a weakness within other public sector procurement if they do not introduce the equivalent of what the NHS is doing in this statutory instrument?

Secondly, on the interpretation of “reasonable steps”, the efficacy of this entire measure hinges on what constitute reasonable steps in the procurement phase and, crucially, during contract management. This phrase is a legal term of art and without precise, actionable and proportionate statutory guidance to which bodies must have regard as part of this statutory instrument. We therefore risk inconsistency. What is reasonable for a local clinical commissioning group in procuring office supplies which are very different goods? What is reasonable for an NHS trust procuring goods such as surgical gloves from a global market? If the guidance is too vague, it will be ineffective; if it is too prescriptive, it will stifle the necessary quick-response procurement. I note that page 24 of the Secondary Legislation Scrutiny Committee’s report states:

“NSHE”—

that should be “NHSE”, I think—

“are aiming to publish the updated guidance in October 2025”.

Has the guidance on this now been updated and published?

Lastly, on the risk to the supply base, we must be vigilant that the new due diligence requirements do not inadvertently create a disproportionate barrier to entry for small and medium-sized enterprises, particularly innovative British companies. If the compliance burden is too heavy, we risk contracting solely with larger multinational corporations that are better equipped to handle the bureaucratic burden, thereby narrowing our supply base and sacrificing local innovation. The intent is to tackle slavery, but it must not damage legitimate British businesses in competing for NHS contracts.

I accept that these regulations are a necessary and welcome commitment to our shared moral responsibilities, but we must ensure that they come hand in hand with pragmatic planning, so I have three further questions for the Minister concerning the successful implementation of this statutory instrument. First, given the mandatory nature of the risk assessment and monitoring duties, what specific ring-fenced funding mechanism will the department put in place to ensure that individual NHS bodies have the capacity and specialist staff required to execute the continuous due diligence mandated by these regulations? Secondly, how will the accompanying statutory guidance ensure that the definition of “reasonable steps” is proportionate so that we do not unintentionally exclude innovative small and medium-sized enterprises from the bidding process, due to an inability to meet disproportionately high compliance costs?

My final question concerns the termination of a contract. Does the duty for a public body to take reasonable steps in contract management, as outlined in the statutory instrument, legally survive the termination of the contract if unresolved outstanding modern slavery concerns relating to service provision remain? I understand the importance of these regulations—as I say, I support them—but some of the details need to be spelled out so that we understand fully whether this measure can and will be implemented in a reasonable, funded way.

My Lords, His Majesty’s loyal Opposition are grateful to the Minister for introducing these regulations, which seek to extend and strengthen the framework for addressing modern slavery and human trafficking risks in NHS supply chains. This is an issue on which there is—and must always remain, ad aeternum—cross-party consensus. No public body, least of all our flagship National Health Service, should ever be associated, however indirectly, with the exploitation of vulnerable people.

The Minister confirmed that this will not be an easy task. We must acknowledge the scale of the challenge to be addressed; this is absolutely not a storm in a teacup. The department’s own review in 2023 found that 21% of NHS suppliers were assessed as being at high risk of slavery or human trafficking, particularly in the supply of gloves, gowns and surgical instruments—essential items that are used day in, day out in our hospitals to save lives. The findings were deeply troubling and underlined the need for consistent, enforceable action.

When we were in government, we took the first steps to make this situation good through Section 81 of the Health and Care Act 2022, which provided the legal foundation for these regulations. We therefore welcome the fact that this Government have now chosen to bring that framework into effect. However, it is not entirely clear cut; we therefore request further clarity from the Minister on a number of areas.

First, the noble Lord, Lord Scriven, highlighted implementation and enforcement. The regulations will require public bodies to take “reasonable steps” to address modern slavery risks, but what will that actually mean in practice? What exactly will constitute a reasonable step? Who will be monitoring compliance with the regulations? What benchmarks will they use to judge whether a body is meeting all of its key performance indicators—indeed, who will set those key performance indicators? The Explanatory Memorandum refers to judicial review as a possible route of challenge, but surely the system should not have to rely on the courts to act as a last line of defence and to identify failings. Who will actually be the first line of defence?

My Lords, I thank the noble Lord and the noble Earl. I apologise that I will have to write on a number of issues, but I will try my best.

The noble Lord, Lord Scriven, asked what the difference is between PPN 009 and the regulations. PPN 009 sets out policy expectations, but the new regulations provide a statutory basis for enforcement, ensuring stronger accountability and compliance in NHS procurement.

On the impact on SMEs, the regulations do not impose direct duties on suppliers, including SMEs. We cannot accept any amount of modern slavery in our supply chains. The regulations allow for a proportionate approach to avoid deterring SME participation. Early market engagement and tailored procurement design will help SMEs compete fairly.

I turn to implementation, training and support. Guidance, training and tools, such as a central risk assessment tool, are being provided to support NHS bodies. The Department of Health and Social Care will take over guidance responsibilities from NHS England. I was asked what will happen and how the expected powers will be used when NHSE is abolished. All the powers will transfer to the Department of Health and Social Care. They have worked together so far and will continue to do so.

On compliance and monitoring, compliance checks are integrated into the NHSE procurement system that is used by more than 300 NHS bodies. We are encouraging commercial teams to embrace these checks as part of good governance. Line managers have real-time data monitoring, which enables effective oversight and accountability. Procurement regulations allow bodies to exclude suppliers and terminate contracts where risks are not remediated.

On the general concern, I understand totally the pressure on the NHS and on local authorities, which was not raised but is in the back of our minds. It is important that we use the NHS’s purchasing power—estimated at £35 billion—to raise standards across the globe without harming domestic suppliers. Ethical supply chains can still be cost effective in the long term by avoiding scandals, litigation and sudden supply collapse. I can reassure the noble Lord, Lord Scriven, and the noble Earl, Lord Effingham, on the point about NHS burdens and the impact on suppliers.

It is all right for the Minister to reassure the Committee, but have organisations such as the Federation of Small Businesses been consulted and given a view? Have they seen the regulations? Which small and medium-sized businesses have been involved and given the Minister the reassurance to be able to say that?

Again, there was certainly full consultation. I will have to write to the noble Lord on the individual quotas, but we were very concerned to ensure that there was consultation across a wide range of groups.

I thank noble Lords for their valuable contributions to today’s debate and their commitment to ensuring that no goods or services procured are tainted by modern slavery. As I set out in my opening remarks, the NHS is one of the biggest buying organisations in the UK. We have a golden opportunity to leverage its purchasing power to influence supply chains in the UK, in Europe and right across the world. With this legislation, we can send a clear signal that we will not tolerate human rights abuses. I end by reminding colleagues that these regulations are about what we can do not just here in England but in eliminating modern slavery across the globe, and to say: “If you want to do business with the NHS, you must get your house in order”.