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Monday, 17 September 2012
Page: 10768


Ms GAMBARO (Brisbane) (17:22): I rise to speak on the Australian Charities and Not-for-profits Commission Bill 2012 and the Australian Charities and Not-for-profits Commission (Consequential and Transitional) Bill 2012. As the shadow minister and other members on this side have indicated, the coalition will be opposing these bills.

These bills are of particular interest to me, both as the member for Brisbane and as the shadow parliamentary secretary for international development assistance. They have applications in both those areas. The Australian Charities and Not-for-profits Commission Bill 2012 and the associated bill create a new regulator for the not-for profit sector. These pieces of legislation create a new independent statutory office, the Australian Charities and Not-for-profits Commission, or ACNC, as it will be known.

I congratulate and pay tribute to all of those people and community groups that work in the not-for-profit sector for the incredible work they do in enriching other people's lives in our community. They are made up of all sorts of entities that are neither commercial nor government. This sector plays a critical role in enhancing our communities culturally, socially, economically, environmentally and, much more importantly, provides assistance and support for the most vulnerable people in our community.

I want to recognise and salute the fantastic work that the not-for-profit organisations in my electorate of Brisbane do and the incredible contribution they make to our local community. Whether they are churches, charities, industry associations, aid associations, animal welfare associations, sporting clubs, veterans associations or the many hundreds of organisations that work diligently on behalf of the people of Brisbane, I want to acknowledge them foremost and congratulate them on the fine work they do in enriching our society. Never was this more apparent than when we had the 2011 floods in South-East Queensland. A whole host of these organisation were out there on the ground immediately doing a superb job and helping those in need who had their livelihoods and their possessions devastated by that terrible tragedy.

I also want to make special mention of a great organisation called ChaplainWatch, which works in my electorate. Many members would be aware the electorate of Brisbane contains the Fortitude Valley, which is the social playground of Brisbane. It is a major social precinct. Every weekend approximately 30,000 people—mostly young people—flock to the Valley for a night out. ChaplainWatch has a weekend patrol service that is dedicated to helping those in need or in crisis during the late-night hours in the Fortitude Valley. Those night do not always end happily, unfortunately. ChaplainWatch provides a service to those in potential situations of getting into trouble and provides assistance with a number of incidents that occur in the Valley. Last year they attended 880 incidents involving 1,215 people. In many instances it is a case of just being there to diffuse situations that can become very explosive, particularly when alcohol is involved. They provide an incredible service. I want to thank Lance Mergard and his wonderful team for the great work they do. They recently visited me and expressed a need for another vehicle so that they can expand and continue the wonderful work that they do. They do this work not only in the Brisbane CBD and Fortitude Valley but also in Caxton Street.

Given the government's priority regarding not-for-profit organisations, they should encourage the work that ChaplainWatch do. You would think the goal would be to try and relieve the burden of regulation on not-for-profit organisations so that they can concentrate on the great work that they do and so that they can help more and more people, instead of having to spend more of their valuable time and resources on dealing with more regulation and more paperwork. These bills do not support these organisations; in fact, all they do is add more red tape and more compliance costs to this very important not-for-profit sector.

We oppose the government's proposed new regulator for charities and not-for-profits because it will not reduce red tape; all it will do is add another layer of red tape. It treats the sector as untrustworthy and the people involved in it as tainted; it will hinder the activities of charities and not-for-profits; and it will clearly discourage involvement in civil society. It is also very clear, from the deliberations of the House Standing Committee on Economics inquiry into these bills, that the sector does not support it either.

As we know, the not-for-profit sector is currently regulated at a state government level. The states have not agreed to hand over any of their powers with respect to charities and not-for-profits to the Commonwealth, so the new regulator will simply be an another layer of needless red tape. Unless and until the states and territories agree to hand over their powers to the Commonwealth regulator and harmonise their laws, these bills are going to add more and more layers of red tape, which the sector will have to meet.

These bills set up a framework for a set of governance standards which will apply to most registered entities and will cover things such as the content of an entity's governing laws, the conduct of the entity and the processes that the entity has in place. This legislation also imposes a range of reporting requirements on the not-for-profit sector. As other members have noted, some of these not-for-profit entities have to comply with the Corporations Act, the state regulator, ASIC, any government department it receives grants or funding from and many more regulatory bodies. And now there will be one more—the ACNC.

An independent school in my electorate gave me a recent example. A lot of independent schools are quite worried about this legislation. They have boards and entities set up for their operations and other activities. Many of them have old boys' or old girls' associations. They have foundations that promote philanthropy

This school has asked to remain anonymous at this stage, but they are very concerned—they are concerned particularly about compliance, and they are concerned about the reporting regime. Independent schools currently report through DEEWR on their full financial status and they report in the required DEEWR format. They are already having to submit audited financial statements to DEEWR annually.

As well as that, independent schools in Australia already have extensive information available to the public on the My School ACARA website. This applies to all independent schools, regardless of which ACNC registered entity category they are in. Requiring independent schools to report similar but different data to the ACNC is just adding another unnecessary layer of red tape. In addition, independent schools also provide regular financial reports to their state government. This could result in independent schools requiring more administrative positions to fulfil all of the reporting requirements, again taking away funds from the delivery of much needed front-line educational services and positions.

The proposed compliance processes appear to be more onerous than those of public companies. In addition, the independent sector is most concerned about reporting requirements when schools receive donations—will there be an additional level of reporting when they fundraise? It goes on and on. The second concern relates to the statutory definition of the word 'charity'. The sector is concerned about the time and financial costs of having to prove public benefit when this notion has been long established. It is important to remain charitable to again reduce compliance costs for schools, focus on education and reduce fees to parents.

As regulations on the governance of entities are yet to be defined, these schools just do not know what these will be and how they will impact on them. There is a great deal of confusion out there. The schools representative said to me via email:

Schools don't mind being transparent it is just very hard when you need to redo numbers in four different formats depending on who you report to ...

These bills now impose a whole new level of regulation and uncertainty on schools. This unfortunately means the diversion of resources into compliance instead of contributing to the education of students.

Another part of the NFP sector that will be hurt is sporting clubs and associations that have NFP status. Not only do they have additional insurance and safety responsibilities which require high levels of compliance; now they will also have ACNC reporting requirements to adhere to as well. Also, keep in mind that a lot of clubs are manned by people who dedicate their service to volunteering, and they will now have this additional burden placed on them.

The ACNC will have far-reaching powers; powers that will elevate it to being one of the most powerful Commonwealth regulators. These bills provides the ACNC with the authority to issue warning notices, issue directions, enter into enforceable undertakings, apply to the courts for injunctions, suspend or remove responsible entities, and appoint acting responsible entities. Interestingly, the Australian Catholic Bishops Conference said:

The lengthy list of powers proposed in the ACNC Bill focuses on matters which appear more appropriate for a criminal investigation authority rather than a body which is intended to promote and educate.

The sector is also concerned that there is currently no single reference point for the NFP sector to access information, education or guidance. That is why the coalition supports a smaller commission to engage in innovation, advocacy and education.

This government is effectively reversing the current approach, telling the sector they need a watchdog to promote transparency and trust from the sector. The community trusts the sector and there has been no evidence provided by the government that problems exist to the extent that warrants the suite of powers that would be granted to the new commissioner.

In conclusion, the coalition opposes these bills because we want to relieve the burden of regulation for the not-for-profit entities and organisations. Unfortunately, these bills do the exact opposite.