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Monday, 17 September 2012
Page: 10796


Mr VAN MANEN (Forde) (19:18): Before I commence my contribution to this debate on the Australian Charities and Not-for-profits Commission Bill 2012, I have a couple of comments on the contribution by the member for Parramatta. It is quite clear from her contribution, when you look at the list of corporate not-for-profit organisations she quoted, that once again we have a government that is pandering to the big end of town, the people who have the capacity to manage this new bureaucratic nightmare. As the member for Higgins quite rightly said, this is another example of this government finding a solution that is looking for a problem in the first place.

There are a number of issues with respect to this legislation that I would like to touch on. The most obvious centres around the duplication of regulation and red tape in a sector that is already struggling with existing regulations and—more importantly—coupled with a tough economic climate. The government has thus far failed to establish how the ACNC would work with existing state and federal government agencies to reduce the additional layers of regulation that will be imposed on this sector. Furthermore, the government has not made any progress with key agencies like the Department of Education, Employment and Workplace Relations in relation to the duplication of regulation.

It probably should not puzzle me—but it does—why the government would impose additional red tape on the independent school sector. How is this a part of the 'education crusade' to ensure that children get the education they deserve when independent schools will be subject to more reporting requirements and additional paperwork? In the words of the Independent Schools Council of Australia:

It is far from clear that an agreement could be reached with the states, territories and government agencies to remove many of the operational requirements for non-government schools already in existence.

They also said:

The regulatory burden will be increased on individual non-government schools creating costly and confusing duplicative governance and reporting situation.

They went on to say:

Requiring independent schools to report similar but different data to the ACNC is supplicating effort and adding to the red tape.

These are very valid points and I would urge the government to address this issue before placing any unnecessary strain on these schools and ultimately the future of their students.

Another concern is how the not-for-profit sector will continue to enrol the people who drive these organisations under the proposed penalties, which could potentially act as a deterrent for members in the volunteer sector. Of particular concern are the information-gathering, monitoring and sanctioning powers, including the ability of the ACNC commissioner to remove a director. In his submission to the House Economics Committee inquiry, David Gonski, of the Australian Institute of Company Directors, raised the issue that Australia may be the first country in the world to make being a not-for-profit director more onerous than being a director of a company. Whilst I mention the Australian Institute of Company Directors, the member for Parramatta touched on the issue of education and training. It is sometimes instructive to have a look at what is on offer in the marketplace, because the Australian Institute of Company Directors actually has a course specifically designed to train directors of not-for-profit organisations in how to carry out their duties. To make the duties of a director of a not-for-profit organisation more onerous than those for a for-profit organisation is counterintuitive to the whole idea of the not-for-profit sector. Add to these concerns the fact that the sector had as little as nine working days, in some cases, to make a submission and you have to wonder if the government is really listening to the concerns of the not-for-profit sector before making these decisions that will affect how they serve our local communities.

The coalition believes the government should stop this unnecessary interference and let the approximate 600,000 entities in the not-for-profit sector do what they do best for our communities. Under the banner of the charitable sector there are a number of services that include the work of some of Australia's most well-known organisations, such as the Australian Red Cross, World Vision, the Smith Family, the RSPCA, AusAID as well as Australia's religious community.

In my electorate, local community organisations including Nightlight, NAPCAN, Helping out Children, Fishers of Men, the Queensland Youth Housing Coalition, Eagleby Salvation Army, Soroptomist, Lions Clubs, Rotary, the Eagleby Community Association, the Benevolent Society, St Vincent de Paul, Quota, Junior Quota, Beenleigh PCYC and Tudor Park PCYC, the Probus Club, Neighbourhood Watch, Beenleigh Scouts and the Loganlea Community Centre are just some of the organisations that lift people from within our community, particularly those from low-socioeconomic backgrounds. These organisations represent just a small portion of the community services and charitable organisations in my electorate. If they suffer at the hands of government so will the people who depend on them in my local community.

To stress how important the strength of the not-for-profit sector is, I would like to share with you an article from a week or so ago in one of our local newspapers. The headline reads: 'More families seek help from charities'. The article says:

Cost of living pressures have taken their toll on low income families with an increasing number of people accessing welfare agencies for food and some even stealing items such as frozen vegetables to get by.

The article stated that Foodbank, the country's largest hunger relief organisation and pantry for many welfare groups, released a report showing that more low-income families are accessing food from welfare agencies than are homeless people.

Our local food welfare services include Lighthouse Calvary Care, the Twin Rivers Centre and, the newest addition, the Soul Centre, Upper Coomera Community Pantry. These organisations are all part of the not-for-profit sector and are dedicated to providing the local community with low-cost alternatives to fresh and packaged foods and other domestic items. These organisations do not just help feed people within the confines of the local community. I have heard that people drive from as far as the Sunshine Coast, the Gold Coast and other areas to access these services.

Outside my electorate, the Tribe of Judah food parcel service in Kingston said they service around 3,000 people per week. Multiply that across the other three organisations in my electorate and it is fair to say that these four food welfare groups could feed up to 9,000 people from in and around the electorate each week. According to the End Hunger report, 70 per cent of welfare agencies were experiencing an increase in the number of people seeking food and 90 per cent report not having enough food to meet total demand. This is a real issue that needs addressing. The establishment of the Australian Charities and Not-for-profits Commission will not result in one extra crumb of food for these organisations. All it will result in is additional reporting requirements that will in turn move resources away from frontline service delivery.

Not-for-profit organisations have raised the issue that reporting requirements are inconsistent across the sector, increasingly and excessively complex and burdensome, requiring these agencies to divert resources away from front-line service delivery and towards complying with the needs of government. The best thing we can do for these organisations, as we can for the broader community, is to get out of people's lives and organisations and let them do what they do best.

The sector is also concerned that there is currently no single reference point for the not-for-profit sector to access information, education or guidance—as I touched on earlier, there are some organisations that provide some courses. That is why the coalition supports a small commission to engage in innovation, advocacy and education. The coalition will seek to implement one contact with the department for each agency, instead of multiple contracts; require the department to negotiate the content of the contracts with the agencies, instead of simply imposing it upon them; simplify the auditing process to require only one financial report from each agency annually; replace the current system of rolling audits with an initial benchmarking audit that has a period of five years, with spot audits to be undertaken if the Commonwealth is made aware of any adverse conduct on behalf of the agency; simplify reporting requirements for governance arrangements, with registration as a company or an unincorporated association sufficing as evidence of appropriate governance arrangements; require all agencies to lodge a one-page annual governance return, by the chairperson of the board or the governing body, indicating the agency is properly governed; replace the current time-consuming and costly system of data collection with a requirement that each agency file a quarterly report indicating the number of clients seen by the agency according to program area and postcode of the client; require each agency to publish on its website its annual financial return and an annual governance statement; replace the current system of data collection with a series of cross-sector evaluations of the efficiency and effectiveness of various programs; and, work with the sector to ensure adequate and known whistleblower provisions are in place. It is envisaged that these changes will ensure the agencies are able to focus their time and resources on delivering vital services to the community. They will also make clear that the government is supporting and empowering the valuable work of these agencies, not directing them as an arm of the state. Importantly, they clarify that the responsibility for the conduct of the services rests with the agencies themselves, not the government. If an agency, or a person associated with it, acts improperly, they are subject to existing laws. In addition, the government may withdraw financial support if the public trust conferred on them is broken.

These changes will save on expenditure for both the department and the not-for-profit agencies involved. In particular, it will remove the need for the costly and time-consuming FRSP Online—the department's data collection system. The measures will reduce reporting requirements by a significant margin. The savings generated by agencies through the implementation of these measures will allow them to provide the services they need to provide.

In conclusion, it is time the government addressed its obsessive-compulsive behaviour on regulations. Since 2008, some 18,000 regulations have been added to the books and only 86 have been repealed. Each day, on average, 11 new regulations are created. What proof is there out there that this is adding value to any of our sectors, including the not-for-profit sector?

I would like to leave you with this statement from a 2009 policy brief from the Organisation for Economic Co-operation and Development:

For many OECD member countries, reducing the burden of government regulations on business and citizens is a large part of their strategy to improve economic performance and productivity. In particular, small companies may spend disproportionately high resources to understand government regulations and to transmit required information to governments. The European Commission estimates that GDP would increase by 1.4% in the European Union, if member countries reduced administrative burdens by a quarter.

The easier it is for businesses and citizens to comply with regulations, the higher the probability that a regulation will achieve its objective.

It is clear that, yet again, it is the coalition who have the clarity and vision to provide practical legislative outcomes for the community. Therefore, as we have indicated, we will oppose these bills in their current form and encourage the government to go back to the drawing board and have some more detailed conversations with the states, territories and key government departments to finish the job they said they were hoping to achieve and actually reduce red tape for the not-for-profit sector.