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Tuesday, 18 September 2012
Page: 10968


Mr TUDGE (Aston) (12:16): I rise also 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. Everyone in this House no doubt shares the view that charities and non-profits do vitally important work across the community. They run many of our great hospitals and they run a third of all of our schools. They provide fantastic opportunities for our young through sporting clubs. They provide services for aged care. They run the RSLs. They care for thousands of people who are impoverished or in need of some sort of assistance, often through the churches or other Christian organisations.

We therefore all no doubt share the aim that we should be doing everything that we can to support the not-for-profit sector and, most importantly, this means from a governmental perspective allowing these organisations to get on with what they do best—that is, serve their community—and minimise the amount of bureaucracy that they face. These bills were intended to do just this but, unfortunately, they do the exact opposite. For this reason the opposition is firmly opposing these bills.

The bills themselves create a new federal charities commission, which has the intent of being a one-stop shop for the non-profit sector so they do not have to deal with multiple different agencies and report multiple times—a fine intent. But the bills do not go anywhere near achieving this intent. Indeed, the problem is that the bills in fact add an additional layer of reporting for these community organisations but do not remove a single layer in the process. Why is this so? Because the existing reporting bodies are largely at the state government level, although there are some federal ones also. Yet the federal government has held very few consultations and negotiations with the state governments to ensure that they would remove any of their reporting requirements before, or at least in alignment with, the introduction of this new commission. Indeed, at the Parliamentary Joint Committee on Corporations and Financial Services inquiry into these bills, the Interim Commissioner of the ACNC Implementation Taskforce told the committee that no state or territory government had entered into a memorandum of understanding with the Commonwealth to participate in the new arrangements—not a single one. As the member for Bradfield pointed out earlier in this debate, when one of the senior Prime Minister and Cabinet officials was asked in the hearings why these new reporting arrangements were put in place before arrangements were made with the states and territories, he simply replied:

Our view—and, I must say, with considerable experience of COAG processes—is that that would take many years to do.

What this official meant was that it would take many years of working diligently with the state and territory governments to ensure that they worked cooperatively and removed their layers of bureaucracy before this new layer of bureaucracy was added or in concert with this new layer of bureaucracy being added. But instead of the government doing this, instead of the government embarking on a process, taking its time and deliberately working through with the state and territory government to do this and then at the end of the process introducing this legislation, it has simply added another layer of bureaucracy on top of it all. This also means that we will now be stuck, if these bills are passed, with duplicating regulations for many years to come. We know that the states and territories are very reluctant to give up their powers. What this means in practice is that charities and non-profit organisations will do less of serving the community and do more of preparing duplicative paperwork for no particular purpose or objective.

The Baptist Church of Australia estimates that it will have to spend an additional $1 million per annum of its scarce resources to meet the new requirements inherent in these bills—$1 million from just one of our churches in Australia. The next time the offertory bowl is passed around at Baptist churches, including at the Rowville Baptist church in my electorate, some of that money given by the parishioners will be paying for this new red tape which is being imposed through these bills. That is the bottom line. What an absolute waste. The Baptist Church is not the only charitable organisation that is concerned about this new layer of bureaucracy. Dozens of organisations have come out to express their concerns. Let me mention a small sample of them. The Anglican Diocese of Sydney has said:

It is likely that we will need to employ someone on a full-time basis to deal with the compliance issues that this legislation is likely to raise ...

The Australian Council for International Development, which represents many charitable organisations, says:

The present drafting of the ACNC Draft Bill does not reassure ACFID or its members that it will actually reduce red tape … The drafting indicates that there is yet to be agreement with the States … it does not deliver a 'one-stop-shop' for the establishment of a charity or reporting by a charity …

Catholic Health Australia says:

… the effect of the Bills would be to add additional regulation to the operation of most not-for-profit organisations.

Catholic Social Services says:

… there can be no confidence that reductions in red-tape and duplicative reporting by Commonwealth agencies … will diminish in the foreseeable future.

The Independent Schools Association says:

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

The independent and Catholic schools already have to report to myriad bodies, and now this is a further one laid on top of all the existing reporting mechanisms. I know the government is going to be moving amendments and it will enable schools to avoid having to provide this additional reporting—but only for three years. At the end of this three years there will be this additional layer of bureaucracy once again. Mission Australia says:

… the bill is not sufficiently well balanced by a commitment to enable the not-for-profit sector to reduce duplication of reporting.

The Salvation Army says similar things, as do UnitingCare, World Vision Australia, the YWCA et cetera—I could go on almost all day with all of the people from the different not-for-profit sectors who have come out against the bill, or who have at least expressed their strong concern about the extra layer of bureaucracy which these bills are adding.

The extra layer of red tape is my primary concern about this legislation, but it is by no means my only concern. I am also particularly concerned about the powers that this commission is being given. They are extraordinary in their scope and may have the impact of deterring members of the public from taking up voluntary roles within the sector. For example, there are broad powers to investigate any breach of the law and powers to remove a responsible person. Extraordinarily, this would mean that the commission could remove ministers of parishes and congregations, in a manner which is totally unprecedented in this country. For a state agency to be going inside a church and removing a minister of a parish or a congregation would be extraordinary. This legislation also gives the power to the commission to deregister an organisation if it is conducting its affairs in a way that may cause harm to or jeopardise the public trust and confidence in the not-for-profit sector. But the phrase 'public trust and confidence' is not defined and remains unclear, which of course creates enormous uncertainty and means that the legislation is likely to lead to expensive litigation.

David Gonski, of the Australian Institute of Company Directors and a friend of the government, points out that this legislation may well make Australia the first country in the world to make being on a not-for-profit board as a director more onerous than being on a for-profit board. It is going to make being on a not-for-profit board more onerous than being on a multibillion-dollar for-profit board—extraordinary. Why do we need these extra layers of bureaucracy and reporting? Why do we need such intrusions and such harsh penalties? If this were applying to trade unions, after all the scandals of the Health Services Union and the AWU et cetera, then I could understand that we would here debating the need for additional regulations to fix up the loopholes in the law. But what is the mischief that this legislation is intended to address? The government needs to make its case that there are problems within the existing system, and it should do so inside this parliament before it brings to this parliament bills such as the ones we are debating here. It has failed to do so. It has failed to mention any examples which it can point to which provide the basis for needing to strengthen our laws or to provide additional reporting requirements for every single not-for-profit across the country.

At its heart, this legislation suggests a mistrust by government of those in the community sector and a belief that the federal government should be at the centre of all national activity. It is a belief that government must be the guarantor of probity and policing of all our actions. I submit that this is the wrong approach. A civil society is fundamentally based on individuals and families freely associating to pursue their mutual societal, cultural, religious, sporting or other communal interests. They are neither instruments nor agents of the state but they are the community groups which hold our society together, that care for the sick, that support one another, that provide activities of mutual interest and that provide the vitality for our nation. They are built, most importantly, on trust—and on community spirit and mutuality, but most importantly on trust.

As the member for Menzies pointed out earlier in this debate, our civil society, built on the free association of individuals, preceded the modern nation-state. If we damage our civil society, the state cannot replace it. If our civil society breaks down, the state cannot regulate its regrowth.

I have seen the breakdown of civil society, of mutual trust and reciprocity, in remote Aboriginal communities where I have worked. The state cannot rectify this. We have had that experiment and it has failed. If anything, the state needs to back out of the Indigenous community somewhat to let the civil society grow again and to restore the Indigenous elders' authority and restore community voluntary activity, rather than the state being in there intruding in every single aspect of people's lives.

My fear with this bill is that it empowers the state over our civil institutions when, if anything, we should be freeing our civil institutions from state power. I say, let our charitable institutions —the churches, the Salvos, the schools, the RSLs, the sporting clubs and the other not-for-profit community organisations—do what they do best and that is serve the community to enhance and enrich our society. This bill does not support this goal. Consequently, it should be firmly rejected.