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Tuesday, 18 September 2012
Page: 11053


Mr OAKESHOTT (Lyne) (18:21): I have listened closely to this debate and followed the progress of the Australian Charities and Not-for-profits Commission Bill 2012 and the Australian Charities and Not-for-profits Commission (Consequential and Transitional) Bill 2012. Whilst respecting all members in this chamber, there are some arguments that have been presented that I just cannot accept as valid. One of those is an argument that we heard from the previous speaker, that the legislation is rushed. I would suggest to the House that six reviews into the regulation and taxation of the not-for-profit sector in Australia over the last 16 years is anything but rushed. The time has come for greater coordination and to have some consistency built into the charities and not-for-profit sector. Likewise, an argument I have heard in this debate is that this legislation is somehow tokenistic. In my view, again, coordinating the not-for-profit and charity sector and building consistency into what is a fragmented regulatory framework is hardly a tokenistic policy.

Likewise, the third argument I have heard presented by several speakers is that this is somehow an incursion on states' rights. Listening to the arguments presented when we hear those claims in this chamber, I feel we have drifted back to the days of George Reid and Edmund Barton and to the point of the very existence of this chamber. Everything we do could be built as a case of an incursion into states' rights. The question, though, is: are we nation building by doing what we are doing and are we contributing to the common wealth by having a Commonwealth that builds harmonised and coordinated approaches to issues of importance on the national agenda? While any claim can be made on any piece of legislation in this chamber that it is some sort of incursion on states' rights, let us put to bed the arguments of George Reid and why we even have a Commonwealth and let us get on with the job of nation building.

In my view, the historic legislation being presented to the chamber today is nation building. The not-for-profit regulatory framework has for many years failed to meet the needs of the sector itself and the community of Australia. It has not met the needs of government or the needs of the Australian public. In my view, the regulatory framework is inconsistent and fragmented, it is uncoordinated with regulatory responsibilities spread across a range of government agencies, it produces complex reporting requirements which sometimes overlap—and that is a waste of time for everyone involved—and it provides inadequate public information. The engagement from community as to what is a charity in Australia, what is the not-for-profit sector and how does someone participate in that sector is really difficult to establish. So there are problems in the existing regime.

Worse, the regulatory burden faced by not-for-profit entities diverts the very scarce resources of those entities away from the intended targets towards administration and compliance. Anyone who is arguing against this piece of legislation, therefore, is arguing a case for administration and compliance burden on the not-for-profit sector in Australia. In my view, the existing regime has elements that are a waste of public money, a waste of private donations and a waste of time for the many people involved. Fragmented and inconsistent information, coupled with a lack of publicly available information, deters the culture of philanthropy in Australia.

As I said before, there have been six reviews into the regulation and taxation of the not-for-profit sector in Australia over the past 16 years. The time has come for this legislation. A consistent theme of these reviews has been that the regulation of the sector could be improved by establishing a national regulator and harmonising regulatory taxation arrangements.

In as late as 2010, the Productivity Commission said that sound regulation of not-for-profit entities is important to build and maintain trust in the sector. The Productivity Commission said a number of previous inquiries and reviews had identified concerns with the regulation of not-for-profit entities but few recommendations to date had been implemented. The Productivity Commission said the not-for-profit sector would benefit from the same attention that has been paid to simplifying and improving business regulation. Again I say to those opposed, if it is good enough for business regulation to be nationalised and harmonised, why is it not good enough for the not-for-profit sector to be nationalised and harmonised?

The Productivity Commission said the current regulatory framework for not-for-profit sector entities is characterised by uncoordinated regimes at the Commonwealth level and at state and territory levels. That is not an argument for the Commonwealth to back out; that is an argument for the Commonwealth to step up, to harmonise and coordinate what is a fragmented market that goes back to the days of state and territory levels running the show. The Productivity Commission also said that disparate reporting and other requirements add complexity and cost, especially for organisations operating in more than one jurisdiction. So the Productivity Commission recommended a national registrar acting as a one-stop shop to bring together current Commonwealth regulatory functions, including tax endorsement, in the incorporation of not-for-profit entities. A national registrar would provide a national registry for cross-jurisdictional fundraising organisations and activities, easing the burden on the entities themselves.

The Productivity Commission said that the states and territories remain well placed to regulate smaller and state based not-for-profit entities. Many have been moving to reduce compliance burdens. These could be further reduced by harmonisation of legal and reporting obligations, including for fundraising, but substantially there is a national benefit in providing for an overall coordinated approach through a national commission, as presented in these bills.

The bills before the House are a welcome attempt to address these issues. I commend the amendments to the bills. The amendments reflect matters raised during the consultation period by affected organisations such as various churches. I particularly mention the Australian Catholic Bishops Forum, which identified some anomalies—not, as far as I can see, to their benefit ultimately but to the national benefit in improving some of those minor amendments and including them in the bills before the House. I have received similar direct representations from them at a local level and, as I say, as far as I can see, they are sensible amendments for all.

So these amendments improve the bill by protecting the independence of registered entities, by ensuring that the governance standards cannot prevent or constrain a registered charity from undertaking important advocacy functions. They make the government's commitment to consultation on the governance standards an express requirement. They allow basic religious charities to operate deductible gift recipient funds, authorities or institutions that generate annual revenue of less than $250,000 without the need to obtain a separate Australian Business Number. They also simplify the process for providing notifications about changes to governance standards for multiple registered entities.

The not-for-profit sector plays a vital role in our communities, and if we as legislators can provide the sector with a more seamless framework and one which enhances their public standing then their work can only go from strength to strength. I want to acknowledge all the very many charities and not-for-profit organisations whose work is very often the glue that holds societies together. They provide hope when hope is thin on the ground.

Overseas experience demonstrates that setting up a charity regulator requires time, expertise and sector input. I ask the not-for-profit sector to stay engaged with this reform process and keep providing feedback and ideas about how we can keep improving the regulatory environment they inhabit. An independent one-stop shop regulator has been sought for many years by the sector and recommended in several recent reports and inquiries to reduce regulatory overlap and increase transparency.

To fully realise this ambition will require the support of the Commonwealth and each of the states and territories. To stay competitive and productive we do need reform, and we do need this parliament to drive the reform. We need to start thinking and acting like a nation, not a rag-tag bunch of colonies as per the George Reid arguments of over 100 years ago. We need to be more responsive and move quickly through the use of this chamber to build a national agenda. As in so many other areas, we need to overcome the roadblock of a fragmented federation with its various rules and regulations. This is, in this area, the chance to deliver on that goal.

Finally, given that in many jurisdictions here the scope of government is shrinking, the work of the not-for-profit sector is more important than ever. Our churches, our social and sporting clubs and our science and research foundations are meeting needs and bringing about positive change across so many aspects of our lives. That is why I think this is historic reform and a fine example of what we can achieve as a parliament when we think and act as a nation.