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Tuesday, 18 June 2013
Page: 6046


Mrs PRENTICE (Ryan) (12:39): I rise to speak on the Charities Bill 2013 and Charities (Consequential Amendments and Transitional Provisions) Bill 2013. Hundreds of thousands of Australians each year participate in volunteering across Australia through local sports clubs, Scout groups, surf-lifesaving clubs, religious groups and many other community organisations. The most recent census showed that more than three million Australians participated in voluntary work for an organisation or group. Of course, this figure does not include the many millions of Australians who conduct selfless voluntary work for others in the normal course of their lives without even considering it to be volunteering their time. This disparity is reflected in the Australian Bureau of Statistics 2010 general social survey, which indicated that more than six million Australians volunteer every year, including many from different cultural backgrounds who are frequently not even aware that some of their work in the community is actually volunteering. Their work is funnelled through the charities and not-for-profit sector, with thousands of Australians managing and handling the many hours of administration, financial accounting and reporting, and compliance with federal, state and territory regulations.

These bills seek to replace the common-law definition of charity and charitable purpose with a statutory definition which would apply from 1 January 2014 and would apply across all Commonwealth legislation. The coalition oppose this legislation because we believe that it is not a response to a genuine need or a solution to challenges within the current framework in which the Commonwealth treats charities. It instead imposes further prescriptive regulations on charities already struggling to keep up with administrative and compliance burdens.

The Labor government first announced in the 2011-12 budget that it would introduce a statutory definition of 'charity' based on the 2001 Report of the inquiry into the definition of charity and related organisations, also taking into account subsequent judicial decisions. Key features of the new definition include: an entity must have charitable purposes and must not have an independent, non-charitable purpose; an entity may have incidental or ancillary purposes that may be non-charitable when viewed in isolation but which must aid or further the charitable purpose. Furthermore, the following are presumed as being for the public benefit, unless there is evidence to the contrary: the purpose of preventing and relieving sickness, disease or human suffering; the purpose of advancing education or relieving poverty, distress or disadvantage of individuals or families; the purpose of caring for and supporting the aged or people with disabilities; and the purpose of advancing religion.

The public benefit test does not apply to open and non-discriminatory self-help groups, to closed or contemplative religious orders or where the purpose is directed to one or more individuals in necessitous circumstances as described in the Income Tax Assessment Act 1997. A purpose of engaging in, or promoting, activities which are unlawful or contrary to public policy is disqualifying, which refers specifically to such matters as the rule of law and system of government, as opposed to government policies. A purpose of promoting or opposing a political party or candidate is a disqualifying purpose. Categories of charitable purposes include: advancing health, education, social or public welfare; religion; culture; promoting reconciliation, mutual respect and tolerance between groups of individuals that are in Australia; promoting or protecting human rights; advancing the natural environment et cetera.

The list of categories and the definitions of charitable purposes go on—and on and on. With so much complexity in this bill, no doubt there will be many unintended consequences which could negatively affect the charitable sector. In fact, despite these extensive categories and definitions, the government has somehow managed to leave out 'housing' as a defined charitable purpose. I understand that stakeholders in the housing sector are therefore concerned about whether there is the potential to jeopardise future investment in public-private partnerships in that area.

The coalition believes that there is no significant reason that the government has outlined as to how the common-law definition of charity and charitable purpose is deficient. Therefore, Australia should maintain the definition of charity and charitable purpose which has been determined based on over 400 years of common law. This reflects the general conception developed over time of charitable purposes, rather than draconian definitions, categories and public interest tests of charity and charitable purposes, as proposed by this government.

There are over 600,000 not-for-profit entities in Australia, including approximately 56,000 charities. The government should be supporting the volunteering, charity and not-for-profit sector in this country as best it can. Instead, for years this Labor government has failed to provide certainty with regard to the obligations and responsibilities of organisations and of those governing these organisations. In 2011, the Labor government changed occupational health and safety laws, which effectively turned volunteers into workers, leaving community groups burdened with strict regulations accompanied by harsh punishments for noncompliance. Last year—in 2012—the government created the Australian Charities and Not-for-profits Commission, or ACNC, which, as I noted at the time, would increase red tape and increase compliance costs for the sector.

A fundamental value is the independence of the charities. Their ability to organise their structure and governance to suit their own activities should not be compromised by prescriptive and unnecessary standards. The coalition believes a one-size-fits-all approach to every charity and not-for-profit, which this Labor government continues to advocate, will decrease versatility within the sector. Once the ACNC comes into effect on 1 January 2014, these bills today may result in further transitional costs for some entities. I understand that there are concerns in the community about the conduct of some organisations to which they donate their money, but the government has not addressed those concerns in continuing to apply burdensome regulation to each and every charitable and not-for-profit organisation.

The coalition does have a plan to assist Australians effectively in this area. The shadow minister for families, housing and human services, the member for Menzies, has reaffirmed the coalition's commitment to reduce red tape for the charities and not-for-profit sector. A coalition government will shift the focus of the new Australian Charities and Not-for-Profits Commission away from endless compliance and regulation to a smaller body that encourages innovation, education and best practice in the sector. This could entail a small, independent charities commission, which would serve as an educative and training body for the sector. Such a commission would indeed support the sector by providing information about the process of registration for new organisations, it would advocate for the rights of these organisations and, further, it would help facilitate the interaction between government and the charitable and not-for-profit sector. This type of coordination is what the coalition supports: real on-the-ground support for community organisations rather than a centralised government legislating the definition of charity and charitable purposes and introducing burdensome reporting and conduct requirements for charities.

Members should resist any push that proposes a 'government knows best' view and, indeed, any push that centralises functions of government to the Commonwealth where there is no rational basis to do so. Indeed, in this case, the government has not outlined why there is an urgent reason for implementing a statutory definition of charity and charitable purposes at this time. We must respect personal and community responsibility, which we see so often in the charity and not-for-profit sector. We know that by fostering community spirit we reduce reliance on government. I do not believe that implementing a statutory definition of charity and charitable purposes enhances these values. If elected, the coalition will repeal this bill.