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Tuesday, 18 June 2013
Page: 6057


Mr EWEN JONES (Herbert) (13:27): I rise to speak on the Charities Bill 2013 and the Charities (Consequential Amendments and Transitional Provisions Bill) 2013, and much like the member for Tangney, who spoke before me, but with a slightly less eloquent flavour. I come to this from a very pragmatic point of view.

If you are talking about charities and about helping people, it should be about getting the dollars to the pointy end. It should be about how we maximise getting the dollars to the pointy end. I was speaking to Bruce Harmer from the Salvation Army in Townsville. They are very proud of the fact that 81.5 per cent of every dollar—81.5c of every dollar—that goes to the Salvation Army goes to front-line services. That means that only 18½c in the dollar goes to admin and all the costs. That, surely, should be our model. That, surely, should be what we as a parliament and as a society are trying to achieve. They are very proud that nearly 20 per cent of their money does not go to the back end, but goes to everyone.

This bill seems to be more about setting up a system. When you are thinking about systems the first thing that comes out of a system is to find a way around it. By way of explaining my position on that, can I go back to my banking days when I was in the credit card department of the Bank of New South Wales and Westpac. We used to let the branches decide who would get credit cards approved. We had a problem when the credit cards first came out because , if someone had money on term deposit, we automatically sent them a credit card—a Bankcard. But as we went through the eighties and credit card legislation started to come in, we came up with a system where the bank manager would sit there and say: 'What's your job? What are your prospects of making a repayment? How much is this actually going to mean?' And then he would sign off and approve it.

When banks became very aggressive in chasing market share, Westpac came up with a system called 'credit scoring'. With credit scoring the branch could still say yes or no, but if the branch said no we would take the decision out of the branch's hands and hand it to our credit-scoring system. It went on the length of time at your address, the length of your time in employment and all those technical things that would gloss over it. So the branch where the people were actually known could no longer say no. It came down to that.

At that time I was in credit cards. We used to call them 'wild cards', where people would get a credit card and rack up debts. It was before the magnetic strip, before you could get it all done, and they would have to ring up for authorisation, so if you knew what you were doing you could go. We had this bloke from Cooktown who got a new Mastercard. He had had the Mastercard for three days, he had a $2,000 limit and he was up to 6½ thousand dollars by then. So the first thing you do is try the work and home phone numbers. He did not have either. So you go and pull out the application. I rang the branch to complain about who the hell approved that application. They said, 'We didn't approve it, you guys approved it.' For your edification, Mr Deputy Speaker, can I walk you through the application and why this thing went through. Occupation? Unemployed. How long had he held that job? He had held that job for 32 years. Address? Care of the Lions Den Hotel in Cooktown—where every other hobo and desperate in the world gets his mail collected. How long have you been at that address? Twenty-five years. He got a credit score of 29 points. Someone like Kerry Packer would get a credit score of 30 points. So you would have this system where, if the information is put in incorrectly, all common sense goes out the window. That seems to me to be what is going on here.

We first went to common law for our definition of charities in the 1600s. We have had that definition for 400 years and it has worked. Tell me where it hasn't? I think that before we change things it should be demonstrated where the system is going so terribly wrong. That is what we have to get right—what is going wrong in the first place? Don't just see something and say, 'Hey, we can change that,' because as soon as you get a system there will be people who will find a way around it. Yes, there are people in our charities and not-for-profits who abuse the system and abuse their status, but this is not the way around it. The police are the way around that, and that means working with state governments, but this government would know nothing about working with state governments. What we should be doing as a parliament is speaking to our charities and not-for-profits about how they can get more dollars to the pointy end. What we should be doing as a parliament is getting rid of paperwork, not loading people up with it.

I will briefly go to the ACNC legislation, which we have said we will repeal. I am 100 per cent in lockstep on this with Kevin Andrews, the shadow minister, who will be the minister should we be fortunate enough to win the next election. When I had the shadow minister in Townsville we spoke to an aged-care facility. They have a facility in Townsville and there were two failing facilities, one in Ayre and one in Ingham. Ayre is 85 kilometres south of Townsville and Ingham is about 115 kilometres north of Townsville. Administratively, they were just getting killed, it just got too hard. So the Townsville operation said: 'We'll take you over. We'll do your paperwork centrally here, spreading the costs, so that you can provide the information and you can still do the services.' They sent their forms, the reports they have to do, to the government. The government came back and said, 'There are three organisations here.' They said, 'Yes, there are three organisations here, but we are doing the central thing here.' The government said, 'No, you have to do that report three times.' They said the report would be exactly the same. 'It doesn't matter,' was the reply from the Public Service, 'it simply has to be done.'

First and foremost, all this paperwork for these people is just loading them up. They know we are not reading it; they know the Public Service simply cannot get through all these forms. There are spot checks done. Aren't we better off saying to charities and not-for-profits: 'Listen, we are going to come down hard on those people that we think are doing the wrong thing. We are going to use the police and, as a federal parliament, we are going to work hard in cooperation with the states. We are going to have a look at taxation, we are going to do all these things and we are going to come down hard on those people'? That is better than going around and completely vilifying the whole organisation and then going and changing things.

Can I just say for the record that the coalition is committed to retaining the common law definition of charity. We have made this commitment on the basis that the government has not made out the case for the common law definition being deficient and that to change the current definition risks disadvantaging some charities and creating a new wave of legal disputes and test cases at a great cost to the sector. I think that is a fair statement. I think when a government are trying to make their case they should, in fact, make their case. If this was being driven by the charities and not-for-profit sector then I would understand it a little bit more, but it is not. It is not being driven by anyone I am speaking to in the charities and not-for-profit sector. As a matter of fact, they are running as far away from this as they possibly can. The shadow minister has said:

Stakeholders in the housing sector are particularly concerned that housing has not been listed as a defined charitable purpose and believe this has the potential to jeopardise future investment in public-private partnerships. They have stated that they will be more disadvantaged under the statutory definition than the current common law definition and have called for the bill to be amended to provide further clarification with regard to the treatment of housing as a charitable purpose.

Using that as an example, does this just become like the Family Law Act or the Child Support Act and we have amendments? You cannot amend it every time for every single thing, so then we will have cracks through which people fall. Aren't we better off concentrating on what we have and fixing the very real things that this government has got broken, fixing the very real things that are in front of this parliament that could be fixed, instead of going around and hunting for things that could be done? The list of stakeholders is just phenomenal. I will also read for the record here from a speech delivered by shadow minister Kevin Andrews where he said:

Former Prime Minister John Howard announced an inquiry into the definition of charity on 18 September 2000. The inquiry reported in 2001, making some 27 recommendations.

Former Treasurer Costello released draft legislation in 2003 which took the traditional four heads of charity and divided them into seven heads of charity in line with the inquiry's findings.

So they have gone out and consulted, then he came back and released proposed legislation for discussion in line with the inquiry findings—

namely, the advancement of health, education, social or community welfare, religion, culture, natural environment and any other purpose that is beneficial to the community.

The Board of Taxation reported on the workability of the draft legislation in 2004—

so, again, it has taken some time because you want to get it right. And, as Kevin Andrews went on to say:

The then government through the then Treasurer announced:

… the common law meaning of a charity will continue to apply, but the definition will be extended to include certain child care and self-help groups, and closed or contemplative religious orders. The government has decided not to proceed with the draft Charities Bill. The former coalition enacted the Extension of Charitable Purpose Act which confined itself to enlarging the legal definition of charity for federal purposes to include child care, self-help groups and closed orders. The Commonwealth's definitional extension has not been adopted by any state jurisdiction.

This bill would be the first time that legislation has sought to comprehensively define in statute, for the purposes of Commonwealth law, charity …

and here is the rub—

why create a statute where the common law has and does serve us well?

I think the onus is upon the government to prove that case beyond all reasonable doubt.

Why depart from 400 years of clarity and consistency?

There is no logical reason.

As an aside, every member in this House had the Oaktree Foundation come through to us about increasing our foreign aid to 0.5 per cent of GDP. It is a worthy goal. But when those guys sat down next to me, I said: 'Do you know what you are actually chasing? Are you chasing more money going into the system, or are you chasing a better result?' They are not the same. Some of the money we send overseas has as little as 16c in the dollar getting to the pointy end. So I said, 'Aren't we better off working with the money we have to get a better result on the ground?' Aren't we better off trying to raise that 16c to get to the Salvation Army's 81½c? Isn't that the goal—to make people better off? If someone could tell me how this place and this bill are going to make all the charity sector and all the not-for-profit sector and all the churches better off, I will be available for that meeting.

This just puts another border around which someone must work. This is just giving work to solicitors to come up with those sorts of things. It lets governments of whatever persuasion pick on someone and say, 'You do not quite fit that so out you go.' We are running a real risk with this, because we have a great number of things which must be done by this parliament.

I do not think that this is one of the things that we should be concentrating on. We should be concentrating on the things that make people's lives better. I want to see a bill in this place about homelessness. I want to see a bill in this place about doing all sorts of good things. This sort of mucking around with definitions and regulation for regulation sake does not do anyone in here any good. You are alienating an entire sector of the community. If this does go through, we will repeal it, and I am calling on all the charities and not-for-profits to make sure that their position is known to every Labor member and every Labor candidate and that what this government has done: load up red tape on this sector. We should be getting rid of red tape. Our aspiration should be at least the Salvation Army's 81½c in every dollar going to the front line of services. This bill is absolute rubbish and we should vote against it. I thank the House.