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Tuesday, 11 September 2012
Page: 10277


Ms SAFFIN ( Page ) ( 21:13 ): I rise to speak in support of the Australian Charities and Not-for-profits Commission Bill 2012 and the Australian Charities and Not-for-profits (Consequential and Transitional) Bill 2012, referred to as bills one and two. The not-for-profit sector—or the NGO sector, as it is commonly known—is a sector I am very familiar with. It is a sector I worked in for a long time—and the Minister for Health is nodding her head, because she did as well. We have history going back a long time of working in that sector, understanding that sector and knowing it.

In its development the sector has not had an appropriate regulatory framework to give it the protection and the status and all the other things that it needs. We have heard a lot in here tonight about the number of inquiries that have taken place on the not-for-profit sector—three substantial inquiries over about 17 years. I think that everybody has thrown their hands up and said: 'It's too hard. We won’t deal with this; it's just too hard,' but everybody knows that change has to happen. It is time to say: 'We're going to start. We're going to do it, and we'll do it now.' There will be a transition period where some things develop which we know will need to be changed. There is a five-year review built into the legislation, and, even before the five-year formal legislative review, there will be ongoing review. The minister, the government and everybody associated with the bill have made this fact clear. But introducing change can disturb people. The not-for-profit and NGO sector is broad, and trying to make sure that absolutely everybody who runs a not-for-profit knows every detail about it is a challenging task. The ACNC task force was set up to make sure of this. It did some consultation, and I have been doing some consultation myself locally, giving information to people and trying to assure them that this legislation is being done for them rather than to them, because often the two things can be confused.

I said that there have been three separate reviews over the last 17 years of the charitable and not-for-profit sector; I meant that there have been six. However, the three reviews that I was referring to were the 2001 report of the inquiry into the definition of charities and related organisations, which is always a rather vexing issue; the 2009 review into Australia's future tax system; and the Productivity Commission's 2010 report Contribution of the Not-for-Profit Sector. All these reviews have recommended the same thing, as did the reviews over the last 17 years that preceded these three. They have recommended simplifying and harmonising taxation and regulation of the sector. They have all recommended without hesitation or any caveats a national regulator, a statutory definition of a charity and the modernisation of the sector.

I listened to the contribution of the honourable member for Wright, and I agree that we need to let civil society do the work it does and does well and not interfere in it. But the sector also needs some changes, and that is what these bills aim to achieve. I also heard the member talk about directors' liabilities, and I turn now to talk about the liabilities of people who run not-for-profits, charities and NGOs. When I worked in the not-for-profit sector I used to do workshops, seminars and roundtables on people's liabilities and responsibilities. One thing I used to say was that, within the sector, you can be a tiny little charity organisation doing some really good work at a very local level and in a very specific area and attract almost the same fiduciary duties and responsibilities as companies such as BHP. Over the years, with the common law and corporations law, even though they might have been registered under the associations incorporation acts at their respective state levels, they attracted such responsibilities and liabilities. That is of the things that the reviews over the past 17 years have been trying to deal with. I can remember one of the cases, though I forget the case reference now. It was a case involving the Victorian division of the National Safety Council. They had a voluntary board and they were doing their charitable work. They also had people who worked for them and a CEO, and the case had to do with fraudulent activity. The chairman of the board ended up with a judgement against him for a huge amount of money. The case went behind the corporate veil, and he had to pay back a lot of money. Cases such as this are of real concern in the charitable sector. I will always remember that case. I am not going to mention the name of the chairman of the board there, but it was probably a terrible shock to him because he was doing good and doing it voluntarily, and he ended up with huge liabilities in the judgement against him. I used to do my workshops and seminars and roundtables on this case in order to try to communicate to people the sorts of things that they needed to do protect themselves.

I am not saying that these bills are about the same thing, but the whole focus is on saying that the sector is different to and separate from big corporations and that it needs its own regulatory framework. I am pleased that the government has embarked on providing the sector with its own regulatory framework instead of saying, as everybody has said after the six separate reviews of the charitable and not-for-profit sector, 'It's just too hard; we won't do it.' Reform has to start somewhere.

I will outline briefly the Australian Charities and Not-for-profits Commission Bill 2012 and the Australian Charities and Not-for-profits Commission (Consequential and Transitional) Bill 2012. In the 2011-12 budget, the government announced that it would establish the Australian Charities and Not-for-profits Commission as a national regulator.

Initially only tax endorsed charities will be regulated by the ACNC, but the bill establishes a framework that can be extended to all not-for-profit entities in the future. That is a good thing, because it gives a transition; it gives people time.

The main bill establishes the ACNC. It charges the ACNC with registering not-for-profit entities and maintaining a public register. It provides for the powers of the ACNC commissioner in the regulation of registered entities. It establishes a single national regulatory framework for not-for-profit entities and sets out the obligations and responsibilities of registered entities.

The second bill contains amendments to Commonwealth legislation resulting from the establishment of the ACNC, giving operational effect to the main bill. It makes ACNC registration a precondition for charities to access certain Commonwealth tax concessions as well as a number of other Commonwealth concessions, benefits and exemptions. It contains transitional provisions to allow registered entities time to transition smoothly from the currently regulatory framework into the new ACNC regulatory framework.

I have had discussions with local charities and made direct representations to the minister about some of the things the local people have said. I have invited the minister to come and talk with some of my local groups and he has accepted that invitation. I will have a round table in my seat of Page and invite members of the not-for-profit sector along so they can sit around the table and have a conversation with me and the minister about the implementation of the bills.

I have also had discussions with the Catholic Diocese of Lismore. It covers a broad area, larger than just the city of Lismore, my home town. They have raised with me some issues relating to implementation. They support the thrust of the bill, with the single national regulator and the regulatory framework, and they want to be assured that there will be a reduction in red tape. They want assurance that the reports they currently make under certain acts, particularly under the Schools Assistance Act, can be deemed to be reports that will satisfy the new national regulator. I agree with that; it is just common sense. That is clearly what we need to do if we are to reduce red tape. They also want assurance that certain entities will continue to have the basic religious charity status that operates now. I also support that and have had discussions with the minister about it. In relation to the ACNC register, we have to make sure that due process and natural justice are followed before people can give warnings and directions. I am assured that that will be the case. I have copies of submissions from the local Lismore diocese which I have put before the minister. It is clear that these bills form a large part of the government's reform agenda in the not-for-profit sector.

Over the years, I have taken up the issue of DGR status, which comes through the ATO. I have written many submissions and helped organisations to get DGR status. It is not always easy to get DGR status. Yes, there is law and, yes, there is a form one follows. I have found it easy to write the submissions as long as you have the corporate entity that satisfies the legal requirements. But sometimes people are puzzled and ask, 'Why do they get it but we don't?' That is an issue I have been working on with neighbourhood centres and learning centres. I have been advocating for that to be clearer, and I think everyone would agree with me on that. This is an issue that I am passionate about, and I hope to see some changes in this area.

I support the bills, noting some issues of caveat. I commend the bills to the House.