Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Hansard source

I move:

That all words after “That” be omitted with a view to substituting the following words:

“whilst not declining to give the bill a second reading, the House is of the opinion that the Government’s plan to abolish the Australian Charities and Not-for-profits Commission is an insult to the good work of the charitable sector, and to all Australians that want accountability and transparency when it comes to their generous donations.”

Let me start with a story of great concern. It is about some scammers who set up charities with names such as Friends of the Disabled Children's Task Force, Friends of the Underprivileged Children's Task Force, and Chronic Constructive Pulmonary Disease of Australia Incorporated. Australians, inspired by a deep sense of generosity, donated more than $1 million to them. It turned out that there was not much evidence of the money going to the disadvantaged or needy, and those charities have now been shut down.

All scammers are dodgy, but I have always regarded charity scammers as a particular form of low life. Other scammers exploit greed or lust or ignorance, but charity scammers prey on our goodwill; they take that great Aussie tradition of wanting to help the vulnerable, and they use it to line their own pockets. Cracking down on scams was one of the main reasons Labor set up the Australian Charities and Not-for-profits Commission in 2012. Before we established the commission, Australians had no central register to find out whether a charity was dodgy or legit. Now if someone comes to your door asking for money, you can jump onto www.acsnc.gov.au and check them in an instant. And the charities commission is proactive when it comes to dealing with scammers. Earlier this year it deregistered two Western Australian groups after a five-month investigation showed that their 'benevolent' work was a sham.

The work of the Australian Charities and Not-for-profits Commission in cracking down on scammers has been first-rate. They received over 200 complaints in their first year, including 48 for fraud or criminal activity. Cracking down on scammers is absolutely vital, because, if we do not, we not only hurt those who donate but also sap the goodwill of others who might donate to a good charity but are too concerned that it might be dodgy.

Charities are fundamental to the Australian way of life. Charities in the not-for-profit sector employ more than one million Australians, generate almost five per cent of GDP and turn over about $1 billion a year. As David Crosbie has put it:

The ACNC is important to how charities do business, yet the government chooses to ignore the majority of charities in deciding what it will do.

Since its inception, the charities commission has seen more than one million hits on www.acnc.gov.au. According to their six-month report, average registration time for charities was 11.4 days. In the first six months they had answered 14,500 phone calls, responded to 6,900 written inquiries and registered 500 new charities. The benchmark for the charities commission and the tax office to decide on tax concession status was 85 per cent within 28 days, but the charities commission has significantly exceeded that, reaching a level of 95.6 per cent of charities whose tax status had been determined within 28 days. As David Crosbie notes:

The ACNC is more efficient than the government regulators it replaced, is doing good work and deserves a chance to achieve its three goals of reducing red tape, increasing public trust and strengthening the charities sector.

In the case of Indigenous charities, the charities commission is playing a particularly important role. The ACNC employs two Aboriginal liaison officers to provide assistance to customers of Aboriginal and Torres Strait Islander descent who might prefer to liaise with staff from an Aboriginal background. Axing the ACNC would hurt Indigenous charities.

The charities commission has launched the Charity Passport, a secure online system to save charities from reporting the same information to multiple government agencies. As ACNC commissioner Susan Pascoe, about whom no-one seems to have a bad word—even those who want to scrap the charities commission—has noted:

A single charity that conducts fundraising across the country, and receives government grants, may need to report to more than 10 different government agencies.

The Charity Passport is the key to the ACNC’s ‘report once, use often’ framework, cutting down the amount of time charities spend on duplicative reporting to government.

Through the passport, we can securely share information the ACNC collects from registered charities with authorised government agencies.

The Charity Passport has been tested by two government agencies, and the charities commission is encouraging more government departments to sign up. The Charity Passport is being deployed in two phases: the first using a file transfer protocol repository; and the second phase, scheduled for implementation around now, involving integration with agencies' IT systems.

The history of the charities commission is a long one. There were external inquiries encouraging the federal government to set up something akin to the charities commission in 1995, 2001 and 2010. There have been parliamentary committee reviews, issues and discussion papers, exposure drafts and consultations with experts. Indeed, the Australian Taxation Office, in a submission to a parliamentary inquiry as far back as 2001, said as follows:

It is also our view that administration would be better served by a single independent common point of decision making on definitions leading to conclusions about whether organisations are charitable or non-profit, such as occurs with the Charity Commission in the UK, for example.

A bipartisan parliamentary report in 2006 by the House of Representatives Committee on Legal and Constitutional Affairs recommended:

The Committee recommends that the Australian Government, in consultation with the not-for-profit sector and the States and Territories:

That is a House of Representatives committee report commissioned by the member for Berowra. It was a bipartisan committee report, and one of those who signed off on it was the shadow Prime Minister—sorry, the Prime Minister's shadow—the member for Wentworth. The member for Wentworth then thought that the charities commission was a very good idea, as every sensible contribution in this sector does.

The Productivity Commission inquiry, chaired by Robert Fitzgerald, who I will refer to later, said:

Corporate Australia long ago rejected such a regime and begs the question as to why the not -for -profit sector should be burdened by such a cumbersome regime?

In the process of bringing the ACNC into being, Labor's shadow Treasurers, including the now Leader of the Opposition and the then member for Lindsay, David Bradbury, engaged extensively with stakeholders and addressed those stakeholders' concerns systematically.

Where religious institutions were concerned about the impact on small parishes who had few personnel and little income, it was addressed by providing a financial and governance exemption for basic religious charities. Where schools wanted to ensure that they would not have to report twice to the charities commission, this was addressed through an agreement that avoided duplicate reporting. Charities incorporated as companies limited by guarantee wanted to ensure that they did not have to annually report to both ASIC and the ACNC, so the arrangement to report once was put in place. Certain philanthropic funds did not want their details published to avoid unsolicited requests, so the commissioner exercised her discretion to ensure that nondisclosure of key information can occur. Information provided by Indigenous organisations to the Office of the Registrar of Aboriginal Corporations is sufficient for ACNC services.

So the process of setting up the charities commission was a highly consultative one—one which involved a great degree of engagement with the charitable sector. This stands in stark contrast to the lack of consultation from this government. It has to be said that the government is not moving quickly on this bill. By my count, it has been over 253 days since the minister gave his speech attempting to scrap the charities commission. In that 250 days, the minister has engaged in frighteningly little consultation with the sector.

The Department of Social Services was asked in the Senate estimates committee who it had consulted with over the charities commission repeal. It named a number of bodies. One of these was the Governance Institute of Australia. They were a bit surprised that the minister had been suggesting that he had consulted with them. They said, in their letter dated 30 May 2014:

This is misleading. Governance Institute has not at any time been consulted by the Department of Social Services. A representative of Governance Institute attended a forum organised by Melbourne Law School had which staff members representing the Department of Social Services were also present.

That is their idea of consultation: 'We were in the same room as you, so we consulted you.' That is not consultation. Justice Connect wrote in similar terms:

We were surprised and concerned to see the name of our organisation, Justice Connect, on a list of 'organisations DSS had consulted about the ACNC'.

We understand that we were listed by the DSS because a representative from our organisation attended a Melbourne Law School event on the future of charity regulation, which was also attended by DSS representatives and Minister Andrews' adviser.

Let us be clear, the minister was not in the room. His adviser was in the room. And they call that consultation! Justice Connect said:

We therefore request that the record be corrected to indicate that we have not been consulted, despite specifically requesting this opportunity.

So the minister is rejecting attempts by worthy organisations to consult and is then going away and telling the Senate that he has consulted with them. Part of the failure to consult occurs because the charities commission issue has not been placed in the hands of the Assistant Treasurer—of course, the government does not have an Assistant Treasurer—it has been placed in the hands of Minister Andrews. As John Butcher from the University of Canberra puts it: 'Thus far the field appears to have been abandoned to ideological considerations and, seemingly, the privileged voices of a small number of organisations that have the ear of Minister Andrews.'

I turn now to the support that the charities commission enjoys within the sector. The 2014 Pro Bono Australia State of the Not for Profit Sector Survey found that four out of five not-for-profits stated that the charities commission was important to a thriving charities sector. Only six per cent agreed with Minister Andrews that the charities commission should be scrapped and responsibility for regulating charities returned to the tax office. Even the National Party gets more support than that. Indeed, the Pro Bono survey was conducted in both 2013, before the election, and 2014, after the election. So, after trolling the country—

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