Kevin Andrews (Menzies, Liberal Party, Shadow Minister for Families, Housing and Human Services) Share this | Link to this | Hansard source

I rise to speak on the Charities Bill 2013 and the Charities (Consequential Amendments and Transitional Provisions) Bill 2013. I will focus my remarks primarily on the Charities Bill. That bill seeks to introduce a definition of 'charity' and 'charitable purpose'. The new definition would apply from 1 January 2014, and would apply across all Commonwealth legislation. This is a bad bill; this is an unnecessary bill.

Since Federation, the definition of 'charity' has remained clear and consistent. It has remained a cornerstone of the underpinning of what constitutes charitable endeavour and what constitutes charitable activity. The definition has survived for over 400 years. It is based on a legal concept from the early 1600s. It is widely understood, and it is unilaterally accepted. But now the definition that has served us so well is in this government's firing line.

The government wants to abandon what works, what is proven and what is broadly accepted by our society, and replace it with its own definition. Australian charities law has closely followed the definition of 'charity' based on the preamble of the Statute of Elizabeth. English common law is the principal basis for charity laws in Australia in both state and federal courts, and each of the state jurisdictions have retained almost identical interpretations of the common law definition of charity.

The government is now seeking to pretend that there is some desperate need to legislate in this area, acting as though it is charting new waters. The reality is that it was the former Howard government that looked at the issue of the common-law definition of charity. Former Prime Minister 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 inquiries findings—namely, the advancement of health, education, social or community welfare, religion, culture, natural environment and any other purpose that has been official to the community.

The Board of Taxation reported on the workability of the draft legislation in 2004 and 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 government enacted the Extension of Charitable Purposes Act 2004 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. Our concern is clear: why create a statute where the common law has and does serve us well? Why depart from 400 years of clarity and consistency?

The coalition's approach to charities is different from that of the government. Labor prefers intervention and approaches the sector with distrust demanding huge amounts of information, draconian reporting requirements and making it tough for volunteers and the charities they support to go about their important work. This is a philosophical divide best highlighted by looking at the opening words of the maiden speech of the former Prime Minister Mr Rudd:

Politics is about power. It is about the power of the state. It is about the power of the state as applied to individuals, the society in which they live and the economy in which they work.

The other approach is about empowering people, not exercising power over them. It is the approach that the Leader of the Opposition utilised when he referred to Abraham Lincoln's famous description of democracy as, 'of the people, by the people, for the people'.

The coalition has confidence in civil society. We believe that the political community should serve civil society, not the other way around. The coalition will oppose this bill and, if elected to government later this year, we will seek to repeal it.

Gai Brodtmann (Canberra, Australian Labor Party) Share this | Link to this | Hansard source

These bills form part of a much needed and long-overdue reform of the not-for-profit sector in Australia. I am pleased to be part of a government that is making these necessary reforms and I know that the not-for-profit organisations in my electorate of Canberra will be better off because of them.

The cost of the regulatory burden placed on not-for-profit organisations is an issue often raised with me when I am out speaking with representatives from the not-for-profit sector in Canberra. For example, at the Winnunga Nimmityjah Aboriginal Health Service in Narrabundah they have had to employ a full-time administrative staff member just to manage these regulatory requirements. Essentially, that means that they have had to employ someone who works every day of the year—except the holidays—just to work on filling out paperwork and managing the regulatory requirements. For community based organisations such as Winnunga, which see on average 3,000 patients per year with a growth rate of about 80 new patients per month, there are certainly better uses for their limited resources than administration.

The government's reforms are designed to help organisations such as Winnunga to ensure that they can focus on the important work they do in our communities, not on regulation. The reforms implemented by this government cover three key areas. The first area of reform is regulatory reform, including establishing the Australian Charities and Not-for-profits Commission and introducing a new statutory definition of charity. The second area of reform is tax reform, including reforming the regulation and taxation of the not-for-profit sector. The third area of reform is funding reform, including streamlining government funding agreements and reporting requirements. This is particularly important because I am all for transparency. We need accountability, we need transparency and we need to understand where federal, state and territory money is going in terms of these not-for-profit organisations, but we do not want to make the regulation burden onerous.

The government is also working with state and territory governments to reduce the regulatory burden on the sector through COAG. This work includes: considering the application of the Commonwealth statutory definition of charity, which we are debating tonight, for states and territories; developing a nationally consistent approach to fundraising regulation; harmonising the definition of which activities conducted by charities will be considered non-charitable; and reviewing governance and reporting requirements for the not-for-profit sector. All of these reforms seek to reduce the regulatory burden on the operations of not-for-profit organisations allowing them more resources to carry out the good work they do—the great work they do—to focus on core business.

Perhaps the most significant part of this reform process so far has been the establishment of the Australian Charities and Not-for-profits Commission. The commission was established as the first independent national regulator of charities in Australia and the commission was intended to maintain, protect and enhance public trust and confidence in the not-for-profit sector through increased accountability and transparency; and to provide support to the sector to ensure that it remains robust, vibrant, independent and innovative.

The commission began operations on 3 December last year and it is already working hard to achieve a reduction in unnecessary regulatory obligations for the sector. On a practical level, the commission registers organisations as charities. It helps charities understand and meet their obligations through information, guidance, advice and other support. It maintains a free and searchable public register so that anyone can look up information about registered charities. It works with the state and territory governments as well as individual federal, state and territory government agencies to develop a 'report once, use often' reporting framework for charities. The 'report once, use often' framework is just so important because it will allow charities to report once to the commission and allow authorised government agencies to then access this information, thereby eliminating the need for charities to report the same information to different government agencies.

Maria Vamvakinou (Calwell, Australian Labor Party) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 34. The debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting. The member will have leave to continue speaking when the debate is resumed.