Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Minister for Treasury) Share this | Link to this | Hansard source

I move:

That this House:

(1) notes that:

(a) charities are the most trusted sector in Australian public life; and

(b) the Government's failure to act on fundraising reform is costing Australian charities over $1 million every month;

(2) acknowledges that:

(a) Australia's current framework of fundraising regulation creates unnecessary problems for charities and organisations who rely on donations from Australian supporters;

(b) current fundraising laws no longer meet the objectives that guided the decision to regulate donations;

(c) current fundraising compliance regimes do not allow charities to cultivate donor activity and make optimal use of the resources donors provide;

(d) meeting the requirements of Australia's seven different fundraising regimes is causing needless productivity loss for thousands of Australian charities and not-for-profits;

(e) Australia's current frameworks for investigation and enforcement have failed to adapt to the contemporary fundraising environment;

(f) current fundraising laws do not meet the donor-focused expectations and requirements that should govern fundraising regulation in the 21st century; and

(g) the mechanisms that regulate third party fundraisers should ensure the culture of third party fundraisers matches community perceptions of their clients;

(3) recognises that:

(a) for several years, the charity and not-for-profit sector has been calling for reform of Australia's fundraising laws;

(b) Treasury's five year review of the Australian Charities and Not-for-profits Commission, delivered on 31 May 2018, identified fundraising law as the major reporting burden on charities and recommended that fundraising law be harmonised across the country;

(c) in February 2019, the Senate Select Committee into Charitable Fundraising in the 21st Century called on Parliament to harmonise fundraising law within two years;

(d) that inquiry, chaired by Labor Senator Catryna Bilyk, delivered a unanimous report, with its recommendations being supported by Greens Senator Rachel Siewert, Liberal Senators Eric Abetz and Amanda Stoker, former Labor Senator David Smith, and former United Australia Party Senator Brian Burston; and

(e) postponing fundraising reform has had significant costs to the charity and not-for profit sector, with the committee estimating that the annual cost to charities and their donors is around $15 million; and

(4) calls on the Government to:

(a) support Australian charities by ending unnecessary waste of their precious resources;

(b) support the generous Australian donors who donate money to our charities, by ensuring their donations are not needlessly eroded by redundant administrative and regulatory costs;

(c) work with state and territory governments and the not-for-profit sector to deliver a consistent national model for regulating not-for-profit and charitable fundraising activities before February 2021; and

(d) immediately provide a public response to the recommendations made in the review panel's report, Strengthening for Purpose: Australian Charities and Not-for-profits Commission Legislation Review, which was provided to the Government on 31 May 2018.

Australian charities are facing a perfect storm. Hundreds of thousands of workers could lose their jobs from the charities sector if something isn't done soon according to a new report from Social Ventures Australia and the Centre for Social Impact. It found that a 20 per cent fall in revenue for the sector would see as many as one in six charities at high risk of closing down, and a quarter of a million charity workers out of a job. We often forget the charity and not-for-profit sector accounts for one-tenth of the economy. A significant number of Australians are employed in the charity sector, and yet the charity sector has, at the same time as it has seen massively increased demand for its help, experienced a huge drop in donations and volunteers. Seventy-eight per cent of charities have reported a downturn in revenue, and a survey found that two-thirds of volunteers had been forced to cut back on their volunteering activities. Charities are the safety net for people who fall through the cracks, and yet the government's JobKeeper program will only assist one in 13 charities.

But there are other ways in which the government could help this most trusted sector. One of those is to reform Australia's outdated patchwork of fundraising laws. This is not a new issue. The Treasury's five-year review of the charities commission, delivered in mid-2018, identified fundraising law as a major reporting burden on charities, and recommended that fundraising be harmonised across the country. The government's failure to act on fundraising laws is costing Australian charities over $1 million a month. Charities are the most trusted sector of Australian public life, and yet our current framework of fundraising regulations requires charities to register with seven different fundraising regimes. It's a needless productivity drag on a sector which is more crucial than ever, because it's having to comply with fundraising laws that are barely fit for the 19th century, let alone the 20th.

The Senate committee looking into charity fundraising, ably chaired by Labor's Senator Catryna Bilyk, unanimously recommended the harmonisation of fundraising be done by February 2019. As I said, that was a unanimous report by not only Senator Bilyk but also Greens senator Rachel Siewert, Liberal senators Eric Abetz and Amanda Stoker, former Labor senator David Smith, and former United Australia Party senator Brian Burston. That report noted the huge cost of failing to act on fundraising, which it estimated to be around $15 million a year, and called on the federal government to lead a process working with states and territories to deliver a nationally consistent model for regulating fundraising activities before February 2021.

Charities have pointed to some of the specific problems. Nell Anderson from the Cova Project, an Australian charity that provides safe sanitary care to women in developing communities across Africa says that, due to the shift to online marketing and fundraising, the charity needs to obtain licences around Australia: 'We have only one employee, and it's a waste of her time and effort, and of precious money.' Paul Burke, Treasurer of the Whitsunday Suicide Prevention Network, says that the process of applying for charity registration is 'hopelessly out of date'. A charity worker who sells products with charity logos describes Australia's fundraising laws as 'an absolute nightmare'. Another charity says, 'As a charity registered nationally with the ACNC, in the digital era it is difficult to understand why a simple web page inviting online donations triggers a labyrinth of laws, many of which seem incredibly outdated.'

This motion was put on the Notice Paper last year—well ahead of coronavirus—and it called for the government to act by February 2021. But that is now, in my view, too late. The government should act much more speedily to reform Australia's fundraising laws. National Federation Reform Council meetings are now occurring fortnightly, so there is no reason why the issue cannot be taken up by the end of the financial year, with a clear directive to officials to begin work. A permanent solution could be in place before the Christmas giving season if appropriate priority were given to it now. It is the right time to help charities. If the government want to, as they put it, 'build back better' then this is a zero-cost way of removing the biggest administrative burden on the sector and helping Australia's charities and the millions of Australians who are helped by them.

Rick Wilson (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Is the motion seconded?

Josh Burns (Macnamara, Australian Labor Party) Share this | Link to this | Hansard source

The motion is seconded, and I reserve my right to speak.

John Alexander (Bennelong, Liberal Party) Share this | Link to this | Hansard source

Charities are an outward demonstration of the compassion in a society. No-one wants to rely on the charity of others, but when times get tough it is wonderful to know that there are selfless people out there offering a hand to those in need. And there have recently been more and more people who need that hand. The COVID pandemic has been accompanied by an economic downturn the like of which we haven't seen for over a decade. Indeed, judging by some of the metrics we are in an economic malaise worse than any since the Great Depression. As the queues snaked around the block outside Centrelink offices back in March, the number of people dependent not only on the government but on their family, neighbours and friends rose too.

With this need came the generosity of Australians to meet it. I have been fortunate to see this generosity personally. Early on in the health crisis, Parramatta Women's Shelter reached out to ask if they could use our offices as a drop-off point for food donations. I was more than happy to offer this, and over the past two months I've been absolutely astounded by the size and number of donations we've received from generous locals. When times get tough, it is abundantly clear that Australians don't leave people behind.

In Bennelong, we're so lucky to have a large number of wonderful charities that offer services and empathy across our community. They are doing extraordinary work but are stretched to their limit right now. As they have said to me, any new person they have to help is in addition to those they are already helping. The pie needs to be cut more finely, but the pie does not necessarily get bigger. That is why the government has needed to step up and help the sector, with fantastic news in the recent announcement of an additional $200 million as part of a new community support package to help vulnerable Australians who have been impacted by coronavirus. Bennelong has been fortunate enough to share in total additional funding of $959,000 over this year to support the work of these and other community organisations. The government is working closely with these groups, providing them with the additional support and finance they require to support our most vulnerable. Our excellent charities—including Christian Community Aid; North Ride Community Aid; and CatholicCare, Diocese of Broken Bay—are all receiving their share of this increase and using it to continue their wonderful work helping those who need it most.

I've also heard from Stryder, our wonderful local mobility volunteers, who are a critical service for sectors of the community that would otherwise not have the ability to get around. They have received word of a successful application for a 2020 Commonwealth volunteer grant. This will allow them to add to the generosity of their donors and, hopefully, grow their volunteer base. I'm looking forward to visiting these guys as soon as the COVID virus allows.

We really can't thank our local charities enough at this time. The work effort, dedication and resourcefulness that they have put into our communities are beyond what we could ever comprehend. Their successes are testament to the thousands of regular people in our community who are giving their time and care to those who desperately need help. We have strong communities that rally together in the face of an uncertain and dangerous future. It is because of our community spirit that we will endure this crisis and come out stronger on the other side. I often claim that Bennelong is the capital of innovation. We're also in the running for top orders for generosity and kindness.

Josh Burns (Macnamara, Australian Labor Party) Share this | Link to this | Hansard source

I'm very pleased to join the member for Fenner in his motion calling for more support for our not-for-profit and charity sector. In Australia we are so fortunate to have people who don't just think for themselves but act for others. Our not-for-profit and charity sector is a great source of pride. In many cases we wish we didn't need its work, but in so many ways I know that I, as a member of parliament, and many colleagues on all sides are inspired by the efforts of ordinary Australians going above and beyond, and a bit later I will share some of the experiences in my electorate.

I also want to note that before the last election I joined the member for Fenner just outside my electorate at the local organisation SANE—they do wonderful work supporting people, especially around mental health—for an announcement of all the different things we would be doing to support charities and not-for-profits. While we didn't get everything right at the last election, I think that policy was one thing that would have made a significant difference in the lives of people. It was a great day. Sadly, we didn't get to implement some of those things—alas!—but we continue working.

This sector is one that needs support, and never more than over the last few months in Australia. As the member for Fenner rightly pointed out, while demand has increased, support has decreased at a rapid rate. I think the best example I can think of locally is the outstanding Australian organisation OzHarvest. I was very pleased to have a conversation with its founder, Ronni Kahn, a few weeks ago, on one of the many webinar experiences that we all have been doing. She spoke about the need for food and the need for food for Australians, because many people are doing it tough and OzHarvest has never been needed more in Australia. Thankfully there had been support from some of the major supermarkets, but demand had never been higher. Unfortunately, people don't have as much to give right now, so every little bit that we can be doing in this place to support not-for-profits and charities to reduce their administrative burden and to reduce their own financial burden is absolutely crucial. It means more people get fed, it means more people get supported and it means more and more organisations like OzHarvest are able to do the things that they do best, which is support Australians.

There are other local organisations that I wanted to take note of. The first one is one that holds dear to my heart, which is the Father Bob Maguire Foundation, which is a foundation that literally looks after those people who don't have a voice and looks after the people who are forgotten. Bob is in his 80s at the moment, but he is still firing on all cylinders. He is still working tirelessly to support people in public housing in all different parts, vulnerable parts, of the community, and he does an outstanding job. We should be supporting organisations like Father Bob foundation to make sure that their administrative burden is reduced as much as possible.

I also want to note that the assistant minister for homelessness and housing came out and met with Father Bob before the coronavirus, and I was pleased to join him on that day. I would like the next visit to come with an announcement of support for the Father Bob foundation. I'd be, once again, pleased to stand with the assistant minister if he were to join me.

Of course there are so many other organisations that I could point to. Little Dreamers is one that blows my mind every time I speak to Maddy Buchner, who is the CEO. She is an absolute force and a leader to be reckoned with in the future. She is younger than me but she is far more impressive. She has created a whole organisation supporting carers of people—siblings who care for their sibling. It provides a whole range of support networks and support programs for people who are doing caring, unpaid caring and people who are often forgotten in this industry. She is just brilliant. I know that she is speaking to many people across all forms of government at the moment to try and secure her future. I wish her well and wish her our full support in the future of Little Dreamers.

This motion is a really important motion. It's a motion that says the government needs to act on the Senate committee's report and on their own review into the Charities Act. This is outdated legislation. For the party who likes to brag about reducing red tape, this is a great place to start. This is a great place to start, by supporting people who do incredible work supporting Australians. I wish there wasn't as much demand, but now is the time to be supporting our not-for-profit and charity sector.

Anne Webster (Mallee, National Party) Share this | Link to this | Hansard source

I rise today to speak on the important role played by charities in Australia's economy and society, and to speak on the government's work to support the charities sector and enact reforms recommended by the Australian Charities and Not-for-profits Commission, ACNC. I agree with Dr Leigh's first point, that the charity sector is one of the most trusted in Australian public life. However, I don't agree that the government has failed to act on fundraising reform. Since the government tabled in parliament the ACNC review panel's report in August 2018, the Assistant Minister for Finance, Charities and Electoral Matters, Senator Zed Seselja, has consulted extensively with the charities sector, the community and with the state and territory ministers to understand the views on the review panel's recommendations. Thanks to Senator Seselja's hard work in this space, in March this year the government delivered its response to the ACNC review with three themes in mind: reducing red tape, increasing transparency and having an effective regulator.

I have been involved in the charities sector for over 14 years myself, through the development of a not-for-profit to support young mothers into education and employment. Through my experience, I have found that the chief role of government is to provide an effective framework within which charities can freely operate. This framework should support the work done by charities, not dictate to them. Of course, regulation and accountability are also key components of the government's role. The government's response to the review shows that we are committed to a regulatory regime for charities that fosters a vibrant and innovative sector. By reducing red tape, we will ensure charities are able to focus on serving their community, not simply ticking boxes. And all the charities that I speak to in Mallee confirm this objective.

The government is ensuring the ACNC can continue its important role as a regulator for the industry. The ACNC has become a highly regarded institution and is an integral component of the framework that allows charities to flourish while providing transparency and trust in the sector. The ACNC is also working with the states and territories to remove the duplication of reporting obligations, including the harmonisation of fundraising regulation so registered charities that report to the ACNC no longer report to the states.

Finally, the government is focused on strengthening trust and confidence in the charities sector to ensure public faith in these institutions is maintained. The government's response to the review into the charities sector gets the balance right between reducing red tape for charities while ensuring Australians can trust the sector they so generously support. With these reforms, the 57,000 charities across Australia, including many in Mallee, can focus on helping those in need, and Australians can continue to give generously of their time and money with confidence.

The charities sector has not been immune to the health and economic impacts of COVID-19, which is why the government has extended unparalleled support for the sector during this time. Charities have been able to access the jobkeeper payment through a test more generous than that offered to any other sector. The 15-per-cent-turnover decline test and the option to exclude government revenue from their calculations to access jobkeeper was a response to urgent calls from the sector to which the government promptly responded. This measure supports charities like the Salvation Army and the Catholic Social Services as well as local charities across Australia that are expected to have a significant increase in demand for their services during this pandemic. Charities are also able to access the boosting cash flow for employers program, providing a minimum payment of $20,000 to eligible employers. The charities sector employs over 1.3 million Australians, and many businesses in the country will benefit from this stimulus.

The government has also announced the $200 million Community Support Package to assist programs delivered by charities during COVID-19, including emergency and food relief and financial literacy services. This package includes a $100 million funding injection to more than 300 charities and community organisations to conduct these activities and support Australians in the wake of the coronavirus economic turndown.

The government is actively supporting the charities sector through our response to the ACNC legislation review and via immediate and direct funding support in light of the COVID-19 pandemic. I would like to thank the Assistant Minister for Finance, Charities and Electoral Matters, Senator Zed Seselja, for his outstanding work, and offer—(Time expired)

Rebekha Sharkie (Mayo, Centre Alliance) Share this | Link to this | Hansard source

Charities and not-for-profit organisations are the bedrock of our communities, especially in my electorate of Mayo, where we have one of the highest rates of volunteering in the country. However, the government has dragged its feet on proceeding with reforms that would remove a range of unnecessary obstacles facing charities, some of which are particularly urgent in the intensely online world of COVID-19.

I have two particular concerns regarding the regulation of charities that I believe need urgent attention. My first concern relates to the process by which charities receive their tax-deductibility status, known in the jargon as deductible gift recipient, DGR, status. It is best illustrated in two brief stories. I have an NGO in my electorate which does excellent work and clearly fits the environmental DGR category. They put in their application and did everything right, and then they waited. And followed up. And then they waited. And then they followed up again. And then waited. After more than 16 months of frustration, they got in touch with my office. My office contacted the relevant branch of the environment department, who were required to undertake an initial assessment. They proclaimed that the application had been sent to Treasury many months ago, and the hold-up was Treasury. My office then called Treasury the next day, only to learn that the application had been received the day before. About 40 phone calls later to both Treasury and the Assistant Treasurer's office, the application was finally approved. The organisation was perfectly eligible. There were no complications in the paperwork. It shouldn't be this hard.

I have another organisation in my electorate that provides veterinary services during emergencies such as bushfires. They applied for DGR status but were told by the unit in Treasury that they did not fit any category. They were then actively encouraged to withdraw their application, which means that they would not need to be considered anymore. The NGO representative said that they would consider it, only to find that their application was then closed off. When the summer bushfires hit and badly damaged my electorate, the organisation was still struggling with the bureaucrats to get their application considered. Thankfully, the Assistant Treasurer's office was able to help my office use the emergency to get their application over the line. It was considered to be an animal welfare charity, which should surprise absolutely no-one.

The DGR system is clunky. These two stories are just a couple that I'm sure are felt in 151 electorates across Australia. This shows the need we have for reform. In particular, the specific list process is woefully ill-equipped to deliver outcomes. Yet, in response to my question in writing on the matter, the government said they had 'no current plans to review the DGR specific listing process'. That is, I believe, simply unbelievable and unacceptable.

The second issue of concern I wish to raise is the lack of transparency in the remuneration of executive management in large charities. Having worked in the sector, I'm deeply concerned that some charities have executive pay cheques in the many hundreds of thousands of dollars, with bonuses, but with no meaningful accountability. They don't need to put it on their annual return. They can stack boards with their mates and put themselves on wages in excess of the Prime Minister's. Donors deserve transparency around where their donations are going and whether their altruism is being cannibalised by top-heavy executive pay packets.

Recommendation 15 of the legislative review found that large registered entities should be required to disclose the remuneration paid to responsible persons and senior executives on an aggregated basis. I was pleased to see that the government has agreed to implement this recommendation, and I strongly urge them to proceed with this reform as soon as possible. It is issues such as this that are making many people in our community concerned about giving their hard-earned money to charities. We need people to continue giving in our nation in order for us to get through the crisis of COVID and bushfires and support our community generally.

Helen Haines (Indi, Independent) Share this | Link to this | Hansard source

Australians are a generous people. The most recent Giving Australia survey found that an estimated 14.9 million Australian adults—that's around 80 per cent of Australian adults—give around $12.5 billion to charities and not-for-profit organisations each financial year. I saw this generosity firsthand in my electorate of Indi this past summer as the bushfires ripped through and devastated communities, property, livestock and wildlife. Within a matter of weeks over $500 million was raised to help support the volunteers fighting the fires as well as provide emergency relief and recovery assistance to the communities reeling from the impacts of those fires. Another story emerged as well during that time around the efficacy of the management and distribution of those moneys.

Charities and fundraising drives of all shapes and sizes were inundated with generous donations from large multinational aid organisations like the Red Cross to online platforms like GoFundMe, regional organisations like the Country Fire Authority of Victoria and local operations and organisations operating out of our region, like the Into Our Hands Community Foundation. Each of these organisations had bona fide objectives: to do the best they could with the resources they had to assist the community in need during an emergency. But as the weeks unfolded questions were raised across Australia and, indeed, internationally, about how well this charitable giving was coordinated and whether the system governing charities in Australia was getting in the way of an effective response. Many expressed frustration at large sums of charitable donations destined for bushfire affected communities sitting in the trust accounts of large organisations, waiting for sign-off to be deployed. Others welcomed non-charitable methods of raising funds that could be injected into communities and households overnight, such as crowdfunding campaigns on social media, but they were wary of the lack of oversight and exposure to abuse.

In the moment, it was difficult for even the most well intentioned to know how best to help. We all remember the amazing work of comedian Celeste Barber and the raising of $51 million in charitable donations for the New South Wales Rural Fire Service, which the New South Wales Supreme Court later found could not be legally redirected to other bushfire relief charities or for other purposes even if the New South Wales Rural Fire Service wanted to, because of its governing trust deed. Just yesterday, the ABC reported that, of the $282 million donated to the Red Cross, the Salvation Army and St Vincent de Paul, $135 million is yet to be spent.

Now there are often good reasons for this. Bushfire recovery is not a one-week thing; it lasts for many years. It makes sense to keep some money in the bank to finance recovery needs a year or two down the track, once the spotlight has gone. But many members of the public are wondering where their donations have gone and how they're being spent, especially when there is still so much need out there. Part of this is also anger at the slowness of government's response. When people look at their situation now, six months on from the fires, it's fair enough to direct that frustration at the general powers that be. It's heartbreaking to hear people say that after this bushfire season they will never donate to bushfire recovery again. Australians, as I said at the beginning, are generous people, but they don't like to feel like the wool's being pulled over their eyes. I don't believe for a second that it is, but clearly we must do more to ensure there is transparency about how the money we donate to bushfires will be spent.

This is not about bashing the charities. The Red Cross, the Salvos, Vinnies and many smaller charities are often the first people on the ground in the wake of a disaster. I've met so many of them. They're outstanding. They've committed to being around for years to come. But the many letters I receive indicate there is a gap between community expectations and the way donations are delivered on the ground. There are many things we can learn from this bushfire season, and re-imagining how charities work is one of them.

The motion raised by the member for Fenner notes that current fundraising laws and governance regimes do not allow charities to make optimal use of the resources donors provide. The current rules are from a time gone by and not nimble enough to respond to real community needs. I'd like to echo these concerns, and I will support any push in this place to support charities and the work they set out to do. Australians have an immense spirit of giving, and we should do what we can to cultivate that to ensure that these generous everyday Australians feel confident and have the trust to give again when inevitably we need to call on them in the future.

Rick Wilson (O'Connor, Liberal Party) Share this | Link to this | Hansard source

There being no further speakers, the debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.