Paul Scarr (Queensland, Liberal Party) Share this | Hansard source

I say to you, Senator Siewert, that I could anticipate knowing what you would have said, and you would have said it with the great passion you bring to all debates in this place. As a relative newcomer to this place, I really pay tribute to you. You've been a great example for everyone to follow.

Maybe I should say something nice about all the senators in the chamber. I won't say it's going to get progressively harder as I go around the chamber, because it won't, but I should get back to the topic under discussion, which, of course, is the legislation we're talking about today, the Treasury Laws Amendment (2021 Measures No. 2) Bill 2021, which deals with charities.

If I can, I will talk for one moment about the issue of JobKeeper. I just want to flip it. I want to make it a positive. Let's make the negative a positive. Senator Sheldon made some negative points, and I take them on board, but let's talk about some positive points with respect to JobKeeper. The first point is that it was a massively successful system. It was a game changer. It absolutely was a game changer when this pandemic first hit Australia. I think we as a country and both sides of parliament—all of us—should be very satisfied with the impact that JobKeeper had. It saved hundreds and hundreds of thousands of jobs and made sure that businesses, small and large, could keep operating. That was so important. I, like many representatives in this place would have, met businesspeople across Queensland at that time who described what it was like to be under such stress. Then the announcement of JobKeeper arrived, and it was transformative. They saw a future. So let's first take a moment to reflect on how successful the system was, on how successful the policy initiative was.

The second thing to note is that what's being discussed here isn't a question of companies going outside the realm of what was permitted by the JobKeeper legislation. It should be noted that at the time companies were applying for the JobKeeper incentive no-one knew what the future was going to be like. The companies didn't know whether or not they were going to be profitable in the eight, nine or 10 months ahead. They just didn't know. The policy was available for them. It was intended to be a generous policy. It was intended to be proportionate. It was intended to be limited in time frame. It was intended to get the money out there as quickly as possible. It was successful. The companies who applied for JobKeeper payment didn't know what the future held for them.

Thirdly, I will talk about some of the companies who have paid back some of the JobKeeper that they've received. We should take a moment in this place to acknowledge those companies, who considered their own circumstances—I don't know all of their circumstances—and have repaid JobKeeper payment to the Commonwealth, to the Australian people. I will mention a few at this point and call out to them and congratulate them, because I think their example is a shining bright example for all Australians. The first one is SIMEC. It received $20 million in JobKeeper payments and repaid $20 million. Iluka Resources received $13.6 million in JobKeeper payments and repaid $13.6 million. Santos received $4 million and repaid $4 million. Domino's Pizza—I wouldn't know who they were as I've never heard of them; don't laugh too loudly, Senator Hume—received $0.8 million and repaid $0.8 million. Adelaide Brighton received $0.2 million and repaid $0.2 million. Toyota, apparently, received $18 million and repaid $18 million.

Senator Dean Smith interjecting—

Oh what a feeling, Senator Smith! Absolutely, oh what a feeling. That's right, a bit of product placement in the Senate. There were also four companies outside the ASX 300 who repaid JobKeeper amounts, and I think we should acknowledge them as well. They were Australian Clinical Labs, Peter Warren Automotive, Universal Store and Dusk Group. Congratulations to all of those companies, who at the time of the pandemic were entitled to receive JobKeeper payments. They didn't know what was going to happen in the months following, so they applied for and got the JobKeeper payments. Looking back in time, they didn't need the payments, and in good conscience, in accordance with their social licence, they repaid those amounts. I congratulate each and every one of those companies.

Moving on to charities, there was a bit of talk around regulations et cetera in the charities space. Let me simply say that I commend the work of our scrutiny committees to everyone who watches what happens in this place and reiterate how much I enjoy serving on both scrutiny committees with my good friend Senator Carr on the other side of the chamber. Our scrutiny system does great work, and I'm sure it will do great work in the years and years to come.

The first point to note with respect to charities is that charities perform an absolutely crucial role in filling the gaps, in making sure that aid is provided to those less well off in our community, to vulnerable Australians. Government can't do it all. I've seen over the course of the COVID-19 pandemic just how important our charities are in reaching different groups, different cohorts of people who weren't being given enough aid, not through any act of bad faith or anything but simply because they've fallen between the cracks for whatever reason, and our charities are always there to support them. That's a wonderful thing. Not only are our charities there to support those vulnerable people, but Australians are there to support the charities. That also is a great thing. That spirit of philanthropy, that spirit of generosity, goes to the very heart of what it means to be an Australian.

The second point I will make is in relation to tax deductibility. It is fit and proper that we as a civic society give an incentive to the private citizen to make a charitable donation, so I fully support the concept of deductible gifts which can be taken off your assessable income. I also think it's quite reasonable for the government and individual taxpayers who are donating to these charities to expect some sort of conformity and consistency with respect to the regulation of charities and those groups and organisations that get the benefit of deductible gift status.

It should be noted that in 2017 Treasury identified 28,000 different organisations—that actually surprised me—who qualify for the deductible gift recipient classification. Of those, 18 per cent were not registered charities—10 per cent were government entities and eight per cent were others who can transition to become registered charities. That's what we are talking about there. That's the field we're talking about—eight per cent of the 28,000. Those were the figures back in 2017. I think it is important that there's consistency in approach for deductible gift recipients and also for charities. Schedule 1 of this legislation seeks to promote that consistency.

What's the framework that those deductible gift recipients are being brought under? They are being brought under a framework that is absolutely appropriate in terms of the regulation of charities. Australia has a very robust system in terms of regulating our charities and ensuring—and the Australian people are entitled to be assured—our charities are well run, transparent and accountable. Of course this happens under the Australian Charities and Not-for-profits Commission Act. Under that act six standards have to be met by any charity. I want to run through those six standards.

The first standard is about the purposes and not-for-profit nature. A registered charity must be not-for-profit and work towards their charitable purpose. That charitable purpose must go to the heart of what that organisation does. The charity must be able to demonstrate this and provide information about their purpose to the public. So that charitable foundation has to go to the heart of the organisation.

The second standard is in relation to accountability to members. Charity members must be able to take reasonable steps to find out what the charity is doing. The charity has to be accountable to those members. Members have a legitimate right to raise concerns and issues and have those concerns addressed by the charity. A charity should not ever just be run for the benefit of a small group at the top. It needs to be accountable to the membership. That's absolutely crucial.

The third standard is about compliance with Australian laws. There was some discussion with respect to proposed regulations in that regard. I note for the record that at the moment charities must not commit a serious offence, such as fraud, under any Australian law or breach a law that will result in a penalty of 60 penalty units, which is currently $13,320 or more.

The fourth standard is about the suitability of responsible persons. Charities must take reasonable steps to be satisfied that its responsible persons, such as board or committee members or trustees, are not disqualified from managing a corporation under the Corporations Act. If you've been disqualified from managing a corporation under the Corporations Act, you shouldn't be on the executive board or a director of a charity. That should go without saying. If you can't be a director of a company, you shouldn't be a director of a charity.

The fifth standard is about the duties of responsible persons. Charities must take reasonable steps to make sure that responsible persons are subject to, understand and carry out the duties set out in this standard, including to act with reasonable care and diligence, to disclose conflicts of interest and to ensure that the financial affairs of the charity are managed responsibly. That's fair and reasonable. If there's an incentive for people to make donations to charities to provide them with a source of revenue and those charities get the benefit of that then the flipside is that there needs to be responsibilities and duties imposed on those who are running the charity.

The sixth standard is about maintaining and enhancing public trust and confidence in the Australian not-for-profit sector. I want to quote this, because this is really important. A charity must:

… take reasonable steps to become a participating non-government institution if the charity is, or is likely to be, identified as being involved in the abuse of a person:

(a) in an application for redress made under section 19 of the National Redress Scheme for Institutional Child Sexual Abuse Act 2018 (Cth) (Redress Act) or

(b) in information given in response to a request from the National Redress Scheme Operator … under … the Redress Act.

I would like to take this opportunity to commend my very good friend—and I don't say that lightly, even under parliamentary privilege—Senator Smith in relation to the work that he's done in this space. I think it's incredibly important work, and I know how seriously Senator Smith treats that work and that it comes from the heart, which is so important to the survivors of those horrific events. I can remember how shocked I was seeing the list of Queensland based charities and not-for-profit organisations that had come within the National Redress Scheme. It was nearly everyone. It gives everyone cause for deep reflection.

So those are the six standards under which these deductible gift recipients are going to have to transition to the charitable legislation, and it's fit and proper that they should do so. But they'll also be given time to do so. They'll be given at least 12 months to make that transition, to get their paperwork together and to do all the things they need to, and that time can be extended in certain circumstances if the regulator sees fit. One of the scrutiny committees on which I've sat has also had something to say about those circumstances. I think it is fit and proper that there is a situation where the organisations can be given more than 12 months to make that transition if they need it. On that basis, I'm happy to support this bill.