Andrew Leigh

HOUSE OF REPRESENTATIVES, 10 JUNE 2020

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.

ENDS

Authorised by Paul Erickson, ALP, Canberra.