Politicians must act now to fix fundraising red tape

Posted on 06 Oct 2020

By Denis Moriarty, group managing director, Our Community

Piggybank

I’m normally mild-mannered, and I respect our institutions, and it’s not often that I use strong language in submissions to government ministers. But everybody has a breaking point when it comes to pain inflicted on our communities.

Our Community's Denis Moriarty

My breaking point is the seemingly interminable number of government inquiries, reports, reviews and discussion papers that have done nothing to fix Australia’s broken fundraising laws. The latest in a long line of obfuscations is a discussion paper, Proposed cross-border recognition model for charitable fundraisers, from the Charitable Fundraising National Working Group. In writing a submission in response to this paper, I found myself getting sweary.

The law in this area is not fit for purpose. To put it simply, it’s impossible to put it simply. But reform efforts are underway. That’s good, isn’t it? Well, it would be if the proposed ‘reforms’ did anything to cut the red tape that is strangling not-for-profits.

Let me explain. Originally, a not-for-profit organisation would be registered in only one state. If it wanted to operate interstate, it’d have to register in all the other states. That was silly, so government passed a good law to say that if you became a ‘Registered Australian Body’ you could operate in all states.

Then we passed the Charities Act, so that charities could be registered nationally with the Australian Charities and Not-for-profits Commission (ACNC) . But we didn’t change the state and territory acts, so charities still had to report to the state regulators as well. That was silly, so over many years the states reluctantly agreed that charities only needed to report to the ACNC. Hooray!

Except that all the states had a separate system for registering fundraisers. This involved making the same reports to the same regulator wearing a different hat, and as all not-for-profits raise funds, they still had to fill out as much paperwork as ever. That was silly, so the states got together again and in a burst of enthusiasm they recently agreed that any charity registered with the ACNC doesn’t have to report to state fundraising regulators. Hooray!

BUT. And it’s a big but. Most not-for-profit organisations aren’t charities. To be a charity, in the technical sense of the term used by the ACNC and the Tax Office, you have to fit within very narrow boundaries. After this latest round of ‘reform’, small not-for-profit organisations, the ones that have the least resources, are left exactly where they were, up to their waists in meaningless paperwork.

The federal government could have fixed the fundraising problem with the stroke of a pen, just by saying that any registered Australian body could fundraise in any state and be regulated by the Australian Competition and Consumer Commission, like other businesses. But that was apparently too simple.

As I wrote in my submission, ‘It’s an indictment on every senior bureaucrat who has held responsibility for fundraising law for the past 20 years, along with every Minister responsible for such laws.

‘While Rome is burning, with governments failing to act on multiple governance failures, fraud and endemic mega-money laundering at our casinos, we witness 20 years of pointless red tape and micro-management of well-meaning community groups who are simply trying to collect $50 from the public.

‘There are eight state and territory ministers with responsibilities for fundraising. Isn’t there just one clever or brave enough to simply tell the relevant bureaucrats to get off their arse and fix it?

Sure, there a lot of more important issues that I could be getting upset over – climate change, income inequality, indigenous disadvantage. In these areas, too, our governments are firmly committed to the absolute maximum of reform that’s compatible with the absolute minimum of change.

A journey of a thousand miles begins with a single step, as the old proverb has it, but that was before the invention of the electric scooter. Why do we put up with this slow path of incrementalism when it comes to the community sector?

We should be able to expect of any government that when faced with a difficulty it will analyse the problem, find the best solution, and put it into practice. During the pandemic, in fact, that’s what they’ve been trying to do. Can’t we hold them to that standard afterwards?

As my hero Casey Bennetto sang, ‘But still I dream of a country rich and clever, with compassion and endeavour reaching out towards forever, and I'm still dreaming of the light on the hill.’ Our communities deserve better from government, and from the nine state and territory ministers responsible for finding a way to #fixfundraising.

Denis Moriarty is group managing director of OurCommunity.com.au, a social enterprise helping Australia's 600,000 not-for-profits.

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This article is part of Our Community's campaign to help not-for-profits through the COVID-19 crisis, comprising guides, webinars, resources and news.

This commentary also appeared as part of a monthly column that's published in 160 rural and regional titles across Australia, from daily newspapers such as the Bendigo Advertiser and the Illwawarra Mercury, to weekly publications such as the Goulburn Post, the Cootamundra Herald and the Jimboomba Times.

We're proud to take a stand on progressive issues, which we're able to do as a social enterprise that's not tied to the purse strings of any government or corporate organisation.

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