Consumer Law Review to Deliver Final Report as Sector Polled on Fundraising Reform

State and federal consumer affairs ministers are expected to receive the final report of the long awaited inquiry into Australian consumer law (ACL) on Friday – including recommendations for national fundraising regulatory reform.

The release of the report comes as Pro Bono Australia is taking an instant poll of the not-for-profit sector’s appetite for fundraising reform and the sector prepares for a Melbourne forum on the current state of play.

The Twitter poll question is:

Does having separate charity compliance requirements in each state result in more red tape and less accountability?

Take the poll here.

HAVE YOUR SAY: Does having separate charity compliance requirements in each state result in more red tape and less accountability?

— Pro Bono News (@ProBonoNews) March 29, 2017

The ACL review was undertaken by Consumer Affairs Australia and New Zealand (CAANZ) in June 2015.The Australian Consumer Law Review Interim Report was released on 14 October 2016 and identified options to improve the law’s efficiency and effectiveness including charity regulations.

During the inquiry, CEO of Community Council for Australia David Crosbie said the review of ACL was an important doorway to harmonisation.

“The ACL can easily be clarified and amended to ensure charities are required to meet a clear set of consumer-focused expectations and requirements in all their fundraising activities. We do not need seven sets of onerous and ineffective regulations.”

However he said: “CCA understands that the main barrier to achieving reform is not a lack of a policy solution or even state reluctance to let go of their regulatory role, the problem appears to be that key ministers and policy makers could not be bothered because it is not considered a significant issue.”

“It seems that while cutting red tape for business is essential, cutting red tape for charities is not.”

The current state of fundraising regulation in Australia has also been described by a coalition of Not for Profit peak bodies as inconsistent, fragmented, outdated and rarely enforced and in need of urgent major reform.

The sector’s concern led to the national #fixfundraising campaign.

Director not-for-profit law at Justice Connect Sue Woodward said: “Our campaign argues that with the seven different state and territory laws, any charities that aspire to collect Australia-wide, or even small groups using the internet to raise funds, must abide by a minefield of rules and regulations that add millions of dollars in unnecessary cost to the not-for-profit sector.

“The duplicative and complex nature of Australia’s current regime, with charities having to deal with both the Australian consumer law and the archaic state-based laws, diverts and distracts many wonderful volunteers from compassionate activities to mind-numbing and unnecessary paperwork.”

The peak bodies put together a three-step plan for fundraising reform:

1. Clarification and minor amendments to the Australian Consumer Law (ACL) to ensure application to fundraising activities is clear and broad

2. Repeal of fragmented state and territory fundraising laws, and

3. Work with regulators and self-regulatory bodies to provide guidance to fundraisers to continue to improve fundraiser conduct.

Earlier this month the Victorian Minister for Consumer Affairs Marlene Kairouz spoke at an invitation only meeting of consumer affairs ministers and policy makers where she said: “I’m also aware that among the issues you have championed is that of nationally consistent fundraising regulation – to both improve the clarity of the ACL’s application and to reduce regulatory burden.

“Research undertaken for the Australian Charities and Not-for-profits Commission in 2016 showed that state and territory regulation of charities (including fundraising regulation) imposed costs to registered charities of over $15 million per year.

“This is money wasted and just one reason why I support your calls to overhaul this aspect of the ACL. While I would hope that my colleagues in other jurisdictions are of a similar mind, the reality is that evolution for some looks akin to revolution for others and achieving a consistent view will be a challenge.”

Reform has also been championed by the Australian Institute of Company Directors (AICD).

AICD CEO John Brogden has said: “Charities and other NFPs are wasting millions of dollars on outdated and unnecessary regulation – funds that should be going to Australians in need.

“Across Australia’s seven different fundraising regimes, however, there is variation in the requirements for fundraising at each stage, from when and if a licence is needed, to how long a licence is valid, right through to what must be reported and when.

“This duplication and confusion means charities and NFPs are having to spend time and money on red tape rather than pursuing their missions.”

The final report is not expected to be made public on Friday and the consumer affairs ministers have until August 2017 to decide their their response.

What are the sector’s thoughts on current fundraising regulations and the need for reform? Take our instant poll here.

The not-for-profit forum will take place in Melbourne on Wednesday 5 April to discuss the current fundraising regulation. The Victorian Minister for Consumer Affairs Marlene Kairouz will attend and the federal shadow minister for charities Andrew Leigh will also take part in a forum.

Find out more here.