Charities Send Govt Message to #FixFundraising

Australia’s charity fundraising regulations “are a mess” costing the sector tens of millions of dollars in lost productivity, according to an open letter presented to the prime minister, premiers and chief minister and signed by more than 150 charities.

The letter, which was hand-delivered to the prime minister’s office on Tuesday afternoon and officially launched at a panel discussion and campaign event in Melbourne on Wednesday, forms part of the #fixfundraising campaign which is calling for an overhaul of current regulation.

According to the letter the current regulations are “out-of-date” and overly complex, with separate requirements for each state.

“They deal with wishing wells and the length of handles on collection boxes, but not with online fundraising, crowdfunding and websites,” the letter said.

“Charities want to do the right thing, but it’s too complex, too confusing and it’s ineffective.”

The campaign, led by Justice Connect and the Community Council of Australia, is calling on government to cut the red tape and introduce “one nationally-consistent, modern and fit-for-purpose fundraising regime”.

“We call on your governments to prioritise working together to fix this fundraising mess so we can get on with what we do best – building flourishing communities,” the letter said.

Andrew Leigh speaking at Wednesday’s #fixfundraising forum

Shadow Minister for Charities and Not-for-Profits Andrew Leigh, who attended the event to speak about Labor’s work on national reforms to fundraising regulation, said there were a number of “critical reasons” why Australia needed to move ahead with fundraising reform.

“One is that we need to do more to deal with the problem that I described a few years ago, that of Australia becoming disconnected,” Leigh said.

“We’ve seen social capital decline on a number of measures, we need to do more to make charitable giving a part of regular Australian lives, but a significant threat to that are dodgy charities, charities like Camp Gallipoli, like the fake chuggers, that hit the streets after Vanuatu cyclone, attempting effectively to steal from honest Australians.

“One estimate suggests that every year each Australian gives $4 to a fake charity.

“We need to have a strong charities commission so Australian can log on to the ACNC.gov.au, to check the bona fide-ness of someone who knock on their door.”

He said there was also a need to reduce the paperwork burden falling on charities.

“The paperwork burden is significant and charities in Australia either choose not to comply with registering in every state and territory or else they spend the time to register which on average takes seven days a year,” he said.

“We don’t make Australian drivers get a new driver’s license whenever they want to cross as state border, we don’t make our companies register again if they want to sell a product interstate, so it makes no sense to force our charities who want to fundraise across states to register again.”

Leigh was joined on the panel by Victorian Minister for Consumer Affairs Marlene Kairouz, Save the Children CEO Paul Ronalds, mycause founder and managing director Tania Burstin and Justice Connect not-for-profit law director Sue Woodward, with CCA CEO David Crosbie moderating.

The panel explored the issues associated with the current regulation, the expense, the burden of paperwork, the inability to adapt to new sources of fundraising such as crowdfunding, the “Big Facebook Question” of which states should regulate online companies, the current “state of play” and why, when the solution was “obvious”, it was taking so long to achieve reform.

Kairouz, who was introduced by Crosbie as someone “leading the pack” in harmonising fundraising regulation in Australia, told Pro Bono News the issue was very important.

Forum panel

“It’s very important because it obviously cuts a lot of red tape for the sector, charities, not for profit, and we want them to focus on the work they are meant to be doing rather than sitting behind a desk and ensuring that the proper forms are in place and the boxes are ticked,” Kairouz said.

“The sector contributes economically and socially to Victoria and to the social fabric of our wonderful state.

“Currently we have got legislation in place in Parliament, in the Upper House, and that would enable me as minister for consumer affairs to exempt an incorporated association or a class of associations from annual financial reporting requirements, whether they are also registered with or reporting to another regulator.

“So that is cutting their red tape and you know rather than duplicating their work it is about supporting them and saying if you are already registered with a regulator or with somebody who is well known there is no need for you to do it again.”

She said to bring about the change the sector just needed to keep campaigning and “making noise”.

“The squeaky wheel always works,” she said.

“It’s not that difficult. Having one regulator taking care of charities and not for profits, I can’t see what the issue is, so I think just keep the squeaky wheel going, louder and louder, and hopefully other jurisdictions will jump on board.

“It is not about revolution, it is about evolution. Starting conversations, starting to do things on a small scale in the way we have in Victoria and then hopefully over time, and not a long time but a short time, we’ll have a national approach.”

Woodward told Pro Bono News that Australia could fix fundraising “today” but it needed to be made a priority.

“There is a process underway at the moment, ministers are required to make a decision by August about the recommendations and so if there is no other deadline, that needs to be the deadline,” Woodward said.

“We’re not asking for more money, for any new regulator, this is cost neutral so there is no reason other than it is not the highest thing on the priority list.”

She said the current regulation was hampering the sector.

“We see a lot of really small organisations that are volunteer run and they’re really trying to do the right thing, but no one signs up as a volunteer to fill out paperwork that is completely ineffective,” she said.

“So they have a choice, they either quietly stick their head in the sand and hope no one notices, which broadly speaking no one does, because the state-based regulators aren’t enforcing these laws, or they spend a disproportionate amount of their time and energy, trying to comply and being confused and frustrated and not doing what they really want to do.”

It comes as Pro Bono News conducted a Twitter poll of our readers which found 93 per cent of people agreed that having separate charity compliance requirements in each state resulted in more red tape and less accountability.

Ronalds told Pro Bono News everyone agreed with the solution but the sector was faced with a “degree of indifference” when it came to implementing the change.

“People don’t understand just the impact it is having on organisations like Save the Children, how much work and effort goes into compliance with laws that are just so out of date,” Ronalds said.

“So we need to continue the campaign and make sure all politicians are aware of just its impact on every one of the 600,000 not for profits that are here in Australia.”

He said the sector needed a regulatory regime that enhanced trust and donor confidence.

“Trust in the sector is the bedrock on which all of our organisations operate and what we need is a regulatory regime that actually enhances trust rather than just makes people confused, so that’s in some ways the best argument for the change,” he said.

“Now the fact that we’ve got laws that are probably more honoured in the breach than they are in the adherence, is just another really good reason to make sure that we move to a place where we have simple laws, that organisations can easily comply with and that give donors enormous confidence that their hard earned donations are making the biggest difference possible.

“I don’t think we should leave 2017 without having fixed this.

“So we need to work through the rest of the year, we’ve got nine months left and we’ve got the perfect opportunity in the review of the Australian Consumer Law. We need to use that opportunity to its fullest extent and make sure we finish the year with having fixed fundraising.”

The open letter is available here.