Charities Urged to Have Their Say on Foreign Donations Bill

Charities are being called on to have their say on the controversial foreign donations bill “while they still can”, amid fears the bill could “erode democracy”.

The Election Funding and Disclosure Reform Bill, which aims to ban foreign donations and introduce new disclosure requirements for political campaigners, was referred to the Joint Standing Committee on Electoral Matters by Minister for Finance Mathias Cormann on 6 December.

Submissions are set to close on 25 January with a report due by 2 March 2018.

The Australian Council for International Development, part of the coalition behind the Hands Off Our Charities campaign, is encouraging charities to make a submission before the deadline closes on Thursday.

“In simple terms, as drafted, the bill introduces new definitions and categories which will create new restrictions and compliance burdens for charities,” ACFID government relations manager, Gareth Beyers told Pro Bono News.

“Charities should consider the implications of this bill if they expend any funds on the public expression of their views.”

According to the peak body, the bill is “by no means a foregone conclusion” and it is calling for a complete redraft of the bill to exclude charities.

“ACFID, along with an alliance of charities, will be expressing our concern that this bill will erode, rather than enhance our democracy,” Beyers said.

“ACFID are calling for a complete redraft of the bill to exclude charities. We would strongly encourage charities to carefully examine the impacts and recommend they make a submission to the JSCEM inquiry before [this] week’s deadline.”

The bill proposes a range of reforms including: a registration regime for third party campaigners who incur political expenditure and the establishment of such a register; clarifying the definition of “associated entities”; restrictions on foreign political donations; and limiting public election funding to demonstrated electoral spending.

According to the federal government the bill is necessary to block donations by foreign entities attempting to influence Australian electoral outcomes.

Speaking in December JSCEM chair Senator Linda Reynolds said transparency regarding political donations was necessary to ensure Australians had full confidence in the electoral system.

“Australia already has rules in place to ensure political parties disclose where they receive donations from, but the political landscape has changed since the last major amendments to the Electoral Act in 1984,” Reynolds said.

“There are now a number of political actors that do not qualify as a political party and are therefore not covered under the existing legislation.

“We must ensure the legislation stays up to date with these changes.”

However many in the charity sector have argued the bill will impose restrictions on commentary and advocacy on public issues by Australian charities and not-for-profit organisations.

“As soon as you spend over $13,500 in a year, you are subject to a worrying range of regulation and restrictions,” Beyers said.

“Giving evidence to a parliamentary inquiry or publishing a research paper could be categorised as a declarable expense.

“There is also still considerable uncertainty about whether staff costs would be classed as expenditure. If so, many more charities employing media or advocacy staff could fall within the scope of the bill.

“Even if you don’t spend over the threshold, you would need to monitor your advocacy work to justify why you didn’t register with the AEC as a third party campaigner group. Failing to register will see you liable to a civil penalty.”

Beyers said on top of the practical elements, charities would also need to consider what would happen as a result of being classified as a political or third-party campaigner, “both in terms of their reputation and status”.

“It is extremely problematic that the draft legislation introduces inconsistencies with the Charities Act. Recasting charities’ issue-based advocacy as political campaigning under this draft bill could become problematic when it runs into the prohibition on partisan political activity in the Charities Act,” he said.

“The branding and inconsistency could leave charities vulnerable to accusations of being partisan which, if confirmed, would disqualify them from charity status under the Charities Act.”

The use of international philanthropy for advocacy would also be banned under the bill.

Beyers said the financial sustainability of some charities could come into question as a result.

“Charities will still be able to receive international philanthropy, but will be required to maintain two separate bank accounts to demonstrate that those funds are not used for advocacy. This will be another administrative burden to handle,” he said.

His concerns have been echoed by Anglicare executive director Kasy Chambers, who told Pro Bono News her biggest concern was that the bill could silence people who do not have the money to buy airspace.

“Yes, it’s going to limit charities and their ability to speak, but we don’t speak for charities, we speak for the people who are using our charities and in fact where possible we try and assist them to speak, but often people will need encouragement to do that,” Chambers said.

“We would pose, I guess the argument, that certainly at Anglicare Australia we work with one in 24 Australians, so that is a lot of people whose experience we can collate and bring to policymakers and bring to the public so that we can tell these stories and people can see what’s actually going on.”

In response to the argument that it was not the place for charities to advocate and they should “stick to their knitting”, Chambers said if that were the case they would “still be taking sandwiches to the children working in the mines”.

“If we did that we would still be trying to do Sunday school because that is the only day that children who are working down mines have off. We would still be trying to make sure they had good nutrition while they were working down the mine, but they would still be down those mines,” she said.

Chambers said she encouraged people to have a say on this “while they can”.

“Because clearly if this goes through there won’t be much we can talk about,” she said.

“Having a look at the bill, it is general enough to make many, many people feel wary of speaking out and so if this were to go through this might be one of the last opportunities for having a say.

“I recognise that it is a really short and tight timeline, I think I would like to encourage government to extend that if they could, because it is difficult, people are still returning from holidays and it takes time to give these kinds of things the attention they deserve. So certainly it could be extended but I would certainly encourage people to put into this and to put into the ACNC review which is a month later.”

Under the new law, the definition of “political expenditure” applies to any issue that is or is likely to be before electors, regardless of whether a writ has been issued for a campaign.

Some charities fear that the breadth of the phrase includes not just campaigning via advertising and the media, but also activities like producing a submission and giving evidence to a parliamentary inquiry, or producing a research paper published on an organisation’s website that contains some conclusions.

Chambers said in its current form the bill would catch a lot of charities, and called on the government to exclude charities.

“If this is us getting caught up in the foreign donations thing, it shouldn’t take much for the government to rethink it, have a look, see this is an unintended consequence and get us out of it,” she said.

“The level of the donations that they are asking us to look at is very low, I mean obviously, we would be intensely grateful for a donation of $250, that’s not to say we wouldn’t be able to do things with that, but in terms of the extra admin that this would bring, it is quite a low bar, yet by the same token, the fact that we can’t have done anything within three years of an election, basically means that you could never talk out.

“In reading it I would understand that something like our Rental Affordability Snapshot would be caught up in it, because what we’re doing is we’re collating some research and finding there is not enough affordable housing and therefore we’re talking about government housing policy. And so, I would understand that we would get caught in that way.”

She said human nature was such that people were cautious and would gag themselves even without gag clauses in place.

“So I think my reading at the moment is that it would capture solid research that we all do across the sector, I would expect it to encapsulate most of our work at Anglicare Australia for example. But even if it doesnt mean to do so, the fact that it is vague will make the cautious amongst us step back from that kind of work, and it is exactly that type of work that I believe is one of our core roles to speak out when we find those types of situations,” she said.

The latest call for submissions comes a week after the Human Rights Law Centre warned the bill could face a High Court challenge in its current form.