Charities say bill will hamper them

By KEVIN TAYLOR

Officers of charities will resign and volunteers will not come forward because the Charities Bill is too onerous, a parliamentary committee has been told.

In submissions to the social services committee yesterday, charity after charity criticised the bill as being too strict and costly.

St Vincent de Paul Society national treasurer Patrick Sheehan told MPs he would resign if the bill became law in its present form because it banned officers of charities getting indemnity insurance.

He said the bill would "seriously damage" the charitable sector by restricting its work because valuable resources would be diverted to meeting larger administration and compliance costs.

The bill establishes a commission that will register and monitor charities. Charities not registered will lose their tax-exempt status.

Mr Sheehan said the society opposed the provision making officers personally liable for paying administrative penalties to the commission.

"It is difficult enough to source individuals willing to assume leadership roles without imposing a potential personal liability as part of their job description," he said.

Mr Sheehan said not only officers would be put off joining, but other volunteers would be as well.

The society's immediate past-president, Kevin Tansley, estimated the bill's requirements would occupy one person full-time - at a cost of $30,000 to $40,000 for a charity with an annual income of less than $200,000.

Mr Sheehan said charities should not fund the commission, as was proposed.

The Government should fund the commission as an indication of support for the work charities did, he said.

"After all, charities are subsidising the Government for the work which governmental bodies are not being funded for."

Other charities also criticised the requirement that the sector fund the commission, pointing out the Government already funded regulators in other sectors such as the Commerce Commission and the Securities Commission.

Salvation Army chief financial officer Victor Saywell said nothing in the bill encouraged a "generous philanthropic society" and real recognition of the millions of voluntary hours given each year.

He said the bill would create a "major bureaucracy with significant compliance costs and risks for no benefit".

The compliance requirements and risks could deter volunteers from giving their time and donors from giving money.

Mr Saywell said the bill's requirement that charities display their registration number on all correspondence was "burdensome and unnecessary".

Andrew Hubbard of the Council of Christian Social Services said anyone wanting to mislead the public could easily make up a registration number and it would not be easy for the public to check.

He criticised the commission's deregistration powers as "far too wide".

Concerns about bill

* Compliance costs from registration with the new Charities Commission.

* Ban on officers of charities getting indemnity insurance.

* Making officers personally liable for paying administrative penalties to the commission.

* Requiring the charity's registration number to be used on all documents.

* The commission's powers to deregister charities, which charities say are too wide and punish them - and the public - for minor infractions.

* The lack of an advocacy role in the definition of charities, which they say puts them at risk of deregistration should they oppose Government policy.