Ideas@TheCentre
Government stifles charities
When the federal government set up the Australian Charities and Not-for-Profit Commission in 2012 to regulate the nation’s charities, it said the reforms were designed to restore public confidence and trust in the charitable sector.
In reality, the reforms are only a pretext for extending government control over the charitable sector. Charities run the risk of becoming government lobbyists.
Since charities are responsible for money donated privately or awarded from public funds, some degree of regulation is welcome.
However, the new regulatory regime imposes reporting protocols that will only add to the administrative burdens already borne by charities and make it harder for them to pursue their work effectively.
In the past, charities largely depended on private, voluntary action. Today, they depend on high levels of public funding.
According to the 2010 Productivity Commission report Contribution of the Not-for-Profit Sector, government transfers to Australian charities comprise a third of the sector’s income.
The greater array of services that charities now deliver on behalf of the state puts strain not only on the partnership but also the very meaning of charity.
Dwindling income from voluntary contributions may have provoked fears that the public has lost confidence in Australian charities. The real problem, though, might be that charities have lost confidence in themselves.
Speaking in debates in the British House of Lords during the passage of the UK’s Charities Act 2006, Lord Darren said, 'A thriving civil society consists of a creative chaos of voluntary and essentially private activities by individuals and their associations.'
Darren argued that this creative chaos was best encouraged by a lighter regulatory approach for smaller charities and imposing the discipline of consumer choice on larger charities that received government funding.
Instead of heeding this advice, the federal government is stifling the creative chaos of private and voluntary action at the heart of charitable endeavour in a healthy civil society.
This doesn’t just put at risk the discretion of individual donors and philanthropists.
It also threatens to weaken the spirited involvement of Australians freely choosing to associate and act, independently of the state, for the benefit of all.
Peter Kurti is a Research Fellow with the Religion & the Free Society program at The Centre for Independent Studies and author of In the Pay of the Piper: Governments, Not-for-Profits, and the Burden of Regulation.
