SENATOR DEAN SMITH
SHADOW ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY
SENATOR FOR WESTERN AUSTRALIA
MEDIA RELEASE
19 July 2024
CHARITIES REPORT A WASTED OPPORTUNITY WHEN AUSTRALIANS NEED IT MOST
Australia’s charity sector is supporting millions of households through the Albanese Government’s cost of living crisis, but it has also been fighting for its life.
Battling record demand and skyrocketing overheads on Labor’s watch, it has fought through the last two years unsupported and uncertain.
That uncertainty now continues with the release yesterday of the Productivity Commission’s final report, Future foundations for giving.
The Report contains a drastic proposal to reshape the Deductible Gift Recipient system in Australia – and the activities of many of the nation’s charities along with it.
The result, unless Labor rejects these changes, will be victory for an ideological attack on religious charities in particular.
Every bit as concerning, the Report represents no immediate, meaningful pathways to growing charitable donations at a time they are desperately needed.
Ideological attack
The Productivity Commission itself notes “many participants also expressed significant concerns” regarding the removal of DGR status from entities including religious charities and school building funds.
Despite this, it chose to ignore these concerns – the Report features six additional recommendations and one re-worded recommendation to those in the Draft Report, but the proposed DGR reforms are unchanged.
Assistant Charities Minister Andrew Leigh might have committed to maintaining the DGR status of school building funds yesterday but, given Labor’s track record of breaking promises, doubt remains.
The Report now serves as a blueprint to transition school building funds, including those of thousands of public schools, out of the DGR regime whenever it suits Labor to do so.
The Report recommends axing the status of a “basic religious charity” and its associated exemptions – specifically targeted at activities with the “sole purpose of advancing religion”.
It prioritises instead charities focused on advocacy, including those driving social and environmental change.
Dr Leigh’s silence on the future position of religious charities, among them some of the largest contributing and most trusted in Australia, leaves a noose around their necks.
Fails to boost giving
Labor’s goal is to double philanthropic giving in Australia by 2030 and a key purpose of the Report – noted in the Treasurer’s direction to the Productivity Commission – was to “increase opportunities for philanthropic giving”.
It is debatable if the Report’s recommendations have, or will, achieve either.
For a start, very few of its recommendations are specifically aimed at boosting giving.
In fact, apart from recommendations removing the minimum donation threshold and coordinating distribution of funds, most are heavily focused on regulatory issues and the future administration of the Australian Charities and Not for Profits Commission.
This is red tape over genuine improvement – something laid bare in recent Estimates hearings when Productivity Commission officials confirmed it had not even modelled how these proposed DGR changes would impact levels of giving.
Comments attributable to Senator Dean Smith:
“As the election approaches, Labor has failed to deliver meaningful reforms to Australia’s philanthropic sector.”
“This is especially unacceptable as the sector looks for real leadership at a time when it faces unprecedented challenges.
“Many will be forced to accept the work of the Productivity Commission on this as a wasted opportunity.
“Despite the widespread concerns raised, the Productivity Commission has pressed ahead and presented Labor with a weapon aimed at some of our major charitable organisations in parts of this Report.
“I call on Andrew Leigh to make clear which recommendations will be adopted and which won’t on an urgent basis – but, regardless, we all know this will hang over the heads of the sector and our communities while Labor remains in power.
“That fact that the Report does not adequately prioritise growing giving is hugely disappointing and Labor must step in to fill this growing void.
“I urge Andrew Leigh not to fall into his usual routine of round tables and studies, and instead focus on actually providing outcomes for the sector.
“Labor has some clear choices here – and if they choose ideology over practicality Australians will be the losers yet again.”
ENDS