Charities Amendment Bill

I present a legislative statement on the Charities Amendment Bill.

SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon PRIYANCA RADHAKRISHNAN: I move, That the Charities Amendment Bill be now read a first time. I nominate the Social Services and Community Committee to consider the bill.

Charities are vital to our social infrastructure and our nation’s wellbeing, stability, and health as a democracy. The charitable sector is broad and diverse. It’s made up of large national charities, regional community entities, and local groups such, as whānau, hapū, and iwi bodies, Pacific, and ethnic community organisations, churches, sports clubs, and so many more. They provide services that keep people safe, help them in times of need, and support them to live with dignity and to thrive. Charities make an important contribution to our society.

I also want to acknowledge that it’s been a particularly challenging few years, and our community and voluntary sector has acted swiftly and often adapted the way that they work to support those who needed that additional support. I want to acknowledge that and the fact that there are lessons in their response for Government.

It is also a large sector. There are over 28,000 registered charities. Last year, it was reported that the equivalent of more than 145,000 people worked full time in the charitable sector. On top of that, close to 50 percent of New Zealanders volunteer either with an organisation or directly into their community. Charities also contribute to the strength of our economy, having spent almost $20 billion last year.

This is also the sector where I spent most of my working life prior to entering Parliament. So it’s an absolute privilege to read the Charities Amendment Bill for the first time.

The bill amends the Charities Act 2005, which is a key piece of legislation for the charitable sector, and it will make a meaningful difference to over 28,000 registered charities across Aotearoa New Zealand. Before I speak a little bit more about that and explain the changes in the bill, I’d like to extend some thanks and outline the history of this bill.

In May 2018, Cabinet agreed to a review to modernise the Charities Act. I want to acknowledge my predecessors who started this work. Firstly, the Hon Peeni Henare in 2018 and then the Hon Poto Williams. I thank them both for building the foundations of this mahi.

Public consultation on a range of issues then occurred in 2019. However, work was put on pause because of the COVID-19 pandemic, and I picked it back up when I became the Minister in late-2020. This piece of legislation has been a long time coming.

I’d also like to mihi to the sector for their input and passionate engagement with this work. To everyone who attended consultation meetings, made submissions, and engaged with my officials, I extend my heartfelt thanks, and also to officials who have worked on this for many years. Views from the sector have been fundamental to the development of this bill and I thank them for the time and effort that they’ve taken to share their experience and their expertise.

As I mentioned, the Charities Act is a key piece of legislation for the sector. It was established back in 2005 to provide a voluntary registration, reporting, and monitoring regime to ensure that entities receiving tax benefits continue to carry out charitable purpose. The Act has been in place for almost 20 years, and there have been some pretty important changes over that period of time. In 2012, the Charities Commission was disestablished and an independent charities registration board was given the responsibility for registering and deregistering charities. The chief executive of the Department of Internal Affairs was also empowered with certain functions, mainly around education and support for charities and monitoring compliance with the Act. In 2015, new requirements were introduced for financial reporting for not-for-profit organisations, which meant that registered charities had to report to accounting standards when filing their annual return.

Now is a good time to make sure that legislative settings are still fit for purpose. An Act that is working well for charities, the regulator, and the public will help ensure that the charitable sector is effective and enjoys the trust and confidence of the public. Charities do important work and they should be able to focus on this work, but, equally, they receive benefits from being registered, and with that comes an obligation to be transparent. Transparency builds trust, and the public need to be able to trust that charities are responsible with their tax-free income.

The bill keeps the current registration, reporting, and monitoring framework of the Act intact because these fundamental aspects are sound. Instead, the bill makes practical improvements to reporting requirements for small charities, the appeals framework, governance requirements, and the regulatory decision-making and compliance tools. It will ensure that legal settings are up to date, fit for purpose, and will support charities to get on with their important work, while also safeguarding public trust and confidence in the sector.

One of the most significant changes of this bill is introducing a new appeals body for charities. Currently, if charities want to appeal a decision of the Charities Registration Board, they have to go to the High Court. As you can imagine, this can be costly, time-consuming, and difficult, particularly for small charities that are often run by volunteers and with limited financial resources. It’s important that our system doesn’t just work for those who have the resources to navigate it. We need to ensure that the services that are available, and access to them, is equitable.

We need to remove the barriers to justice for charities, and so the bill empowers the existing Taxation Review Authority to hear Charities Act appeals. The authority will be faster, less formal, and cheaper than the High Court. Charities can represent themselves, which reduces legal costs, and they will have two months to lodge an appeal, rather than the current 20 working days.

Now, you may be wondering: “Why the Taxation Review Authority?” Tax and charities have long been linked. Prior to the enactment of the Charities Act, charitable status was determined by Inland Revenue. The bill gives the authority new jurisdiction, and it will be known as the Taxation and Charities Review Authority, when hearing charities appeals funding has been made available through Budget 2022 to enable that change.

The bill also allows more decisions to be appealed as part of the work to improve access to justice. Rather than just limiting it to Charities Registration Board decisions, some of the more significant decisions of the CE can also be appealed.

But access to justice isn’t just about appealing the final decision; it’s also about the decision-making process. The bill presents an opportunity to promote best-practice decision-making by the board and the chief executive. It requires certain decisions to be published for transparency and allows charities to be heard in person to state their case before a final decision is made.

Of course, charities wouldn’t be much without the people who run them. The bill proposes several practical changes to clarify the roles and responsibilities of officers and promote good governance. Sometimes, charities get off track and need education and assistance to comply with the Act. However, when education and assistance has been exhausted and there is problematic behaviour within the charity, the compliance and enforcement tools in the Act become important. The bill improves compliance tools by making it clear what constitutes problem behaviour, and empowers the Charities Registration Board to disqualify an officer.

Finally, the bill enables very small charities to be exempt from reporting to the current financial accounting standards. The annual reporting obligations are a key feature of the Act and are important for achieving the Act’s purpose. The reports are published on the public register. Complying with the reporting standards can be difficult for our smallest charities. The standards set by the External Reporting Board—or XRB—requires pages of financial statements. Charities often need the help of an accountant to complete them. The XRB is aware of the compliance burden and are finishing up consultation on a reduced standard for small not-for-profit entities, and that should make reporting easier and less burdensome. However, if the intended outcome of this work is not achieved, or the standards change over time, this bill provides a regulatory backstop to reduce the compliance burden for very small charities. To maintain transparency, exempted charities will still need to report basic information about their finances and activities in a simple annual return form.

To sum up, this bill is simply about making things easier for charities and maintaining public support for charities. It’s about making the Charities Act an accessible, transparent, and fit for purpose regulatory framework that avoids unnecessary compliance burden and can effectively target problem behaviour when it needs to. It means freeing up resources so charities can get on with the mahi that they’re passionate about: delivering social services, connecting communities to support and resources, building resilience, and contributing to social cohesion. I urge everyone who has an interest in supporting the sector to get involved in the select committee process. I commend this bill to the House. Thank you.

The question is that the motion be agreed to.

Thank you very much, Mr Speaker. I stand to speak to the Charities Amendment Bill today on behalf of the National Party. I’d like to begin by acknowledging and valuing the work that our charities and volunteers do. It’s definitely a cornerstone of the National Party to support communities and especially to value the work that’s undertaken across New Zealand. They deserve to work under legislation that is open and transparent and clear, but also workable.

Now, we have heard from the Minister, the Hon Priyanca Radhakrishnan, the value of our volunteer and charity sector to this country, and it is substantial. In 2019-20, collectively in their reports, we heard: $19.6 billion in combined income, $18 billion spent in this country, and over $65 billion worth of accumulated assets—so not an insignificant sector at all. But we also want our volunteers to be working in an environment that is supported and that enables them to revitalise, energise, and support their communities by being innovative and nimble. Of the 114,000 non-profit organisations in New Zealand, 28,000 are registered under the Charities Act, and they take several forms. There are legal structures that they choose: incorporated societies, incorporated trusts, unincorporated societies, unincorporated trusts, and limited liability companies, as well. Between them, they employ 160,000 full- or part-time employees—so fantastic employers—but, of course, they also manage hundreds of thousands of volunteers.

The charitable purpose is a major part of the omission in this bill. I’d just like to clarify that it is, in fact, a very, very complex legal concept, and it has evolved over 400 years of case law. The statute of charitable users came into force in England in 1601; so it has quite a lot of established case law. And the definition of “charitable purpose” is “the relief of poverty, the advancement of education or religion, or any other matter beneficial to the community”—so quite broad. The legal definition of a charitable purpose may differ from what is commonly understood by the public. It is, in fact, not just about being worthy or good. So the charitable purpose is quite significant in this ongoing debate.

Back in 2017, the Labour Party manifesto said that they would conduct a proper, first-principles review—and independent review, at that—of this Charities Act, but this bill does not deliver on that manifesto promise. But, then, delivery is not a strong point of this Government. It does tweak a few items, and some aspects are going to make compliance simpler, but they don’t address the key items of concern that have been articulated by the charitable sector. They have been waiting on the post-implementation review for over 17 years now.

The Labour Party policy in 2017 was also to consider the 2012 transfer of functions of the Charities Commission into the Department of Internal Affairs (DIA) and whether that transfer, implemented by National, has actually resulted in effectiveness and improved services and openness in information sharing by the sector. But there are limited checks and balances on Charities Services, now within DIA, because it’s now a business unit of Government. Now, that Government department can be subjective in determining the nature and scope of the charitable purpose, but we also know that they can, by virtue of the fact that they can approve or decline a charitable status, make subjective decisions on a charity’s stated charitable purpose. So none of the proposed amendments in this bill actually do address that.

One other thing that has been noted by some stakeholders is how Charities Services tends to focus more on the activities of the charity and how they deliver on their charitable purpose rather than on their purpose. So this means that there is almost an expectation that charities will have similar deliverables, and that’s simply not the case in reality, because every charity is different and every community is different, but their common goals or their outcomes may actually be very similar. So, for example, a charity that provides social support through a local non-governmental organisation, where its purpose is to improve the lives of its community, will have many and varied activities that it undertakes in order to deliver on that purpose—anything from holding community picnics through to delivering counselling services.

I’d like to go back to the beginning of the Charities Act here in New Zealand, which was in 2005, as mentioned by the Minister, by the then Labour Government. It was introduced in 2004 with stakeholder involvement, but when it got to select committee it was virtually rewritten, and when it was rewritten it was without any further consultation with the sector, with the public. And then it was rushed through in 2004, implemented in 2005, under urgency, in one day. So, in terms of an open and transparent process, we have been left devoid of the involvement of the charities sector in the original bill. So when the Labour Party’s manifesto in 2017 said a first-principles review, I think the sector was very encouraged by that, because they thought that they were going to get back to where this bill began in 2004-05. But, sadly, that has not happened.

The Minister has already stated, in some of her media, that she intends to have a fuller review after this bill has been implemented, but I would argue: if the Minister already acknowledges that a fuller review is required, why are we wasting Parliament’s time with this piece of legislation? Because it could end up being completely irrelevant after another review. Are we not better to invest Parliament’s time, the work of a select committee, in getting the bill right the first time?

The Minister has mentioned appeals processes, and I’d just like to touch on that. It does extend the time for appeals, and it is going to go to the Taxation and Charities Review Authority, but that is coming at a cost. It’s going to cost the Ministry of Justice $439,000, according to the regulatory impact statement (RIS), for them to deliver that service. It’s going to cost upwards of over $200,000 to appoint two new board members and provide the secretarial support, according to the RIS. So there is no free lunch here; obviously, there are going to be costs. But, also, even though the appeal can go to the taxation and charities review, it can then end up with the same decision being made, which means that it ends up in the High Court anyway. They have 20 days to deliver their second appeal, but at the moment, on current stats, appeals to the High Court are taking at least 12 months. So this could, in fact, end up being worse.

I’d like to end my contribution by quoting Dame Cindy Kiro, Governor-General of New Zealand, who, in her speech at the Queen’s memorial on Monday, said, “In her 70 years of service in her role as Sovereign, the Queen supported over 600 charities whose work provided comfort to the lonely, the sick, and the marginalised, and helped to protect our environment.” The late Queen would expect us as legislators to be supporting charities. This bill will not achieve that goal. National will not be supporting it.

Thank you, Mr Speaker. It’s a great pleasure to speak on the Charities Amendment Bill. I want to acknowledge the Minister, the Hon Priyanca Radhakrishnan, who has brought this piece of legislation to the House, both for her service to this country—working in many charities in the work she’s done prior to coming to Parliament—and also for progressing the bill today.

I am really delighted, having operated and run a charity myself—Tauranga Women’s Refuge—for a number of years. I had the experience of having to go and speak to Admin & Accounting Solutions in Tauranga who were our bookkeepers, the people who cared for us and worked for charities in a really good way. They helped me file for what was a very small amount of money that we were responsible for. It was a large process, and, of course, now this Government has funded Women’s Refuge in a different way and so, of course, they will have a lot more compliance, and they rightly should because this Government has given that money to them.

Anyway, charities are very important, and this bill, very briefly, is going to alter the primary legislation by making practical changes to support charities to continue their vital contributions—and some of us still volunteer our time. It reduces the compliance of small charities. It improves the process for charities to object to decisions. It requires the regulators to publish those decisions and consult with the sector on guidance. There is enhanced transparency, fairness, and accountability of the regulatory decision-making process.

I am hopeful that the sector fully engages. I look forward to working across the House and with many from the community in regards to this piece of legislation. I’m very pleased the bill is coming to the Social Services and Community Committee. I commend the bill to the House.

Thank you, Mr Speaker. It’s a pleasure to be talking on the first reading of the Charities Amendment Bill. This is a new bill put up by the Minister the Hon Priyanca Radhakrishnan. I’m not sure how many bills she’s put up, but—

Hon Michael Wood: More than you.

ANDREW BAYLY: —no doubt it is good. I’ve had two bills, Mr Wood, go through the House, so I may or may not have had more than the Minister, actually, but thank you for that little snarky comment.

We will be opposing this bill, as my good colleague noted. Of course, this is a really important piece of legislation because it is a really important set of organisations who do fantastic work in our communities. It’s interesting, you know: 114,000 not-for-profit organisations spread across New Zealand, taking in just under $20 billion of income and paying out most of that, just over $18 billion, in terms of supporting vulnerable New Zealanders, and, obviously, quite significant assets that underpin it.

But it’s interesting, looking at the breakdown of charities operating in 2021, by far the biggest component was education, training, and research—just under 6,000 charities, Mr Speaker, and I know that you have a very close association with some of these charities. Religious activities, Mr Speaker, was the next highest component—and, again, I know that you have a very strong interest in some of those. They’re about 5,000. Then you start going down through arts and culture, community development—health, actually, is amazingly low at only 2,000, which I am rather surprised about, especially given the dire and perilous state that we find our health system in today after five years of shocking mismanagement and restructuring by a Government who shouldn’t be restructuring anything in the middle of a COVID crisis—but let’s move on. Social security, sport and recreation, and then it pretty much drops off after that. I think it employs about 160,000 people. They’re hard-working people who freely give their time to their communities, and we should welcome and celebrate them for what they do for our communities.

This bill should’ve been a substantial change, and, unfortunately, we’ve ended up with a tweak. I think that’s wrong, and I suspect many people in this House are disappointed that what was previously set out as a major plank for the 2017 election for the Labour Party turned out to be a whimper. This so-called first-principles review—

Maureen Pugh: Where is it?

ANDREW BAYLY: Yes, Ms Pugh, I’m not sure where it is. I don’t even know where to find such a thing. But that’s what should’ve happened in this bill, because it is so important, as I’ve said before. That first-principles review, according to the manifesto, if I’m not mistaken, was going to be undertaken by an independent sector or expert in the charities sector. Well, what we get—ha, ha! We got the Department of Internal Affairs, who, basically, already are overseeing the activities of the charities sector anyway. So that’s sort of like saying, “Let’s go and review ourselves.” I find this amazing. So the first-principles independent review has turned into a bit of a sham. I think if we had a more discerning Minister who knew more and wanted more, she might have said to that sector, “Let’s get this right.” It is a shame that it’s taken five years—half a decade—to get to this point where we can finally talk about this little bill. I think that is a missed opportunity—a huge missed opportunity. As my colleague Maureen Pugh said, we should’ve taken the time to get it right. I don’t know how much more time it should’ve taken to get right, but I’m sure Maureen Pugh, if she’s lucky enough ever to have hands on a portfolio like this, would get through it in a dose of salts.

There are some interesting things: the appeal process going to the Taxation Review Authority instead of the High Court. I think we should acknowledge the Minister. She talked about the appeal process taking up to two months. The big issue about that, of course, is we’ve got a bit of a backlog in the High Court—you know, that’s half a decade of mismanagement in the court system, unfortunately. It all sounds good—extend it to two months, but if you can’t get an appeal; you can lodge it, but if you can’t get an outcome for probably at least 12 months—

Maureen Pugh: Years.

ANDREW BAYLY: —if you’re lucky—years—putting it out to 12 months is probably impractical and probably unreasonable.

So these are the sorts of changes that, you know, look, sound good. Some people will look at it and go, “It’s OK.”, but I’m just not sure it’s going to deliver the quantum leap that this sector’s been crying out for. So it is with some regret that we have to oppose this bill. There’s no doubt we’ll work through the process during the select committee. Hopefully, we can knock it into shape—needs a bit of intellectual grunt, I think, which Maureen Pugh will bring to the part, and our other colleagues on this side. But let’s hope we can get to a better outcome so we don’t end up getting into a place where we are squabbling over it and not doing a good thing for a sector that does so much for so many people in New Zealand, all free of charge, of course. That’s why we need to get this bill right.

大家好。 Talofa, Mr Speaker. It’s always a privilege and an honour to speak in the House, not only as a member of the beautiful Ōtaki electorate but also as a member of the Social Services and Community Committee who will see this, the Charities Amendment Bill—

Hon Member: Hard-working committee.

TERISA NGOBI: Yes, very hard-working committee, absolutely.

We know that this bill makes practical changes to support charities to continue their vital contribution to community wellbeing while also ensuring that contribution is sufficiently transparent to the public as well.

I want to actually talk about some of the experience I have in this space. Having worked as a contract manager for Oranga Tamariki, supporting NGOs and charities through their contracting work, not only through what their contract looks like, not only through getting them more money—because we know that charities are run on the smell of an oily rag and lots of awesome volunteers—but also reporting on their contract obligations. And generally, like I said, they manage to do that, and do such a great job in our communities, supporting our people, with little to nothing in the kitty to do that with.

I also worked on the other side of that. I’ve worked as a volunteer, and in the charities space with NGOs as well, and I know there’s nothing more frustrating than being bogged down with mountains of paperwork—and the cost of that—when you know that you’re already under-resourced and trying to support your community. On top of that, instead of being out there supporting your community, you’re having to write these lengthy reports, often, and also finding the money and time to do that. So, instead of having to do that, the proposed changes in this bill will mean that for very small charities that will change. No longer will they be bogged down with mountains of paperwork and the costs of that; they can go out there, they can support our children, they can support our families, and they can support our elderly and do the work that they’re really good at doing. So, for that reason, I commend this bill to the House.

Tēnā koe. I rise on behalf of the Green Party to take a short call in support of the Charities Amendment Bill. And I thank the Minister, the Hon Priyanca Radhakrishnan, for bringing this bill to the House.

The Greens value a strong independent tangata whenua community and volunteer sector that contributes to our social, environmental, cultural, physical, spiritual, and economic wellbeing. Like others in this House, I’ve spent much of my life in this broad and wide-ranging sector on many committees, boards, and trusts. My first role was as treasurer of the Māori Women’s Welfare League, as a junior member in Dunedin at 15 years of age, and I’m currently listed on the register as being on the trust board of two charities, one of which is Tīwhanawhana Trust. That is for takatāpui to tell our stories, build our communities, and leave a legacy.

It has been a long road to get to this bill. When the Charities Amendment Bill was introduced in 2017, an earlier iteration, the Greens originally opposed it because it would have reduced appeal rights for charities. The relevant amendment was removed at later stages because of the concerns that were raised by the tangata whenua community and volunteer sector. The expansion of objection and appeal rights in this bill is therefore more aligned with our previous statements.

The submission process for the department’s review closed in May of 2019, and I would just like to do a shout-out to Sue Barker Charities Law, who we met with at the time, who consulted individually with over 200 organisations and key people. I’m sad to say that when that process was actually paused in May of 2020, they were relieved because it seemed like the bill was getting worse instead of better. The 28,000 or so tangata whenua community and volunteer registered entities affected by this bill have waited a long time. So we very much look forward to many of you taking part in this select committee process and making submissions. We want to hear what you have to say about it.

As my colleagues have identified, the bill makes practical changes that include enabling simpler financial reporting, especially from very small charities, to reduce the burden of unnecessary compliance; improving access to justice for charities in the appeal process that is more affordable and at scale—a small charity with hardly any money in the bank should not have to go to a High Court to get a decision—promoting transparency and fairness through enhancing the decision-making requirements for these charities; clarifying the role of officers supporting the governance of charities; and improving all of those regulatory compliance and enforcement tools.

The Greens welcome greater Government trust in recognition of the tangata whenua community and volunteer sector. We support having the Charities Commission, now the Department of Internal Affairs, focused on registration and tax issues, and balancing the encouragement of charitable donations against the risk of scam charities for tax avoidance.

In terms of the age thresholds identified in this bill, the Green Party youth policy acknowledges the mana and the mauri of young people. We accept the 18-year-old age limit proposed for at least one officer on a given charity, because it means 16- and 17-year-olds can still hold another or all of the remaining positions.

Finally, we are pleased that the approximately 60 percent of the estimated number of Māori charities, which are very small, will be affected by this. It will make their lives easier. They’ll have considerably reduced compliance and, hopefully, reporting that is better suited to their needs. We do acknowledge, though, that this is still a very Eurocentric framework that our Māori, our iwi, our hapū, and our whānau organisations are working within. And so we note things like how to deal with kōhā, principles of reciprocal obligation, are not really addressed in this bill. Those are things we will raise through this process. In the meantime, we commend this bill to the House. Kia ora.

Thank you, Mr Speaker. It’s a pleasure to rise on behalf of ACT to make a very short call on this, just to make some comments. As someone who’s been involved with charities over the past—and the present—I can definitely see the logic and the reasoning for a bit more trust in those smaller charities, and to ease the regulatory burden. Generally, less regulation can be a good thing—although, one thing the select committee is going to have to look at is the potential for unintended consequences with this, with the smaller charities shifting from one side of the fence to the other, so definitely some things there.

I’ll also use this opportunity just to acknowledge the many charities throughout New Zealand who were absolutely hammered by lockdown—and in terms of the fiscal impact, the organisational impact, and the effectiveness, that was a very, very tough time for them.

So, as others have canvassed, for smaller charities, this bill pushes for a simpler reporting framework. It provides a better appeal process, with a separate tribunal. And, I think, unlike our friends in the National Party, our position is that we would like to see this go to select committee, so we will be supporting it, because we’ll be very interested to hear what stakeholders think about this, and then we will assess our position from there.

I acknowledge others’ feedback that this is, based on what the scope could have been—what it could’ve done for charities—probably not quite there, but, in terms of the significance, that is something that we can work out in select committee, I hope. So, with that—as I said, it’ll be short—I commend the bill to the House.

谢谢, Mr Speaker. It’s an honour and a privilege to stand to make a contribution to the Charities Amendment Bill. I want to acknowledge the Minister Priyanca Radhakrishnan for her contribution, and, in doing so, I want to acknowledge where she had said there are over 28,000 registered charities here in Aotearoa. Last year, it was reported that the equivalent of more than 145,000 people were working full time in the charitable sector. On top of that, close to 50 percent of all New Zealanders volunteer either in an organisation or directly in the community. So I want to, along with the Minister, echo acknowledgment of everyone in the sector who is doing really great work.

The bill: this bill keeps the current registration, reporting, and monitoring framework of the Act intact because these fundamental aspects are sound. However, the changes—the bill makes practical improvements in reporting requirements for small charities, the appeals framework, governance requirements, and regulatory decision-making and compliance tools. It will ensure the legal settings are up to date, fit for purpose, and will support charities to get on with their important work while also safeguarding public trust and confidence in the sector.

One of the most significant changes of this bill is introducing a new appeal body for the charities. So this authority will be faster, less formal, and cheaper than the High Court. Charities can represent themselves, which reduces legal costs and they will have two months to launch an appeal rather than the current 20 working days.

Along with the Minister, I urge all the charitable trusts and community organisations to please submit to the select committee, particularly the P.A.C.I.F.I.C.A. Inc. women’s group and all the churches out there. Thank you for your work. I commend this bill to the House. Mālō, Mr Speaker.

I think it might be my turn. It’s a pleasure to take a short call on the Charities Amendment Bill of 2022. I want to go back to 2005—well, actually, earlier than that; to 2004—and I remember the consultation on the initial work done on the 2005 charities bill. There was a lot of consultation with communities on it, and I remember particularly two meetings in my part of the world—one in Ashhurst and one in Fielding. And it shows the significance of this bill and the impression it made on me because I can still remember them, which is quite frightening.

Dr Duncan Webb: You can remember Ashhurst?

IAN McKELVIE: Ha, ha! I can remember the meetings—the very meetings.

DEPUTY SPEAKER: Sorry, Mr McKelvie. I just need to remind you this is a five-minute call, not a 10-minute call, which I’m sure you’ll have no problem filling.

IAN McKELVIE: I hope you’ll give me a couple of minutes as a result of the interruption, Mr Speaker, ha, ha! The point I’m going to make is that there was significant community consultation undertaken on that Act. It came back to the select committee, and the select committee completely changed the Act as a result not, I think, of the consultation, actually, because what was consulted on and what was sold to our communities was what the Act was going to look like. When it came back to Parliament in 2005, it was a totally different beast.

And the point I’m making is that we’ve got 28,000-odd charities in New Zealand, many of whom have well-resourced boards, well-remunerated boards, and well-remunerated staff who can deal with issues that Government put in front of them very easily, but thousands of these charities are very small entities—they’re either offshoots of Lions clubs or rugby clubs or community groups or little entities in our communities—who have no resource and no ability to deal with complex and complicated reporting methods and things like that that we put in place to sort out the charities in the initial reading of that bill. So, again, my point is that there’s a lot of work, I think, to be done, and I guess I’m saying that I think much more work needs doing in this area than has been done in the course of this bill.

The National Party have said they’re opposing it. And one of the reasons we will be opposing it is because of that very reason: the fact that we haven’t got into this deeply enough and we haven’t resolved the challenges—and the significant challenges—that face the vast variety of charities in our communities. I think some of the charities, in places like in our smaller communities particularly, they’re very small entities who do a much, much greater amount of good than you would imagine in those communities. And the onus on them is challenging and, at times, difficult for those people operating those charities to operate—to, I guess, comply with the level of compliance we insist on putting on them. So what I’m saying is I think there’s much more work that needs to be done around the Charities Act, and it will take a significant amount of work to do that—much more work than the select committee will be able to do on this.

We’ll be interested to see what the select committee gets in the way of submissions on this—I think it will be significant and I think a lot of them will be out of scope with what’s proposed in this bill, for the very simple reason that I mentioned a minute ago, and I think there’s much more work needed on this bill. I think the select committee will turn up a whole lot of issues that will be very interesting and will point clearly to the shortcomings that are contained in the current Charities Act 2005.

So I think it’s a very important sector for our communities; I think it’s a very important sector for New Zealand. I think there undoubtedly are some charities that shouldn’t be charities, and there undoubtedly are some charities that are penalised by the Acts we’ve put in place that do great work in our communities. So it’s a very hard balance to get, but I do think that the process will turn up some really interesting information and I think that the select committee will have a battle on its hands getting to a point where it can, I guess, moderate this piece of legislation to be something really useful. So it’s a massive task—a very small bill, really, but a massive task and I wish them all the best.

Dr Emily Henderson: Mr Speaker?

Dr Duncan Webb, I think, got to his feet just a little bit quicker.

Mr Speaker, thank you—it’s so competitive on this side of the House. We’re so keen to speak on this legislation to improve charities. I was particularly interested in Mr McKelvie’s view that there are some charities out there that shouldn’t be charities. I found that interesting, but certainly I think I would share the sentiment that there are some organisations of charitable status out there that need to examine their behaviours and make sure they’re acting consistently with their charitable purposes.

Sometimes an organisation can lose sight of those charitable purposes in the hurly-burly of delivering services that may be not-for-profit but, really, we’ve got to make sure that charities have the tools at their disposal and the structures and understanding of how the law’s supposed to work, so that that they can constantly review their behaviours against appropriate standards in the charitable sector. And that’s one of the big changes that this bill makes.

Now, obviously it’s disappointing that the National Party hasn’t chosen to support this bill, but I’m sure they’ll be constructive when they come to the select committee and bring their expertise in this sector from across the country. It is important that we get as much scrutiny of this bill as possible so that we can strengthen this important sector of our community. Kia ora, Mr Speaker.

谢谢, Mr Speaker. So enthusiastic am I to commend this bill to the House that I was somewhat ahead of myself earlier, and I do apologise.

I first want to thank the Minister for bringing this important piece of work to the House. Charities are a significant feature of our lives and, in particular, in the mental health sector. From my early teens, I grew up in the back room of one such charity—the Miriam Centre, a child and family abuse centre set up in Whangārei by my mum. Over the years, I have watched the complexity of regulatory demands on charities, often taxing and stretching people already stretching to cover the needs of the people they are there to serve. Simplicity and ease of operation is key to ensuring that charities can do their vital work with confidence.

I am looking forward to reviewing and strengthening the bill as part of the Social Services and Community Committee, a committee which has within it already considerable personal and professional experience of charities, as described by Angie Warren-Clark and Terisa Ngobi before me. I would strongly encourage the public and the charity sector to have their say, even if that means personally. Select committee hearings will, for me, turn into “Bring Your Mum to Work Day”. I commend this bill to the House.

Thank you. It’s said that charity begins at home, and that means a person’s first responsibility is to meet the needs of their own family and friends. So this Charities Amendment Bill is an amendment to the initial Charities Act 2005, which was, again, amended in 2012. So the Act’s been in place for 16 to 17 years, last amended 10 years ago.

Charity begins at home. I’ll come to speak to the bill, but just on that key point, this is about charitable organisations and the provision of goodwill, and contribution of services to meet the needs of their own within communities. In the general debate today, there were constructive comments and there were reality checks made about how the Government ought to be providing charity by addressing the needs of our community, in the interests of our people at home. My colleague Chris Bishop talked about the homelessness that we have in this country and the reality check, despite the comments from the Government benches, of a pessimistic outlook from the Opposition benches. The reality check is: that is life in the hardship of New Zealanders—charity begins at home.

I turn now to the Charities Amendment Bill. It’s interesting because there has been a 127-page regulatory impact statement, which I’ve endeavoured to read in the last couple of hours, but I do turn to some key critical points about that. The context of this bill is—I’ve talked about 2005 when the Charities Act was passed; it was amended in 2012. Prior to that, there was no register of charities and no consistent information about their activities and funding. Then, further in, the regulatory impact statement, a 127-page document, talks about the engagement of the Department of Internal Affairs with public consultation in 2019 consisting of 27 community meetings held across the country that 1,200 people attended, an online presentation was viewed 650 times, and there were 364 written submissions. There are approximately 28,000 registered charities in New Zealand out of over 114,000 non-profit organisations. This is our community and voluntary sector. Charity begins at home and is in our communities.

So approximately 28,000 are registered under the Charities Act. My point is that the stakeholder engagement commenced in 2019—the department reported back in 2021 that it conducted targeted consultation with representatives from the sector but that there were limitations in relation to that. One of the key findings that came out of the report—and for people who are interested to read that, it’s identified at page 14—is that “First principles issues have been excluded from this work, including some issues that were raised by submitters in 2019.” Those first-principle issues importantly include an examination and redefining of what “charitable purposes” are, under section 5 of the Charity Act 2005. That has been totally deemed out of scope by the Minister, in terms of the review and the consideration of amendments to this bill—there’s the first limitation, the oversight by this Government, factoring in and taking into account the engagement with the public and the community in 2019, by already limiting the scope of the revision of this bill.

So that’s really important, and that’s why the National Party does not support this bill. But, in saying that, by not supporting the reality—reality check is, this is going to select committee, where it will be examined and scrutinised by the Social Services Committee, on which the National Party is represented by my colleagues Maureen Pugh and Louise Upston. So the Minister, in addressing the House earlier on, has talked about the critical elements that will be examined. The most critical element is that the scope of this bill is limited. My colleague Maureen Pugh addressed the House and the importance that the National Party—we value our voluntary sector; we value the work that is done in this important charitable space. However, we also value the commitment and honouring of promises that have been made. The Labour Government included a first-principles review of the Charities Act in their 2017 manifesto. Regrettably, we’re not seeing that evidenced out. Intent and goodwill is all very well and good; we need to address the substance and the substantive issues that are impacting on our communities.

In typical fashion, the Government has failed to deliver on that promise. Here we are, before the House, striving to hold the Government to account. This bill will go to the first level of scrutiny at select committee, then it will get reported back to the House. But how much? Again, because the reality is—reality check, New Zealand public—select committees are weighted in favour of the Labour Government. Despite submissions that are made from the public, despite the representation and advocacy made from the Opposition benches in support of the public’s views, the Labour Government has an intent and an intention on matters that it brings before the House. So, yes, it will be scrutinised—it ought to be, appropriately. But will the Government be accountable and listen to the public with the concerns that have been expressed? The public consultation was in 2019. Thus far, it’s not been evidenced in the scope and with the proposed amendments in this bill before the House.

In concluding, I said that charity does begin at home. I invite members in the House to debate and address the issues in the bill. Charity begins at home. I’ve heard some uncharitable comments in this House as members have spoken to address this bill. So, on that note, the National Party, regrettably—and the reason we do opposite this bill is because the scope isn’t addressing the significant, critical, substantive changes that are required to make better, to improve not only the legislation but how that impacts on our people, our families, our communities. The National Party and I, as I stand as the last speaker for the party and my colleagues, oppose this bill. I do invite the Labour members sitting on select committee to factor in and heed what our public is saying. Although the scope’s been limited, this seems to be a foregone conclusion. The National Party regrettably opposes this bill in its current form because it’s scant, and it’s missing significant, substantive factors.

谢谢, Mr Speaker. It’s a real pleasure to speak on this first reading of the Charities Amendment Bill, and I’d just like to congratulate Minister Priyanca Radhakrishnan for bringing the bill to the House—it’s a wonderful bill.

Before speaking today, I had a look on the web and went through the Charities Register and just looked at the huge number of charities that are operating in New Zealand. It was amazing to see how many of them were bringing in hundreds of millions of dollars, but then some only bringing in a few thousand each year. So we’ve got a huge diversity in terms of the scope of charities operating in New Zealand and the financial size of each of those entities. Also, going through the names of a lot of those charities it was interesting to see how many of them we relied on for aspects of our daily lives. So we had academic institutions, we had churches, we had rotary clubs, we had animal rescues, and we even had highland pipe bands. So just a huge diversity of things in terms of the charities, in terms of the work that our communities rely on. We rely on good charities to deliver the services that our communities need, but we also rely, in many cases, on the work of the volunteers. They put in many, many hours to make sure those charities can deliver the benefits that they have been developed to do so.

Looking at the Charities Register, I think what it does is it maintains public trust in these charities. I think that’s really important, because if you’ve got information that’s publicly available, then anybody wanting to sit down and think, “Can I volunteer for this charity? Do my views and my beliefs align with what they’re doing?”—if they’re wanting to volunteer, if they’re wanting to donate, but also if they’re wanting to use the services of the charity, they can actually go online and have a look at all their contact details. You can have a look at what they’re doing in terms of the work, and you can also have a look at their financial position. I think that’s really important. For many of the organisations operating in our community that’s really useful information that we can have on their work.

I also think it’s important to acknowledge—and that’s what this bill does—that charities are often run by volunteers who have limited amounts of time but absolute passion for the work that they do. And in many cases, the financial documents that they need to put in place are actually quite disproportionate to the scrutiny that’s required. I think that’s the thing that we need to weigh up, and I think what this bill does is it looks at that balance. I’m really looking forward to hearing submissions on this during the select committee process, because it’s important to be thinking about what is the basic amount of information that we need to make sure that the transparency and the accountability of the charities is there, but also thinking that what we don’t want to do is unduly take up the time of those volunteers when they should be out there in the community doing the important work that they do.

One of the things the bill does is it enables simpler financial reporting for very small charities so that it can reduce their compliance burden. I think what we’re looking at here is the capacity to have regulations that can provide a lot more detail around who those smaller charities are, and then be thinking about what it is that we need in that respect to be able to provide the information we need. So what that will mean is that those charities, if we get that right, can spend a bit of time on their financial reporting, but they can spend most of their time out there in the community doing the work that they love.

Another issue that we’ve got is, again, coming back to thinking of these charities and the work of volunteers, many of whom, like I said, are busy doing other tasks and also have limited resources. And if you want to get access to justice to have appeals, if the charities want to appeal decisions of the Charities Registration Board, then, at the moment, what they have to do is they actually have to go to the High Court. Anybody that’s been through a court process will know that not only is that incredibly costly, it is incredibly time-consuming; there can be delays in terms of being able to get access to your case being heard. What this will do is it will enable a charities review authority to be able to hear those appeals in the first instance. It won’t mean that people don’t have access to the High Court, and, indeed, you know, the Taxation and Charities Review Authority may well refer the case on. But what that means is that, in a much more simple and a much more affordable way, charities will have access to being able to appeal and have those issues considered.

So I think this is a really, really important bill, and I think it will allow charities to, as I say, get that balance right between what they have to do in their financial reporting and also what they can do in terms of the work that they do. I think the select committee process is incredibly important because what I’m hoping is that many charities will come and they’ll discuss how the bill will relate to their situation. Because, as I said, when I was looking through the register, what we’ve got is some of those very large academic institutions who are doing some amazing research. We’ve got other organisations, churches, rotary clubs. They’re going out there in the community, but their needs are very, very different and their reporting needs are very different. And I think the other thing is that for people wanting to access the services of those charities then, basically, that reporting requirement is very different.

So I think this is a really important bill and it will provide that extra support for charities to be able to get that balance right and think about where they want to go next. There’s a range of other issues that are covered in the bill, some of them are minor and technical; some of them are more substantive. But I think this is a really significant bill, and I’m looking forward to hearing submissions during the select committee process. I commend this bill to the House.