Background Guide to Senate Inquiry into Charities
28 July 2008 at 3:04 pm
The Senate Economics Committee has released a Background Paper for the Charities Inquiry – outlining some of the issues around governance and disclosure regimes in the Not for Profit sector.
The Senate Committee says the Paper is intended to provide guidance to individuals or organisations considering making a submission to the inquiry on the types of questions and issues that the inquiry is likely to grapple with.
It says a number of concerns have been express about the way in which the Not for Profit sector operates in Australia. These include:
– a lack of transparency about the way in which public or donated funds are spent; and
– lack of accountability, despite the fact that the not-for-profit sector is a major
provider of services to the public.
The Paper sites a survey conducted by Choice Magazine which found that 81% of respondents did not know what proportion of their charitable donation reached their favoured charity’s beneficiaries, yet 94% considered it important to have access to that information. The survey found wide variability and inconsistency in the way that charities communicate key information to donors. In some cases, such information was not publicly available at all, as some charities did not publish their annual reports or financial accounts.
Other issues include calls for regulatory reform including a national regulator.
The Paper looks at a proposal for simplifying Not for Profit entities by former Democrat Senator Andrew Murray.
He proposed that consideration be given to establishing a simplified regulatory framework to apply to both Not for Profit entities, including charities, and small for-profit businesses, with the regime to be administered by a Registrar of Incorporated Organisations.
The Senate Committee says it is not its intention to limit the inquiry to just the issues that are raised in the Background Paper and welcomes any submissions that address the terms of reference.
Submissions will close on 29 August 2008. The Senate Inquiry is due to report its findings and recommendations at the end of November 2008.
The Background Paper can be downloaded at: