Morrison government unveils ‘significant and far-reaching’ fundraising reforms

A new fundraising model is set to reduce the administrative and financial burden for charities     

Sector leaders are celebrating a major win in the battle to fix fundraising regulation, with the Morrison government announcing a deal has been signed to harmonise charitable fundraising laws across Australia. 

Treasurer Josh Frydenberg and Assistant Minister for Charities Zed Seselja revealed on Tuesday that all states and territories have agreed to simplify fundraising laws so charities no longer have to register in multiple jurisdictions when raising funds nationally. 

Under the deal signed by the Council on Federal Financial Relations (CFFR), a cross-border recognition model will be established – which was first flagged in September – providing a single registration point for charities.

This announcement represents a major victory for the charity sector, which has long fought to reform Australia’s inconsistent and outdated fundraising regulations, which cost the sector an estimated $13.3 million a year.

It comes after the bushfire royal commission recently recommended setting up a single national scheme for charity fundraising as a way to reduce red tape and donor confusion in times of extreme crisis. 

Seselja said he was proud to be able to deliver this result for the sector.  

“These are the most significant and far-reaching reforms of this sector in recent years,” Seselja said. 

“By cutting unnecessary red tape and reducing the administrative burden, our charities are able to get on with the job of supporting vulnerable Australians.” 

Leaders from across the sector have welcomed news of these reforms.

Fundraising Institute Australia (FIA) CEO Katherine Raskob said adopting this model will reduce the administrative and financial burden for charities and help strengthen the fundraising sector going forward. 

“This is a fantastic and much-needed step on the road to real reform via harmonisation of state-based regulations for which FIA have been advocating for many years on behalf of its members and the sector,” Raskob said.

“FIA believes that by working together, government and the charitable fundraising sector can continue to drive real reform to achieve our aims.”

Dr Jane Rennie, the general manager of external affairs at CPA Australia, told Pro Bono News she was pleased the government has finally acknowledged the need for comprehensive fundraising reform. 

“Australia’s fundraising regime has been plagued by dysfunctional requirements over many decades which have created uncertainty, burden and unnecessary costs for charities and not for profits, and ultimately reduced the amount available for charitable purposes,” Rennie said.

“These reforms are long overdue and will come as a relief for the charities and not-for-profit sector and accounting professionals who support it.”

The Australian Council of Social Service labelled the announcement a welcome first step towards the ultimate goal of comprehensive fundraising reform.

But CEO Dr Cassandra Goldie added that more work needed to be done.

“Substantial reform to fundraising regulation has been recommended by multiple reviews, inquiries and a royal commission,” Goldie said.

“Despite this welcome proposal, there is still significant work to do to comprehensively reform the hodgepodge of fundraising laws that apply to charities across Australia.”

Community Council for Australia CEO David Crosbie agreed. 

He told Pro Bono News that while he was pleased to see this breakthrough, action now needed to be taken urgently. 

“It is now clear that fixing the dog’s breakfast of fundraising regulations in Australia is a priority for the [government],” Crosbie said.

“Now we just need to get it done and not continue to delay reform.”

The Morrison government has also announced that the CFFR has agreed to develop a framework by mid-2021 to lift the financial reporting thresholds for more than 5,000 small and medium charities.

This will simplify financial reporting requirements for these charities and is expected to save them thousands of dollars a year.

Jurisdictions will announce a commencement date for these new thresholds by July next year with legislation expected to be in place by the end of 2021.

The shadow assistant minister for charities, Andrew Leigh, criticised the government for condemning charities to “another costly year”. 

“The prime minister and treasurer have finally woken up to their responsibilities, but this will see charities and not for profits facing another year of outdated fundraising laws,” Leigh said.

“And another year means another $15 million hit to a sector that’s already running lean… Australia’s charities should not be forced to wait any longer.”