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David Bradbury

Assistant Treasurer, Minister Assisting for Financial Services & Superannuation and Minister for Competition Policy & Consumer Affairs

5 March 2012 - 18 September 2013

Media Release of 29/05/2013

NO.093

Joint Media Release with
The Hon Mark Butler MP
Minister for Social Inclusion

Statutory Definition of Charity Legislation Introduced into Parliament

The Gillard Government today introduced legislation into the Parliament for a statutory definition of charity.

"The meaning of charity and charitable purpose has largely been administered on the basis of principles derived from the common law, going all the way back to the Statute of Elizabeth of 1601," said Assistant Treasurer David Bradbury.

"A statutory definition of charity is a sensible and evidence based reform, which has been recommended by numerous reviews such as the 2001 Inquiry into the Definition of Charities and Related Organisations, and the 2010 Productivity Commission report, Contribution of the Not-for-Profit Sector.

"The proposed statutory definition aims to preserve the existing common law definition with some minor variations, and will help support charities by providing a succinct and clear definition of charity which is easier for charities and the community to understand."

The not-for-profit sector has been widely engaged in the development of the definition with over 200 submissions on a public consultation paper in 2011 and further consultation on the draft Bills. The Government has been very responsive to issues raised during the consultation process, including in the most recent consultation.

"The Government appreciates the extensive and significant contribution of the sector to the development of the definition and thanks all stakeholders for their valuable input," said Minister for Social Inclusion, Mark Butler.

"Their contribution will help ensure the definition supports and facilitates the important and significant contribution that charities make to the Australian community."

The proposed start date for the statutory definition of charity will be 1 January 2014.

Further information about changes made to the legislation in response to stakeholder feedback and input on the draft Bills is outlined in the attachment.

29 May 2013


Attachment

Key changes included in the final Bills, mainly as a consequence of stakeholder input and feedback during public consultation on the draft Bills, are set out below.

  • the inclusion of a Preamble that acknowledges the distinctive and important role of charities in the Australian community, outlines the benefits of a statutory definition of charity and charitable purpose, and states that familiar common law concepts are being used to ensure continuity;
  • clarification of the definition of government entity by including an example to provide further information about the State and Territory entities intended to be captured by the definition (see section 4);
  • changes to how the public benefit requirement is described, to ensure it remains consistent with common law principles (see section 6);
  • the description of purposes presumed to be for the public benefit has been broadened to more closely match descriptions of purposes in the Report of the Inquiry into the Definition of Charities and Related Organisations (see section 7);
  • purposes presumed to be for the public benefit are specified under the broader categories of charitable purposes where their link to the broader categories was previously unclear (see section 12 and Part 3 of Division 2);
  • the inclusion of an exemption from part of the public benefit requirement for the purpose of relieving the necessitous circumstances of one or more individuals who are in Australia (see section 8);
  • refinement of the description of entities that hold or manage native title or other traditional land related assets (see section 9);
  • clarification that charities are free to critique the policies of political parties and candidates, as distinct from direct partisan political engagement (see section 11);
  • clear provision for the ongoing status of existing charitable purposes that do not come under the specific categories listed in the Bill (see paragraph 12 (k));
  • minor changes to clarify the provision that allows funds to contribute to charity-like government entities and the provision relating to cy-pres schemes (see sections 13 and 18); and
  • grandfathering of existing charitable entities that provide for 'poor relations' and 'poor employees' (see Part 3 of Schedule 2 to the Consequential and Transitional Provisions Bill).