Tizard Judith: Charities Bill — Second Reading Instruction to Committee In Committee Third Reading 
Tizard Judith: Charities Bill — Second Reading Instruction to Committee In Committee Third Reading 
[Volume:625;Page:19973] 
Hon JUDITH TIZARD (Associate Minister of Commerce) 
: 
 I move  
That the Charities Bill be now read a third time 
. The passing of the Charities Bill into law will allow the new Charities Commission to be established. That is a first for this country and will further demonstrate that this Government has an ongoing commitment to strengthen its relationship with the charitable sector. 
Many people in the charitable sector will remember the idea of a charities commission being floated as far back as 1989 with the release of the Spencer Russell report. It recommended that a commission for charities be established to register advise and supervise charities. While the timing was not right then for such a commission to be established the sector has continued to ask Governments to provide greater support. 
One of the Government’s primary forms of assistance to the sector is the provision of certain income tax benefits for charities and for people who make donations. Over recent years the charitable sector has asked the Government to increase the level of support provided to it through the taxation system by lifting the maximum rebate level for people who donate to qualifying donee organisations and by making charitable organisations’ imputation credits refundable. It has traditionally been difficult for any Government to assess how much that an increase in those forms of assistance would cost. That is because robust information about the size and scope of the charitable sector in New Zealand has traditionally been difficult to collect or access. In addition to there being little information collected there is no specific law standard procedure or Government department concerned with ensuring the accountability of organisations that receive donations in cash or in kind. 
The reporting requirements currently imposed on charitable organisations are minimal. While some income-generating charities might need to file a tax return the Commissioner of Inland Revenue’s role is to ensure that income not entitled to an exemption is taxed. The role is not about ensuring that the charitable sector is generally accountable to the public. Holding the officers of a charitable organisation to account for an organisation’s administration expenses for example is well beyond the ambit of the commissioner’s current responsibilities. It is also not the role of the Registrar of Incorporated Societies. 
The establishment of the Charities Commission will significantly improve the current framework under which charities operate. It will provide the Government the sector and the public with more comprehensive information about the charitable sector. From the Government’s perspective that information will be utilised to assess whether its support for the charitable sector is as well targeted as it can be or whether changes should be made 
For the sector the information on the register is likely to prove to be useful in a number of ways—for example as a means of tracking funding trends within the sector which may help organisations to develop more effective fund-raising campaigns or for determining what service providers are established in a particular locality. The creation of the commission will also allow the public to undertake closer scrutiny of all organisations purposes and activities and the way in which those are delivered to the public. It should help to increase public trust and confidence in the charitable sector. 
The establishment of the commission is not just about increasing the sector’s accountability to the public; it is also part of the Government’s wider strategy to strengthen its relationship with the community and voluntary sectors. While the commission will have a registration and monitoring role it will also have a range of other functions that will allow it to be active in helping to build an effective and efficient charitable sector. That includes the ability to educate and assist organisations about management and governance issues and the ability to make policy recommendations to the Government on its own motion. 
One key area of concern to the sector as evidenced by the submissions made to the Social Services Committee is the current definition of “charitable purpose” used across the New Zealand statute book. Once established the commission will be able to provide policy advice to the Government about the continued workability of the definition and whether it needs to be updated or left as it is. 
Leaving that review for the commission to undertake will allow the review to be better informed than might otherwise be the case. The charitable sector is diverse and because of that it has been difficult to gather information from and consult with all interested groups. Having a single register of charitable organisations operated by one agency will make it much easier for the charitable sector to become informed about respond to and comment on issues specifically affecting it. 
In concluding I thank the members of the Social Services Committee the officials from both the Ministry of Economic Development and the Office of the Community and Voluntary Sector and the large number of organisations and individuals who made submissions on this bill. Charities make an important contribution to the social well-being of many New Zealanders by providing valuable services that help to strengthen and support local communities. The Government recognises and values that work. 
The Charities Bill is a significant step forward for the New Zealand charitable sector. As a means to increase the sector’s public accountability and transparency it represents a positive move toward helping to develop a culture of philanthropy and giving in this country. The establishment of the commission is one of a number of projects that the Government is advancing to strengthen its relationship with the community and voluntary sector. The passing of this bill will help to ensure New Zealand’s charitable sector is able to operate effectively and efficiently to deliver necessary and important services for the betterment and benefit of our communities. I commend this bill to the House.