Charities Bill — Second Reading Instruction to Committee In Committee Third Reading 
Charities Bill — Second Reading Instruction to Committee In Committee Third Reading 
[Volume:625;Page:19940] 
Charities Bill 
Second Reading 
Hon JUDITH TIZARD (Associate Minister of Commerce) 
: 
 I move  
That the Charities Bill be now read a second time 
. The Charities Bill will establish a new Crown entity the Charities Commission. One of the commission’s functions will be to administer a registration reporting and monitoring system for charitable organisations. The intent behind establishing the commission is twofold: firstly to improve public trust and confidence in charitable organisations and secondly to obtain better information about the size and scope of the charitable sector. 
A number of changes have been made to the bill by the Social Services Committee and I will shortly outline the scope and intent of those changes. In addition the Ministry of Economic Development wrote to approximately 25 umbrella organisations and other entities to seek their views on the workability of the bill. On the whole the feedback from those groups was positive. In addition to the changes recommended by the select committee the Government reaffirmed its commitment to the charitable sector by announcing in October last year that it would commit $9.8 million in funding to the commission. That means for example that registration with the commission will be free for all organisations. 
The select committee has recommended that the bill provide for the commission to be established as an autonomous Crown entity. That removes the requirement for the commission to establish and maintain a separate register of approved donee organisations. That function will continue to be undertaken by the Inland Revenue Department. Operationally however most charities will deal with one agency. With the agreement of the donee organisation the commission will have the ability to provide the Inland Revenue Department with any information contained in the public register including information that has been withheld from the publicly accessible register for public interest reasons. The Inland Revenue Department will be able to assess whether a registering charitable organisation also qualifies to be recognised as a donee. The notable exception will be charities with significant international operations that also want to be donee organisations. They will need to work with the Inland Revenue Department or obtain parliamentary approval to be added to the list of recognised overseas donee organisations contained in the Income Tax Act 2004 as is the current process. 
The select committee has recommended significant changes to the section of the bill outlining the commission’s functions. Many submitters expressed a concern that the commission’s functions were too focused on its registration and monitoring role. To make the bill’s intent clearer the commission’s functions are now explicitly set out as providing education and assistance on matters of good governance and management to charitable organisations. The bill gives the commission the ability to provide policy advice directly to the Government about issues faced by the charitable sector. For example the commission may want to make recommendations to the Government about whether a new type of corporate legal entity for charitable organisations needs to be developed. Under the bill as it has been reported back the commission will monitor and promote compliance with the legislation. The bill also now gives the commission express responsibility for taking prosecutions for offences against the legislation in appropriate circumstances. 
In many of the submissions received concern was expressed about the definition of a charitable purpose used in the bill. The test used in the bill comes from case law and the select committee has not recommended that that test should be changed. What it has recommended is that the bill codify for clarity reasons the common law on non-charitable incidental purposes. Throughout the select committee process the single biggest concern raised in relation to the charitable purpose test was the position of advocacy and whether organisations that undertook advocacy work would continue to be classified as charitable and be able to register. The committee has recommended changes that make it clear that the commission will not prevent an organisation from being able to register if it engages in advocacy as a way to support and undertake its main charitable purpose. 
The bill has been amended to increase flexibility for registration. A national organisation can now register on behalf of a number of entities where those entities are affiliated or closely related to it. That will enable charities with complex organisational structures to register once if they so choose. The commission will also have the power to grant a waiver so that registered organisations are able to comply with their regulatory obligations and duties in a way that best suits the organisation concerned. For example a parent organisation with 29 branches around New Zealand will be able to register and each of its branches will be able to use the same registration number and will generally need to file one annual return form that covers the organisation’s entire operations. Where that is not possible or practical an organisation can request that the commission allow each of the 29 branches to file its own return. I also propose by way of a Supplementary Order Paper to extend the commission’s power to grant a waiver to cover the registration requirements for charitable entities. The commission could then allow an umbrella entity to file a single set of rules on behalf of the group. 
I wish to thank the members of the select committee for their work in considering this bill and I acknowledge the invaluable contribution of the many hundreds of people and organisations that took the time to make submissions and present oral evidence on the bill. During the Committee of the whole House I intend to table a Supplementary Order Paper that will make the following changes to the bill: consequential changes due to the enactment of the Crown Entities Act of 2004 minor changes aimed at improving the workability of the bill and three other changes. The first empowers the commission where it deregisters a charitable entity to specify a period of time within which that entity may not reregister. The second of those changes empowers the commission when it does deregister a charitable entity to also disqualify an officer of that entity from being an officer of a charitable entity for a period not exceeding 5 years. Those provisions are also consistent with the provisions of the Companies Act. The third change removes from the bill provisions that exempted the commission from the laws of defamation where it issues notices and publishes details of possible breaches of the bill and other serious wrongdoings. I consider that such provisions are inconsistent with the broad Government policy in the Crown Entities Act. Also there are no special reasons why the commission should be treated differently from other Crown entities. 
I commend the bill to the House. 
JUDITH COLLINS (National—Clevedon) 
: 
 I was a member of the Social Services Committee who looked at this bill and I heard a tremendous number of submissions from a lot of people who came along to give their time to talk about what a silly bill it was. But there was a good thing about that committee that Georgina Beyer chaired and she chaired it very well too I should say—I like to give credit where it is due; I do not often get the chance to give credit in this place. [ 
Interruption 
] Mr Hide asked me to say nice things and I tell Mr Hide that I am going to do that. 
One thing that happened was that the Labour Party members on the select committee were very shocked that everybody who came along to submit on this bill submitted against it. Those people submitted against it for the very reason that this bill which is called the Charities Bill is not particularly charitable. It is all about trying to remedy a wrong that does not actually exist. The Government of course thinks that the great wrong is that there is not enough money going into Government coffers or enough people being employed to regulate the ordinary everyday lives of people who volunteer their time and money—and many times their family’s work—to be able to help people in need. 
We know there are lots and lots of charities in this country. There seem to be thousands of them. Most charities are not huge organisations. Many charities are actually very small organisations and the provisions for charitable purposes have been determined by the Inland Revenue Department ever since there has been an Inland Revenue Department. There cannot be a more powerful body in this country than the Inland Revenue Department when it comes to having powers to investigate look at and take money out of people’s bank accounts wages and almost everything else. 
Yet this Government which is utterly driven by a politically correct agenda and utterly incapable of seeing the wood for the trees is utterly incapable—as Mr Tamihere has said—of being able to relate to ordinary New Zealanders who go about their business who do not commit crimes and who pay their taxes. The Government is utterly incapable of understanding that. This Government feels that any people in charge of any money not actually their own must be about to steal it. 
That is the way this Government has acted. It has acted by wanting to over-regulate those bodies to the point we found out that even someone like Sue Bradford who is a very good hard-working member of the select committee would not be able to be on the board of one of those charities because of her previous time as an almost professional protester—no not professional but a person who would have been protesting. 
Sue Bradford 
: Radical protester. 
JUDITH COLLINS 
: She was a radical protester as she likes to be called. Well this is a House of Representatives and everyone can be represented here even radical protesters. She is someone whom I would not mind having on a board I was on and I think she would be quite happy to be on that board but we found out that she would have been stopped by this silly Government that simply wanted to say it did not trust anyone. 
Now of course we have found out the real reason for it all. Apart from the fact that the Government wants to rip money out of the system and take money out of the little charities that pay for things like school uniforms or sports equipment for kids who need it and for poor schools in poor areas the Government wants to rip money out and control the system itself. The Government wants to get rid of those little charities and organisations. [ 
Interruption 
] I ask that member opposite who keeps screaming out why she did not give her speech as though it actually had some meaning. I really did think before that I should have been seeking a point of order and suggesting that maybe the Minister could stand up and be given the chance to redo her speech. But next time she should sound as though she means it because the speech she gave earlier sounded as though it had been written by some flunky who did not know any better. 
Of course we understand that this Government is so much better at talking about charity and about what it wants to do for people than it is at actually doing it. And there is no other example really that is quite as good at the moment as the example of the attitude of Government members in their charity towards Mr John Tamihere. That is certainly an act of charity towards Mr Tamihere—and it is one of those stunning acts of charity that the women members of the Labour caucus will stand by and support a man who has referred to them in such a disgusting way as Mr Tamihere did. Those members do not have enough in them to stand up and fight for their rights so they leave it to me—a National Party MP—to have to stand up for them. Well what sort of attitude is that? Fortunately I am a pretty charitable person and I am happy to stand up for them if they are too weak and emotionally crippled to be able to do it for themselves. I will stand up for them because they definitely need it. 
Peter Brown 
: Are you charitable to tossers? 
JUDITH COLLINS 
: Mr Brown is asking me whether I am charitable—and under this bill I am thinking in a charitable way—to tossers. Well I say to Mr Brown that it is not really a term I would normally use. I would not like to call any member of this House by such a term but unfortunately Mr Tamihere does. We have to understand that there is a certain amount— 
Rodney Hide 
: Who said “tosser”? 
JUDITH COLLINS 
: I think there are a couple of members who did but I tell Mr Hide that we will not go into that. 
I will seek in the Committee stage to bring about a change to some parts of the bill. One of the changes I will seek to deal with is the fact that the Charities Commission—which will of course be made up of Labour Party flunkies—will have to try to minimise compliance costs. We know as people who have been involved in small businesses that it is the compliance costs that grind people down in business and they will grind people in those charities down. Generally the people we are talking about are not people who are financial wizards. They are often mums and dads who help out at Scouts and all sorts of organisations like that. Yet here they are being treated in this bill as if they are some form of great big business. 
The compliance cost in the bill is something that Mr Tamihere has talked a lot about. He has said a lot about small-business compliance cost yet the Government will not see its way to be charitable towards the very people who spend their time and money raising money for other people—which is a very charitable thing to do. 
I cannot understand why this Government thinks that the Charities Commission will have more power and ability to deal with the deceit or criminal actions of people involved in charities than the Inland Revenue Department and the police have. We know there is a shocking shortage of police particularly in south Auckland and particularly in Manurewa which is in the Hon George Hawkins’ electorate. There is a shocking shortage of police there yet we have a bill here that says maybe that is why the Government is going to have a Charities Commission. 
We know that the Charities Commission will always be full of Labour Party flunkies while Labour is in power—but fortunately that will not last long—and we will see a huge amount of cost. We can just imagine how many trips overseas there will be for those commissioners to look at charities. How many little people will be paying for that? How many school uniforms will be lost because of those costs? How many people will be told: “I’m sorry; we won’t be able to fund your child going to Scouts this year because the money has had to go in compliance costs.”? Charities and the Charities Bill should be all about getting the money out to the people who need it not about building a huge administration in order to stop money going where it needs to be going. 
I think that almost every—in fact every—submission I heard on this bill was against it. Government members eventually listened to some of those views but what they could not get their head around was the fact that it was a bill nobody wanted except for themselves and their officials. 
Unfortunately the Minister who was previously in charge of this bill simply could not understand what was actually in the bill or how it would work. I understand that the Labour Government may have some trouble with understanding how charities work but if the Greens can understand it why can the Government not understand it? I mean everyone else here can understand it. 
The exception is United Future members I think who will do what they always do and help out the Government on anything tricky. That is a real shame because I have received submissions from interfaith people saying: “Please—we’ve got a bill here that’s going to set how we have a board. We don’t always have boards.” Yet the Government will be dictating through this Parliament who will be in charge of the very church charities that United Future says it is happy to support. 
In essence this bill is unnecessary. It imposes a load of extra compliance costs on charities and the money should be going where it is needed. 
GEORGINA BEYER (Labour—Wairarapa) 
: 
 I am very pleased to take a short call on the second reading of the Charities Bill. I will focus primarily on my gratitude to members of the Social Services Committee which I am proud to chair and which I chaired during the course of the hearings on this bill. I thank the members who served on the select committee: Dr Muriel Newman Paul Adams Sue Bradford the Hon Taito Phillip Field Bill Gudgeon Moana Mackey Katherine Rich Dr Lynda Scott the Hon Judith Tizard and Gordon Copeland. I also thank Judith Collins who on occasions was present as well. 
The committee received 753 submissions of which we heard 161 and we held hearings in Auckland over 2 days. It became very apparent to the select committee very early on in the hearing of submissions that some points were consistently raised by the submitters we heard. So we devised a list of the eight concerns most often raised by the submitters we had seen so that those who came after them could look at that list and agree that those were the points they had concerns about. That was provided particularly because of the very short amount of time submitters had to have their voices heard and it allowed submitters to get the best they could out of the process in that time. That was achieved because they were able to eliminate the eight points and go on to other matters that concerned them that they otherwise might have had little time to express. 
I believe that the select committee process worked as far as our democracy is concerned—to the point indeed where the submissions we read and heard had a profound effect on how the committee felt it should deal with the bill. As the Minister mentioned in her speech most if not all of the eight concerns consistently raised by submitters have been addressed and rectified in the bill that is before the House now. That should send a strong and clear message to New Zealanders that the select committee process is of value that what is of most value is their opinions and submissions on particular bills and that they are indeed listened to by members of select committees. Quite often we are told that they are not valued and that we do not listen to them. Well here is an example of a bill on which they were listened to and to which they added some significant changes—there has been a virtual rewrite of the original bill. 
In the House this evening we are on to the second reading of the bill and we will I hope speedily continue through to the Committee stage. I conclude by acknowledging the select committee again but also importantly the officials who worked with the select committee. They included officials from the Ministry of Economic Development the Inland Revenue Department the Ministry of Social Development—particularly the Office of the Community and Voluntary Sector—Treasury and the Parliamentary Counsel Office. They had hours and hours of work to do as the committee went through its considerations. 
Also I would like to acknowledge Gordon Copeland in particular. He of course worked some years previously with the working party towards what became a draft of the Charities Bill. I look forward to his speech later on. He will be able to enlighten the House and anybody who happens to be listening on the details and perhaps the gestation of this bill. With that— 
Darren Hughes 
: Oh no! 
GEORGINA BEYER 
: Well I should carry on; I am getting rounds of applause here. I wish the bill a speedy passage through the House. 
BILL GUDGEON (NZ First) 
: 
 Taking into consideration the serious concerns of the many charitable organisations throughout the country New Zealand First supports the intent of the bill. Clause 15 disqualifies a number of classes of people from serving as officers. New Zealand First supports in particular the exclusion of people who have been convicted of an offence punishable by a term of imprisonment of 2 years or more or of 2 years or less when a person has been sentenced to imprisonment. 
The Charities Bill establishes a new Crown entity the Charities Commission responsible for running a registration reporting and monitoring system for charities. It is also important to note that only those charities that are registered with the commission will be able to retain or gain tax-exempt status while any unregistered charities will not be income tax exempt. That will ensure that the sector becomes more accountable and transparent to the donating public and that fraudulent activities can be eliminated. 
New Zealand First believes that this bill will assist in the ongoing provision of important services to the community that confidence in the charitable sector will increase as a result of the activities of the Charities Commission and that this confidence will encourage the Government to consider a more generous tax rebate. 
What is the definition of “charitable purpose”? Part of the criteria for registration as a charitable entity is that the entity must be maintained for charitable purposes. The bill defines “charitable purpose” as including every charitable purpose whether it relates to the relief of poverty the advancement of education or religion or any other matter that would contribute positively to community advancement. 
The commission will have a number of enforcement powers available to it to address any situations involving deregistration. In the first instance the commission is more likely to use its lesser enforcement powers or its education function to encourage and help the charitable entity to comply with its obligations. 
New Zealand First believes that this bill will encourage more responsible activities and more accountability to public donors. It does not pose a threat to democratic process because it is only when laws are in place that democracy can function. The voluntary sector is much appreciated by New Zealand First for the service it renders to the general public. The sector’s independence is firmly in place without being jeopardised by the fly-by-nighters who as we are only too aware are getting a free ride under the guise of being charitable organisations. New Zealand First supports the bill because charitable organisations have been part of the landscape of New Zealand communities and are a reflection of a service-rendering society. 
During the hearing of submissions as the chairperson mentioned a list of eight points was agreed to by the select committee under the stewardship of the chairperson and with the supporting vote of the committee. The list reads: (1) general concern that compliance costs imposed by the bill will be onerous; (2) concern about the definition of “charitable purpose” that is used and the position of organisations that undertake advocacy; (3) the commission’s status as a Crown agent and its lack of independence from government; (4) the fact that registration numbers will need to be displayed on all correspondence and fundraising materials general concern about compliance costs of this; (5) disqualification of officers clause too onerous and may prevent people from volunteering to be officers; (6) inability to indemnify officers is too onerous and may also discourage people from becoming officers; (7) filing claims specified in the bill for providing information and annual returns to the commission are sufficient; (8) commission’s functions need to include a general education and support role and not be limited just to providing advice and support about regulatory duties and obligations. 
Listing those eight points assisted us to cut down the time spent listening to submissions. As submitters read those points they were able to get past them. I now realise that the bill covers those points to the advancement of charitable organisations in the country. I am sure that many submissions listed concerns outlined in the list I read out. Those submitters will now be happy with the result in the final bill. 
New Zealand First has concerns but we are looking at the overall picture of charitable organisations throughout the country. We support this bill to the House. 
RODNEY HIDE (Leader—ACT) 
: 
 I rise on behalf of the ACT party to oppose this bill. It surprises me that New Zealand First is supporting it. 
Peter Brown 
: Show a bit of charity. Where’s your charity? 
RODNEY HIDE 
: Mr Peter Brown calls out that I should show some charity. In fact to New Zealand First I do because do I think that party is a charitable case. Mr Peter Brown in particular I think is a charitable case so I will not be too hard on him. I will just point out that I think he is mistaken. In fact I can understand New Zealand First being mistaken. What I cannot understand is the United Future party being so mistaken particularly Mr Copeland who has some experience of the charitable sector. I am astonished that he with his experience would come along to this great House—[ 
Interruption 
] Mr Copeland calls out that he has had quite a bit of experience. He cannot have learnt much. I am astonished that he comes to this great House and proceeds to socialise charities in New Zealand. 
The whole point of the charitable sector is that it is private. The whole point of the charitable sector is that it gets on and does the business. The whole point of the charitable sector is that it does not have to worry about busybody politicians coming along and making charities pay registration fees. That is the success of the charitable sector. Anyone who believes in charity in New Zealand has to vote against this bill. Anyone who believes in the charitable sector and the importance of a civil society has to vote against this bill. Why? Well what I ask Mr Copeland is the purpose of this bill? It sets up a new Crown entity. How I ask Mr Copeland will a new Crown entity help a charity? It is the charities that pick up the flotsam and jetsam that falls out of the welfare State that Mr Copeland supports. Now he is turning round and wants to hobble the charitable sector with a Crown entity that the charities themselves will have to pay for. I ask Mr Copeland: what is this Crown entity going to do? It is going to sit there and this Charities Commission will be responsible for running a registration reporting and monitoring system for charities. 
I ask Mr Copeland: how many charities are there? There are 37000 charities. So Mr Copeland and New Zealand First are voting for a quango to look after 37000 charities—to monitor them to register them and to keep an eye on them. There will be an army of bureaucrats doing that. [ 
Interruption 
] Sue Bradford laughs. How many people does she think it will take to register monitor and run 37000 charities? [ 
Interruption 
] Is the member going to vote against it? 
Sue Bradford 
: Absolutely! 
RODNEY HIDE 
: Oh thank God! I love the Greens! Sanity from the Greens. Why cannot New Zealand First see it now? ACT and the Greens are agreeing. The great National Party will be voting against the bill. And here we have that basket case New Zealand First voting for it. God only knows why Mr Copeland is voting for it. 
Peter Brown 
: God does know. 
RODNEY HIDE 
: God does know I know. God only knows why New Zealand First would vote for this. I ask Mr Copeland: what is the mischief that we are trying to fix? 
Gordon Copeland 
: If ACT and the Greens are against it we must be right. 
RODNEY HIDE 
: I have to say that that is the definition of the logic from the United Future party. Mr Copeland just called out that we are going to set upon the charities of New Zealand a charitable commission set up by the Labour Party with seven Government appointees running it all on the public tit paid for by the taxpayers that will require charities to register. Mr Copeland was asked: “Why are you voting for it?”. His answer was: “Because the Greens and ACT are voting against it.” That is the logic of the United Future party. 
Peter Brown 
: That’s a pretty good reason. 
RODNEY HIDE 
: I have to say that they are no longer poodle power because they do not even have a poodle brain. The logic of it is that there are some charities that run off the rails. Charities have been around for 400 years and they are forever running off the rails. What is the mechanism that we have to pursue them? Section 58 of the charities Act. I ask Mr Copeland: who is in charge of that? The Attorney-General of New Zealand is in charge. 
Dail Jones 
: The charities Act? 
RODNEY HIDE 
: No section 58. Under that section we can pursue a charity for fraud. 
Dail Jones 
: Of what? 
RODNEY HIDE 
: Section 58 of the Charitable Trusts Act. 
Hon Matt Robson 
: What about Fiji? 
RODNEY HIDE 
: Mr Robson the deputy leader of the Progressive Party leading the left-wing faction of the Progressive Party calls out: “What about Fiji?”. If they want to talk about charitable trusts they have an expert sitting on their side of the House in the name of Mr John Tamihere. We know that Prime Minister Helen Clark has forgiven him. All is forgiven. She will know all about the charitable trusts that Mr Tamihere has set up where the money has come from and where it has gone to. Do not worry we will be revealing that for the delight of— 
Hon Paul Swain 
: What about the pyramid selling schemes? 
RODNEY HIDE 
: Mr Swain is calling out about the pyramid selling schemes. Let us get back to the point. Why do we have 37000 charities having to be registered and monitored by a quango? 
Darren Hughes 
: Stop ripping them off. 
RODNEY HIDE 
: Now we have whatever that guy’s name is Darren Hughes calling out saying that the Attorney-General has not been doing her job. I agree with him. If the Attorney-General did her job and pursued those people who ripped off the charities and used them for personal gain we would not be debating this Charities Bill tonight—because the Attorney-General would be doing her job. 
Gordon Copeland 
: Now it’s a “he”. 
RODNEY HIDE 
: Well when she was the Attorney-General. Now it is a “he”. What is he doing about the charitable sector? Is he pursuing them? [ 
Interruption 
] Mr Copeland now agrees with me. God knows what he is thinking. I say to Mr Worth—he will understand this—that if the Attorney-General was doing his job we would not need this bill. Is that correct? 
Dr Richard Worth 
: Quite right. 
RODNEY HIDE 
: He agrees with me. 
Gordon Copeland 
: I don’t disagree. 
RODNEY HIDE 
: Mr Copeland now does not disagree. So now he is saying that if the Attorney-General was doing his job we would not need this bill. I look forward to United Future’s contribution to this debate. 
Peter Brown 
: Well sit down and get it. 
RODNEY HIDE 
: I will. We will get it after this and I want to hear some logic about why they are voting for this bill. I ask Mr Copeland to tell us in his contribution to this House how many civil servants it will take to monitor register and promote the research in the charitable sector. He does not know. He is voting for the bill and he does not know. I ask Mr Copeland: how much will it cost? [ 
Interruption 
] I have no idea but I am not voting for it. 
Darren Hughes 
: It will be a lot less after ACT has gone. 
RODNEY HIDE 
: It will be a lot less when ACT is in power; that is true. 
Darren Hughes 
: When ACT has gone. 
RODNEY HIDE 
: How much will it cost? The member is going to vote for it. 
Gordon Copeland 
: No you are right. I have no idea. 
RODNEY HIDE 
: The member has no idea. Mr Copeland has no idea what it will cost. He has no idea how many people it will take yet he is going to vote for the bill. Who is going to miss out? It will be the poor and the downtrodden—the people whom these very charities have been set up going back hundreds of years to serve. They are the people who will miss out. Why would we load charities with extra cost? Why would we load charities with extra bureaucratic hassle when we could simply demand that the Attorney-General do his job and pursue the ratbags who are ripping off their own charities—pursue them to the nth degree? If we did that and indeed lowered tax we would have more charity not less. This bill is about having less charity in New Zealand and for that reason the ACT party is voting against it. 
SUE BRADFORD (Green) 
: 
 I have to say on behalf of the Green Party that it is a real pity that we are seeing the Charities Bill come back to the House tonight for its second reading and all further stages under urgency. The community and voluntary sector has seen this bill as a really significant piece of legislation and I think it is unfortunate that we now have to deal with it in such haste. A complex bill such as this deserves the time and care needed for last-minute consultation and discussion especially during the Committee stage yet with such short notice it is virtually impossible to do that. I apologise in advance to the groups and individuals in the sector with whom I usually work for not having had the time to consult them on the final phase of the bill. 
In a way the fact that we are dealing with the bill with such unnecessary despatch in the House tonight typifies the whole unsatisfactory process on the bill from its conception to its delivery. The facts that the bill was conceived evidently in Treasury and was designed by the Ministry of Economic Development show just how out of touch the originating Minister or Ministers were with the realities of the community sector in this country today. The officials who worked with us on the Social Services Committee had a really tough job on all fronts and I have a lot of sympathy for them. They should never have been put into such a position in the first place. A bill that deals in such detail with issues of critical importance to all types of community and voluntary sector groups should have been all along within the purview of a ministry with substantial experience of the sector with the most obvious examples of such ministries being the Ministry of Social Development or the Department of Internal Affairs. The bill should not have been the responsibility of a ministry far more accustomed to working with “for profit” business than with the vast diversity that comprises the world of non-governmental organisations. 
The Government has very belatedly decided to hand the Charities Commission over to the Department of Internal Affairs with input from the Office for the Community and Voluntary Sector. That is a good step forward but it should have happened right at the start. A lot of the problems in the gestation of this legislation could have been avoided if the people who put it together had had the kind of substantial and hard-won experience of working with community groups that is needed when dealing with a whole series of complicated and sensitive issues. And any public servants with decent experience of working in this area would have known that the bottom line in terms of getting buy-in and acceptance would be widespread and detailed consultation locally and regionally as well as nationally rather than reliance on a limited and carefully selected task force to do the job for them. The history of this bill through Parliament exemplifies why and how even a well-meaning Labour Government still has a long way to go in terms of understanding not only how best to work with the third sector but also of understanding the need for the Government to treat all parts of the sector with the respect of an equal towards an equal rather than acting as a superior towards an inferior. 
I now turn to some of the details of the bill itself. I sat on the select committee which received many hundreds of submissions that critiqued in fine-tuned detail many many aspects of the legislation as drafted. I was as impressed as ever with the integrity and passion of community sector submitters in all their variety and with the fact that right across the spectrum people were almost universally committed to either major reform of the bill or throwing it out and starting again. I do not accept the comments made by several previous speakers including our committee chair Georgina Beyer that the eight points put forward to the submitters by the chair were the only ones they were concerned about. In fact there were hundreds of points of concern many of which were not touched on in the list of eight that was presented to the submitters. I am sorry that the Labour and United Future members of the committee chose to take the path of least resistance and to make a series of hodgepodge reforms of the bill rather than having the clarity of vision to actually throw it out and start from scratch learning from the overseas experience readily available to us and also utilising far more comprehensively the wisdom of all the groups that care about these things. 
There have been improvements made to the bill and I am glad of that. Some pleas from the sector were listened to and heard. We are pleased for example to see changes that mean compliance costs have been reduced that the prohibition on indemnifying officers has been removed—a totally ridiculous provision—that umbrella groups can register all their constituent bodies that the blanket disqualification of officers with certain convictions has been taken out and that the absurd requirement to have the group’s registration number on all written communication is gone. However serious concerns remain. For example we still have big issues around the definitions of “charity” “charitable purpose” and “public benefit”. The select committee in its wisdom decided not to expand or update the definition of “charitable purpose” which the Green Party believes is a missed opportunity to update a concept rooted in the law of early 17th century England. We are indeed truly immured in our colonial past. 
We also continue to have queries about advocacy and about the extent to which the advocacy function of community organisations can and should be regulated through the mechanism of this bill and of the Charities Commission once it is established. The Government has attempted to improve the bill by the addition of a provision to clarify that an organisation with so-called non-charitable secondary purposes such as advocacy will be allowed to register with the commission if its advocacy is in support of the charitable primary purpose. However I am still really apprehensive about the extent to which that allows the State to define what is and is not acceptable to itself as advocacy and what exactly is and is not charitable. That takes us back to the original definition problem. In the argument around advocacy I also remain as concerned as I always was right from the start that some groups with substantial advocacy functions will not even bother to try to obtain charitable status and the fact that they do not have it will have a downstream negative impact on their ability to gain funding. Funders will be looking for that registration number even if it is on fewer bits of paper and if a group does not have that number I fear the consequences. It will be far easier for funders just to say that if there is no number they will provide no money. 
Another area of disquiet for us even in the amended bill lies in the fact that although very limited appeal rights have been established there will still be an inability to develop common law that relates to the sector because those rights are so restricted. And from a more overarching point of view I remain completely unconvinced that this bill will actually or adequately address the need to find ways to expose and extinguish bogus and corrupt activities within the not-for-profit sector. The Government talked a lot at times about that being the trigger for the development of the bill—as Mr Hide did earlier tonight as well. But in fact I do not think that this bill will make much difference at all if any in that area. The worst levels of corruption and theft in the sector happen because some people are simply determined criminals and I do not see how the bill will aid in stopping that any more than the State sector legislation that we recently passed can in itself stop determined theft by public servants from Government departments. At another level the best way to deal with internal fraud abuse and other problems such as that in the community sector is actually through things such as good employment practices and the willingness of groups for example not to give false or misleading references for employees who move on to another organisation having left a trail of disaster behind them. Again that is not something that the bill can hope to solve. The answers lie in more willingness to share information when necessary between groups and in not leaving others to carry the can for a poor employment decision or for someone feeling sorry for a desperate job applicant. 
Beyond the amendments made during the select committee process the Government has also tabled further extensive changes to the bill this week. Those changes are mostly minor and beneficial in nature but none of them demonstrates the kind of major improvement that might have led the Green Party to change its position on this bill. We are voting against the Charities Bill tonight because we do not have confidence in the process by which it has been developed and because we do not think the amendments made by the Government go far enough towards solving the problems that the bill creates. We also lament the lost opportunity here. If the Government had had the patience to start the process over again and had worked cooperatively with the sector to draft a really exciting and positive bill Labour would have had our enthusiastic support from beginning to end. As it is this bill leaves a sour taste that all the minor amendments in the world will not fix. 
GORDON COPELAND (United Future) 
: 
 My involvement with this matter goes all the way back to 17 December 1987 when in a now somewhat infamous line-up in the Beehive Roger Douglas announced to the nation his proposal for a flat tax. He then went on to say that would mean charities would henceforth be paying taxation. Many twists and turns have occurred in the saga in the more than 17 intervening years that have brought us up to this day. 
This is the second attempt by a Labour Government to establish a Charities Commission. I opposed the first attempt in 1989 but then tried with successive Ministers of Finance for the next 10 years to get the Government to allow greater tax rebates for gifts made to charities from the maximum level of just $500 resulting from a total gift of up to $1500 per year. That was the rate that existed through that whole decade. In fact it was not until Dr Michael Cullen became the Minister of Finance in the year 2000 that that limit was adjusted for inflation from $500 to the current level of just $630 by way of tax rebate based on giving up to a maximum of $1819 per annum. That amount of $1819 is incredibly stingy when compared with the amounts allowed in other OECD jurisdictions. 
The USA has long allowed virtually unlimited tax deductibility for charitable gifts. This amongst other things sees the super-rich giving literally billions of dollars to charity in the case of people like Bill Gates and Ted Turner. It also means that the great universities like Harvard and Yale have enormous endowments whilst charities that work to alleviate poverty and addictions and do other good works flourish to the benefit of all. 
The United Kingdom under a Labour Government has adopted similar policies because it recognises in this most tangible and motivational of ways the importance of encouraging both philanthropy and generosity amongst the citizens of their countries. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Would the member relate the issue to the bill please. 
GORDON COPELAND 
: Members should remember it is more blessed to give than to receive. The good that charities do in our community is very significant. Indeed I go further in saying that charities are the most efficient organisations known to humankind. It is estimated that $1 of social services delivered through a charity would cost $2 if delivered through a Government department. Encouraging charities to flourish therefore is just common sense. 
New Zealand charities have high hopes for this bill. Their hope is that once the commission to register monitor and ensure that charities prosper is established—a task that we are likely to see completed very soon—the tax rebate will be lifted substantially and significantly in the 19 May Budget this year. In that regard I hope they will not be disappointed. 
It is true that this bill will mean that charities face new and additional compliance costs. There is no getting around that reality. This bill is therefore somewhat reluctantly accepted by charities as being necessary in order to bring about the benefit of a higher tax rebate for gifts given to charity. I am pleased to record that the Minister of Finance Dr Cullen is already in the public record as saying that once the Charities Commission is established by this bill which will be passed into law hopefully this evening he will be giving consideration to a significant increase in the rebate level for charitable gifts. 
I am also bolstered in my hope for this bill and its outcomes by the experience of both the United Kingdom and the USA. The United Kingdom has for many years had a Charities Commission. In recent years again under the current UK administration and Chancellor Gordon Brown the ethos of that commission has been changed quite significantly so that now its role is to ensure that philanthropy charity and generosity flourish in the UK for the reasons that I have mentioned. As a result charitable activity and charities themselves are now flourishing once again in the UK to a greater extent than they have for many many years. 
A similar situation exists in the USA. The USA does not have a Charities Commission but it is necessary in order to have tax-free status for a charity to complete an annual return to the Inland Revenue Service. This is quite voluminous and imposes compliance costs on charities in that nation that are far greater than will result from this bill. Not unnaturally when the Internal Revenue Service provisions were introduced by legislation in the United States charities strongly opposed them. But they now say quite openly that they were wrong. That is as a result of the increase in public confidence that has flowed from the fact that people know that they are dealing not with cowboy charities but with genuine bona fide charities. Charitable giving in fact has grown in the United States by several billion dollars. So that gives me the confidence and the hope that we will see a similar result in New Zealand. 
This bill therefore for me is just—if one likes—the first step in an ongoing process. I hope that it will lead to charity philanthropy generosity and that the good works our many many thousands of charities undertake often unsung on a day by day basis in this country will flourish and grow in the years ahead. If they do then all sectors of society including the Crown accounts themselves will greatly benefit and we will see far greater social services and good strong robust social outcomes for the citizens of this country. 
With those remarks I signal that United Future will support this bill both in its second reading and through all remaining stages. 
DAIL JONES (NZ First) 
: 
 I want to follow the comments made by Rodney Hide and Judith Collins during the course of this debate. It is very appropriate to ask why we need some legislation. Rodney Hide said during the course of his contribution that we should look at the Charitable Trusts Act because the answer is there. Unfortunately for Mr Hide that is not the case in practice. 
As I said in the first reading the call for the regulation of charities has been a longstanding one in New Zealand. In fact it goes back even as far as 1967 with a call made by Justice Gresson in the case of  
Re Goldwater (deceased) 
 [1967] NZLR 754. There was a call for a review of charities and that Act. 
When I was in practice in the late 1980s and the early 1990s I set up charitable trusts under the Charitable Trusts Act. I asked having looked through the Act what controls there were on all those charitable trusts. Really there were no controls on any of them although it would be fair to say that Mr Hide was correct to say the Attorney-General could look at them. But by the time a complaint is laid with the Attorney-General on anything all the evidence has gone all the money has gone and it is far far too late. 
The Charitable Trusts Act has not proved to be very good in practice in so far as control of charitable trusts is concerned. I wrote to the Minister of Justice about that matter and I received a copy of the Property Law and Equity Reform Committee report on the Charitable Trusts Act issued in 1979. The report referred in paragraph (1) to the request to consider the comments made by Justice Gresham in  
Re Goldwater (deceased) 
. The report went on to state: “Subsequently it was suggested that the whole of the Charitable Trusts Act 1957 called for a general examination. In particular the question was raised of the desirability of establishing more effective means of control of charitable trusts perhaps by means of a charities commission along the lines established in the United Kingdom.” 
The report in paragraph 13 of page 7 stated: “The committee was asked to give particular consideration to the questions raised by the Rev. R M O’Grady the associate-general of the National Council of Churches in a newspaper article in which he said: ‘The public has no protection against charities in New Zealand. It would not be difficult for a skilled promotional person to raise $10000 or more for almost any appeal one cares to name. Simply by national advertising and a small mailing to selected persons any charity can get itself established in a few weeks. Raising really big money for a charity requires time and planning. By far the best method is the house-to-house collection.’ ” That quotation is taken from a report written in 1979. We were talking about $10000 then. Taking inflation into account we would be talking about a bigger figure that could be raised by a skilled promotional person who could end up fleecing all the people who thought they were giving the money to charities. So I was very pleased when this bill came before the House. 
The need for this legislation has clearly been established a long long time ago. As Rodney Hide has said the legal basis for a charity goes back to 1601 and of course that Act just confirmed what had been happening prior to that. The Statute of Elizabeth 1601 confirmed the basis on which one could establish a charitable trust. So the whole concept has been going for a while. But in England—since before 1979 obviously—there has been a charities commission and in New Zealand since before 1979 we have had complaints about the way in which charities have been run. So that is the reason if we need a reason in answer to Rodney Hide’s question as to why we need a charities commission or some control on charities and this bill is the best bet that I have seen so far. 
I note what Mr Copeland said. Rather than looking to the past he is looking ahead to what might happen in the future. If much more money could go to charities that would be well and good. 
New Zealand First did not make a minority report on this bill but we were concerned—I was present at the select committee on the day we did the deliberation—that the Government was watering down the provision for the disqualification of officers as the commentary states on page 10. Clause 15(2) identifies which persons are disqualified from being officers of charitable entities. The original clause 15(2)(c) and (d) stated: “(2) The following persons are disqualified from being officers of charitable entities: … (c) a person who has been convicted of an offence punishable by imprisonment for a term of 2 years or more: (d) a person who has been convicted of an offence punishable by a term of imprisonment of less than 2 years and has been sentenced to imprisonment for that offence:”. Paragraphs (c) and (d) were taken out by the select committee which put in instead: “(c) an individual who or a body corporate that has been convicted of a crime involving dishonesty (within the meaning of section 2(1) of the Crimes Act 1961) and has been sentenced for that crime within the last 7 years:”. 
So the committee was trying to bring into the provision that “Nandor Tanczos Clean Slate Bill” type of thing—that nice warm green fuzzy idea. The committee has changed the provision into a nebulous type of thing which means that anyone who has been convicted of an offence punishable by imprisonment for a term of 2 years or more can be a trustee and a person who has been convicted of an offence punishable by a term of imprisonment of less than 2 years and who has been sentenced to imprisonment for that offence can be a trustee. New Zealand First cannot support that. How can anyone who supports law and order or who wants to make sure that the trustees of a trust function properly and are not criminals possibly support that amendment? That is why I have lodged an amendment on the Table reinstating the original clauses 15(2)(c) and (d). 
After all the criticism of trusts and charities is that they are being fleeced by fly-by-nighters criminals or people who may get on the board and do away with the money—and this bill is promoting that. It is promoting criminals being on the board. It is nonsense to strike out those two paragraphs and to put in a nebulous provision about whether those people were sentenced for that crime within the last 7 years. The whole thing is a nonsense. I think that we need to be tougher on law and order. We need to make sure that charities have a stronger ability to refuse to accept people who have criminal convictions of 2 years’ imprisonment or more or who have been sentenced to imprisonment for less than 2 years for an offence. 
I cannot understand how United Future or Labour would have agreed to those provisions concerning persons being convicted of an offence punishable by imprisonment for a term of 2 years or more being struck out. The mind boggles. Of course the Greens in a strange sort of way opposed this legislation. But when I said that New Zealand First wanted this provision to be reinstated they then changed their mind and now they support this part. 
Sue Bradford 
: We certainly don’t support what you are putting up now. 
DAIL JONES 
: What I am putting up is what was in the original bill. The Greens do not support what was in the original bill because there might be a member in this House who falls within the definition of the original clause 15(2)(c) and who would not be eligible to be a trustee on a charity. 
Judith Collins 
: He’s on stress leave isn’t he? 
DAIL JONES 
: No I say to the member that such a member is sitting in the House at the current time. There is a female member of this House who has been convicted of an offence punishable by imprisonment of a term of 2 years or more who might be affected by this legislation. 
I just raise the point that if a person has been convicted of an offence punishable by imprisonment for a term of 2 years or more—that means just a conviction without the person going to jail—he or she can still be a trustee on a charity and be involved in working for a charity. If the person has been convicted of an offence punishable by a term of imprisonment of less than 2 years and has been sentenced to imprisonment for that offence he or she can still be a member of that charity and be working for it. I think that is nonsense. 
As I said the commentary states under the heading “Disqualification of officers” on page 10: “The New Zealand First Party supports the intent of the original bill.” As we support that intent we want to see that intent retained in the way that the Government originally wanted it—and I believe the Government was absolutely right on that occasion. So I have put forward an amendment to reinstate the original provision into the bill. We want honest people working for charities and the new clause 15(2)(c) is totally contrary to what was intended in the formation of the Charities Bill and the Charities Commission. 
A party vote was called for on the question  
That the amendments recommended by the Social Services Committee by majority be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendments agreed to. 
A party vote was called for on the question  
That the Charities Bill be now read a second time. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Bill read a second time. 
Instruction to Committee 
Hon JUDITH TIZARD (Associate Minister of Commerce) 
: 
 I move  
That it be an instruction to the Committee of the whole House on the Charities Bill that it take the bill part by part. 
A party vote was called for on the question  
That the motion be agreed to. 
Ayes 61 
New Zealand Labour 51; United Future 8; Progressive 2. 
Noes 57 
New Zealand National 27; New Zealand First 13; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Motion agreed to. 
In Committee 
Part 1 Charities Commission 
KATHERINE RICH (National) 
: 
 It is a pleasure to rise to speak to Part 1. Looking at the part I find it very interesting to see how much of it the Government has changed. It is not often that one picks up a bill and finds that more or less an entire part has been rewritten word for word. The only thing I can see that has not been rewritten is the definition of “chairperson” which means the chairperson of the board. The rest of it has been struck out by majority and new provisions have been put in. I am not surprised as to why either because after 753 submissions all of which have said that the legislation as originally drafted was nuts the Government did not like being bagged by charitable group after charitable group and being told that the bill was an absolute nonsense. 
One of the first things to be struck out was the idea that if a body was not registered under the new Charities Commission it would not officially be able to receive funds and that groups community trusts or financial groups would not give one funding if one was not an approved donee. That was one of the major things that this bill created concern about. Members of group after group said that it was hard enough being a volunteer and being involved in a charitable group without the level of bureaucracy and registration required plus the cost which will make their work more and more difficult in times when it is harder not easier to collect funds. So the Government has done a total flip-flop. 
The Government has rewritten this entire part. It has taken out the bits of heavy-handed regulation because it knew they would be unpalatable in an election year and it has put in a few clauses that it thinks will get the bill through with the help of a few parties in this Parliament. I think that that will backfire. We have already heard the Minister introduce this part with as little passion as could possibly be used in such a delivery. That is because her heart is not in it either. She knows that this bill will provide a level of regulation and cost that we have not seen before. Thousands and thousands of charities will find it harder not easier to do charitable work in this country. 
A lot in this part was an absolute joke. My learned colleague Judith Collins told me in the House today that 37000 groups will be looking to register through this new organisation. What a waste of money! It will not put one more volunteer on the street. It will not make their work any easier. It will not help one single New Zealander to get any better service. It is all about Government control. It is about the Government sticking its nose in so that it can collect more tax. That is all it is. That is what we are seeing here. The Government wants to collect more tax from some of those groups and get its hands on money that it does not actually earn. As to saying that the whole point of the bill is to protect people I tell members that those organisations that rip off New Zealanders will not bother to register through the Charities Commission. They will not bother to go through the processes to become legitimate charities. That is the whole point—they are criminal. They will go ahead and rip off New Zealanders without getting the registrations and things that this bill requires. Even some of the reporting required in this part is just absolutely outrageous. 
I wonder whether any members of the Government have been involved in a voluntary group of late because if they have they would have heard people saying: “What is the point of becoming a volunteer when we’re going to be in the gun if things go wrong?” So we have seen a total rewrite. Part 1 does not look anything like what was in the original bill because the Government knows that the bill as first drafted was an absolute joke that was designed to create problems—and boy it is not like the criticism from some of its mates when they turned up to give submissions on this part. Time and time again this legislation was bagged and Government members sat like sad sacks— 
Judith Collins 
: Like they are now really. 
KATHERINE RICH 
: Like they are now but they are probably thinking more about John Tamihere than anything else. It is interesting though that while we are talking about the Charities Bill the Government has shown the ultimate charity to Mr Tamihere by allowing him to stay. So why is the Government being so charitable to Mr Tamihere when it is being super-uncharitable to those charities and organisations? 
GORDON COPELAND (United Future) 
: 
 I want to take a brief call on Part 1 of the Charities Bill. Let me just say for a start in response to the remarks from the member Katherine Rich that I would have thought it was actually quite meritorious for the Government and the Social Services Committee that considered this bill to have changed the bill significantly in response to the genuine concerns of the many submitters whom we heard. I do not find it a very convincing argument that having heard those submissions it is some kind of cardinal sin to change the bill accordingly. 
The other point I make is that under this bill registration for charities is not compulsory. Indeed because of my involvement in the sector a number of charities have already come to me and said they are not sure whether they really want to register because of the compliance costs involved. I have said to a couple of them that they should think carefully about that. The purpose of registration in Part 1 is to enable charities to remain exempt from income tax. Many smaller charities do not have any taxable income as defined in terms of the Income Tax Act. For a lot of charities whatever comes in on one hand in terms of income is immediately applied to charitable works on the other so they do not actually have any taxable income. 
So it is still an option for such charities to decide not to register. It does not make them some sort of second-class citizen. They are still legitimate charities—it is just that they will not get tax relief if they have some taxable income which might be just a few bucks of interest for example that they have to pay tax on. 
That is an option for charities. In contrast the large prominent public charities will certainly of course need to register and so forth in order to continue to access income tax relief and also to ensure that money given to those charities is eligible for what we call donee tax rebates. 
I really want to talk about just one aspect of the amendments to clause 4 as set out in Supplementary Order Paper 357 which changes the definition of “officer”. This is a very worthwhile amendment. It arose as a result of submissions received from the Inter-Church Working Party on Taxation and in particular from the representatives of the Anglican and Presbyterian Churches. Those Churches are governed by bodies—in the Anglican Church referred to as synods—that comprise several hundred people. 
It would be quite impossible to have all those several hundred people designated as officers of the charity. For example we have to ensure that every one of those people is not disqualified from being an officer in terms of this bill and it would be quite an impractical way to proceed. Accordingly this amendment is aimed at ensuring that the Anglican and Presbyterian Churches and to some extent the Methodist Church will be able to register themselves and have a definition of “officer” that will fit the circumstances of their organisations. That is a very good step forward. 
Furthermore the Minister’s Supplementary Order Paper omits and substitutes a new definition of “officer” and adds subclause (c) and subclause (d) to do with regulations just in case the submitters the select committee and the Government itself have missed something and a problem arises about registration to do with officers. Regulations may then be put in place to overcome whatever difficulty arises. 
The intent is to give complete flexibility to the new commission so that it can register charities that come to it having regard to their particular circumstances. Those circumstances vary enormously. For example the situation as between the Catholic Church and the Anglican Church is quite radically different. This is a good step forward and I commend the Supplementary Order Paper to the Committee. 
RODNEY HIDE (Leader—ACT) 
: 
 I note that Mr Copeland explained to the Committee why United Future is voting for this part and indeed for the whole bill—which is with some reluctance as I understood his speech. It is because Michael Cullen has promised he will increase the tax-free threshold for charities if United Future supports the bill. 
Judith Collins 
: Did you check all the words! 
RODNEY HIDE 
: I do not know whether Mr Copeland checked all the words. He has just said that to say “promise” might be a bit rich. But to be honest he has just explained United Future’s voting for this bill in a most unparliamentary way—that is there will be a quid pro quo for charities and that is why United Future is voting for it. It is not voting for the legislation because it thinks it is a good idea; it is voting because Michael Cullen who—we know from John Tamihere—dupes and tricks United Future most days has promised them some time in the future some more money. 
Gordon Copeland 
: Dream on! 
RODNEY HIDE 
: I think that Mr Copeland is dreaming on about this promise from Mr Cullen. 
I notice that Mrs Rich has explained just how much this bill was gutted at the Social Services Committee so I do not need to go there. But I draw members’ attention to the functions of that commission that quango that Mr Copeland wants to vote for. It is truly extraordinary. There will be a quango of seven Labour Party flunkies and an army of bureaucrats and when we see the calibre of the people that Labour has as MPs and JPs we can imagine the sort of people that Labour will have on the commission. 
The commissioners’ job will be to educate and assist charities in relation to matters of good governance and management. Can one imagine Helen Clark lecturing and educating anyone on good management and good governance or John Tamihere lecturing anyone on good management or good governance? What a joke! The commission is there to make appropriate information available in order to assist persons to make registration applications under this legislation. So it sort of exists to teach charities how to fill in the forms that the commission requires to be filled in. Under clause 10(a) its function is to: “receive consider and process applications … and (b) compile and maintain a register of charitable entities;”. 
I remind Mr Copeland that the charities sector has survived 400 years without that sort of bureaucratic nonsense. The commission is also to (e) “receive consider and process annual returns submitted by charitable entities … —thousands and thousands of them. It is to supply information and documents to the Inland Revenue Department and to monitor charitable entities. So charitable groups that are getting on with doing the business will find an army of those types of people—the sort who run the Labour Party and whom John Tamihere described as narrow; who have no family life or outside life but who just sit around plotting late at night— 
Judith Collins 
: Parlez-vous français? 
RODNEY HIDE 
: Parlez-vous français? Those people will be crawling all over those charities to monitor them. They are to inquire into charitable entities so we will suddenly find that they have nothing better to do but plot and plan when inquiring and investigating into charities. 
What about this? Under clause 10(k) they are to: “stimulate and promote research into any matter relating to charities”— 
Hon Member 
: Smarmy! 
RODNEY HIDE 
: It is exceedingly smarmy; in fact it makes one think that Steve Maharey must have had something to do with it—and “(l) carry out any other functions that the Minister may direct the Commission to perform in accordance with section 87;”. 
I say to Mr Copeland that I think this bill proves what John Tamihere was saying about Michael Cullen and United Future. United Future is voting for this bill not because it agrees with it but because Michael Cullen has “promised” to increase the tax-free threshold for charities and that is the quid pro quo. Well there is a word for what Mr Copeland has just admitted to and I am not allowed to use it. But that shows us the sort of integrity that United Future members bring to this Parliament when they vote or do not vote for a bill. They are voting for this bill on a monetary promise that will never be delivered—and John Tamihere was right: they are so stupid they do not even know how duped they are; they do not even realise it. 
If people want to know why charities are going to struggle in New Zealand they have two groups to blame—United Future and New Zealand First. I say this about United Future: at least it was bribed to do it. 
SIMON POWER (National—Rangitikei) 
: 
 I thank Mr Hide for his contribution and just say to United Future— 
Hon David Benson-Pope 
: He visits Fiji regularly for a contribution. 
SIMON POWER 
: That Minister should go back to sleep. I say to United Future to beware of legislation that sets up a commission. The Tertiary Education Commission was also created in a similar vein. That commission was to be a light-handed steering instrument to guide strategic priorities in the tertiary sector—whatever that means. Two hours and lots of paper later I was none the wiser. The story with the Tertiary Education Commission is that it now has a staff of 324 people— 
Rodney Hide 
: No! 
SIMON POWER 
:—that is the light-handed steering instrument—and cost $210 million to set up and run. It has been restructured once already—every job readvertised in a complete restructuring of a governance system that parties in this House said would not work. The Government was told at the time that commission was set up that it would not work. But no the Government members sat opposite and said that we did not understand that that was a light-handed steering instrument and was not designed to get in the way of the tertiary sector. The same thing will happen in the charities sector. 
I say to voluntary organisations and charities to beware of clause 7 that sets up a commission. I will tell those charities what is coming with that commission—320 bureaucrats will storm down the doors of their charities to monitor work that the charities have always done unencumbered without needing to seek the permission of the Government to do too much and with their independence never compromised. I tell charities to beware of legislation that sets up commissions. That means one thing: that the pitter-patter of an army of bureaucrats is on its way to disrupt the good work that charities throughout New Zealand do. 
Where is the hint in the legislation that that is what is coming? Well members and those interested should turn to clause 10. There we have a page and a half of the commission’s functions. It is very reassuring that it will be a light-handed organisation that will leave the sector to get on with its business! There is a page and a half of things it will do—a page and a half of functions to interfere with the workings of charities. 
But my favourite clause is clause 10(i)—it is a doozy. This commission will monitor charitable entities to ensure that the entities that are registered as charitable entities continue to be qualified for registration as charitable entities. Look out here comes the commission with its clipboards and pens both red and green for initial checking and auditing. That group of bureaucrats will be on the march to disrupt the good independent work that charitable organisations have done up until this point. 
The real questions the sector should be asking the Government are why do they need that commission why do they need more people interfering in the way they conduct their affairs and why do they need clause 10 with paragraphs (a) through to (o) outlining the functions of the commission. I say to those organisations that the same thing happened with the tertiary education sector. It was promised a light-handed commission that would guide the sector gently. Look at what has happened! The commission has 324 bureaucrats and costs $210 million. I tell the sector to beware of legislation that sets up commissions. 
The question was put that the following amendment in the name of Judith Collins to clause 10 be agreed to: 
to add to clause 10 the following new subclause: 
(2)When carrying out the functions of the Commission the Commission must have regard to the need where reasonably possible to minimise the compliance costs of the registered charity. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 34 
New Zealand National 27; ACT New Zealand 7. 
Noes 84 
New Zealand Labour 51; New Zealand First 13; Green Party 9; United Future 8; Progressive 2; Maori Party 1. 
Amendment not agreed to. 
The question was put that the amendments set out on Supplementary Order Paper 357 in the name of the Hon Judith Tizard to Part 1 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendments agreed to. 
A party vote was called for on the question  
That Part 1 as amended be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Part 1 as amended agreed to. 
Part 2 Charitable entities 
JUDITH COLLINS (National—Clevedon) 
: 
 I want to look at one particular clause that really does strike at the heart of this legislation which is too socialistic for even the Greens to support as it has too much Government regulation. There may be a snigger coming from members opposite but they know it is true. I refer to clause 26 “Grounds for removal from register” which states that “The Commission may remove an entity from the register if—” and in particular I refer to subclause 1(e)—“any person has engaged in serious wrongdoing in connection with the entity;”. What does that mean? I turn to the definition— 
Rodney Hide 
: Would John Tamihere be interested in this? 
JUDITH COLLINS 
: Yes I think Mr Tamihere would be interested in this. But I turn to the definition of “serious wrongdoing” in clause 4 and that definition is given as “(a) an unlawful or a corrupt use of the funds or resources of the entity; or (b) an act omission or course of conduct that constitutes a serious risk to the public interest in the orderly and appropriate conduct of the affairs of the entity; or (c) an act omission or course of conduct that constitutes an offence; or (d) an act omission or course of conduct by a person that is oppressive improperly discriminatory”—and what does that mean?—“or grossly negligent or that constitutes gross mismanagement”. 
What that means for charities is that if the charity is unfortunate enough to become the victim of a con man the charity suffers. It is the charity that folds and that has to be one of the most stupid provisions in this legislation. What does it mean? Well the Problem Gambling Foundation a few years ago had a big chunk of money ripped of by Ralph Gerdelan who was at that stage I think the chief executive. He stole money from that organisation and under this law when it comes through that very victim the Problem Gambling Foundation would in fact be liable to have itself deregistered. 
Rodney Hide 
: How would Stephen Ching get on? 
JUDITH COLLINS 
: I think Mr Ching might also have some problems. How many laws do we have where the victim pays yet again because of the wrongdoing of the perpetrator of the crime? This is like having the poor old person who is stolen from suddenly lose his or her house as well. That is exactly what this silly silly law is all about. It is a complete overreaction. We have 37000 charities in this country. We know the ones that get ripped off because we discuss these matters in the House day after day and it normally involves people whom we all know. Yet what we have here is a bill that punishes the very people who are the victims. I can just imagine that if another party had put forward this sort of silly legislation the Government would be screaming and saying: “Oh no we cannot attack the victim twice.” 
This bill attacks the victims of crime by saying that they could lose their charitable status. What about the charities that provide homes for abused women? What if one of them happens to be ripped off by a con woman a con artist or whoever? What about them? They are liable to be stripped of their charitable status by some unfeeling Government body full of people who have never put themselves on the line full of Government appointees and people who have never done a charitable act in their lives except at their last caucus meeting as the Labour Party just did and who make their living out of the taxpayers of this country and have never contributed a cent that they did not get from taxpayers first. 
DAIL JONES (NZ First) 
: 
 This is an appropriate time for me to make my point in regard to clause 15 and the amendment I propose. The two provisions I wish to reinstate in the bill are clause 15(2)(c) and (d). They can be reinstated along with the new clause 15(2)(c) which states that the following persons are disqualified from being officers of charitable entities: “an individual who or a body corporate that has been convicted of a crime involving dishonesty (within the meaning of section 2(1) of the Crimes Act 1961) and has been sentenced for that crime within the last 7 years:”. So if someone was sentenced in 1997 which is 8 years ago this provision does not apply. So despite anything that someone did in 1997 or before—any type of dishonesty—that person is still entitled to be a trustee. In 7 years’ time the person who has just been mentioned by Judith Collins will be entitled to be a trustee again. That is what this legislation permits. 
Rodney Hide 
: Well I’m pleased I’m not voting for it. 
DAIL JONES 
: It is quite extraordinary and that is why I am proposing my amendment. My amendment which was originally in the Government’s bill states that a person cannot be involved if that person has been “convicted of an offence punishable by imprisonment for a term of 2 years or more” or if one is a person “who has been convicted of an offence punishable by a term of imprisonment of less than 2 years and has been sentenced to imprisonment for that offence”. 
That is relatively minor if we look at section 2(1) of the Crimes Act of 1961 and make our way inevitably through that. What we are concerned about in this particular part is people who may have been charged with offences from more than 7 years ago involving dishonesty; taking obtaining or copying trade secrets; or aggravated burglary. Those people could be trustees if they committed the offence and were sentenced more than 7 years ago. But for some reason if they did it in the last 7 years they cannot be. 
What is the magic about 7 years? I am not suggesting that we should provide for such a big offence in the last 7 years; I am just saying it should be something involving a sentence of 2 years or more imprisonment which is what the Government originally wanted. It is in addition to what the Government wants in regard to 7 years. It seems to me to be such a simple measure. The Government wants to do something to protect charities from people ripping them off but it is quite happy to have people on charities who may have been the great train robber 8 years ago. Such people could be entitled to be an officer of a charitable entity. Any criminal who was sentenced 8 years ago on dishonesty matters can be an officer of a charitable entity. It is quite extraordinary. I just cannot believe that that is what clause 15(2)(c) put in by the majority does. 
All I am asking is whether we can go back to including the original paragraphs (c) and (d) which I am calling (bb) and (bc) and the new paragraph (c) as well. The Government can have what it wants but I say that it does not want criminals who were convicted 8 or 9 years ago or even 3 years ago of minor offences on those charities. If we look at the charges mentioned here they involve terms of imprisonment of 7 years 10 years and 15 years as we go through. If in the last 7 years one has been convicted of a 2-year offence one could still be on a charity even now. 
Someone in the Government has not thought this through. There will be the defrauding of charities left right and centre because those people will be permitted to be on them. I just cannot understand the Government’s thinking on this issue. 
New Zealand First is supporting this bill. There are no deals. It is because I have taken an interest in this matter for 15 years. I have been creating charitable trusts for people for a long time and I just cannot understand a bill that would allow dishonest criminals to be officers of charities under a bill that is meant to protect people from dishonest officials. It is extraordinary. 
I will leave it at that. I cannot keep repeating myself forever. I hope the Government will see the light and support the provisions that it supported originally and it was right in doing so. I cannot understand who asked the Government to take them out. The Greens do not support this. They have a vested interest in keeping people who have committed crimes with a term of imprisonment of more than 2 years on the committees. They voted for the amendment to this part at the select committee when we voted against it. We voted against the amendment at the select committee. 
RODNEY HIDE (Leader—ACT) 
: 
 Judith Collins has drawn our attention to clause 26 “Grounds for removal from register”. Clause 26(1)(e) states: “any person has engaged in serious wrongdoing in connection with the entity;”. Judith Collins drew our attention to that then she said that wrongdoing is defined in clause 4 in this way. It is: “(d) an act omission or course of conduct by a person that is oppressive improperly discriminatory or grossly negligent or that constitutes gross mismanagement”; or (c): “an act omission or course of conduct that constitutes an offence;”. 
I would love the Minister to speak on this bill and explain what is an act or omission that is oppressive improperly discriminatory or grossly negligent or that constitutes gross mismanagement. I think we need an explanation in this Committee of what that entails and I will give examples. The Waipareira Trust would just fold because we know that the chief financial officer has admitted to the Serious Fraud Office that he forged six invoices to rob the trust of $80000. On that basis he has committed a course of conduct that constitutes an offence so the whole Waipareira Trust would be deregistered. Is that what the Government wants? I look to the Minister in the chair the Hon Judith Tizard to explain that if we have someone like Mike Tolich who has admitted forging six fake invoices to get $80000 out of the trust while John Tamihere was the chief executive officer— 
Dail Jones 
: He did that more than 7 years ago so he is eligible to be on a trust now. 
RODNEY HIDE 
: No he did not do it 7 years ago. It was in 1989. 
Dail Jones 
: So he can still be on a trust now. 
RODNEY HIDE 
: OK but that example— 
Dail Jones 
: He can still be on a trust now. 
RODNEY HIDE 
: But what happens to the trust itself— 
Dail Jones 
: It’s irrelevant. This bill allows him to be on the trust. 
RODNEY HIDE 
: —if it happened 5 years ago? I do not know why Mr Jones is voting for the bill he has so many complaints about it but there we go. Then I go to this provision that states “oppressive improperly discriminatory or grossly negligent” and I ask about Mr Steven Ching. Is it grossly negligent for example that he did not reveal to the Labour Party or to the JP society that he had obstructed justice? Is that an example of gross negligence or gross mismanagement? I do not know. We need to know what it is that gets a charity deregistered. [ 
Interruption 
] Peter Hodgson is laughing; he must know the answer. He is voting for this. What does it mean to have a person in a charity who is grossly negligent whose behaviour constitutes gross mismanagement or who is improperly discriminatory? What does that mean? [ 
Interruption 
] Peter Hodgson says that if I sit down he will take the call. He will get an opportunity when I do sit down. I would love him to take the call because he is a Minister. We have a Minister in the chair who has resolutely refused to speak to this bill or to explain a thing. So I am pleased that Peter Hodgson has told the Committee that when I sit down he will take the call. 
Hon Pete Hodgson 
: If you sit down I will take a call. 
RODNEY HIDE 
: Well I am allowed my 5 minutes; there are no conditions on that. We know that over there on the Labour benches it is rosy on the outside but on the inside it is all miserable fisticuffs and the rest of it. 
Hon Judith Tizard 
: You wish! 
RODNEY HIDE 
: Judith Tizard says: “I wish”. I can tell her that I would not want to go 10 rounds with her—no way. I would even agree to this bill if that were the prospect—fisticuffs with Ms Tizard! 
But I say to members that I just want an explanation from the Minister in the chair as to what is meant under clause 4(1) in relation to “serious wrongdoing” of “(d) an act omission or course of conduct by a person that is oppressive improperly discriminatory or grossly negligent or that constitutes gross mismanagement”—because what we have seen in the Labour Party is that almost anything goes. With Steven Ching and John Tamihere the Prime Minister is infinitely forgiving but when it comes to a charity the whole charity gets deregistered. I ask Mr Copeland whether that is right. 
Gordon Copeland 
: Not necessarily. 
RODNEY HIDE 
: Oh not necessarily! Well why not? 
Gordon Copeland 
: It is not necessarily. It doesn’t necessarily follow. 
RODNEY HIDE 
: What does he mean when he says that it does not necessarily follow because— 
Gordon Copeland 
: It could be. 
RODNEY HIDE 
: It could be. Well this is great! We are passing law here tonight—and I wish I could vote against it twice now— 
Gordon Copeland 
: Read the clause. 
RODNEY HIDE 
: Well I am reading the clause and Mr Copeland is saying that it might apply it might not apply they might be deregistered or they might not be deregistered and the Minister will not stand and take a call to explain what it all means. 
SUE BRADFORD (Green) 
: 
 I was not going to speak on Part 2 but when Mr Dail Jones repeated comments about clause 15 and asked for some reason why this clause has been amended I felt constrained to speak as that is a clause that would have affected me personally. 
He is right: I did vote for the Government’s amendments in the select committee because I think they do absolutely the right thing—and they do what many hundreds of submitters advised the Government to do as well. The effect of the original clause as drafted the original clause that Mr Jones and New Zealand First are trying to put back into the bill would have been to exclude many many hundreds if not thousands of really excellent board members and trustees from taking up positions on the boards of the thousands of community groups around this country. I am more than happy to say that I am one of those people; I have been convicted of offences liable for 2 years’ imprisonment or more—offences connected with the 1981 Springbok tour. I have no shame about them. I do not want to be clean-slated for them. I am proud of those offences because they are part of my political history and actually such a history is an honourable tradition of previous generations in the Labour Party. 
Rodney Hide 
: Crooks and thieves. 
SUE BRADFORD 
: It does not mean one is a crook or thief—to stand up for one’s political principles at times like that. I think it is a really good qualification for being in this Parliament. It is also a really good qualification for being on the board of an organisation that is following certain principles and values as so many of our church and community sector groups do. 
But that is actually a minor matter in terms of why I supported the Government’s amendments to this clause. It is not just about people like me with political convictions. I might just add that I taught governance at the tertiary level for 5 years before I came to Parliament. I have taught many people about these things and it is really ironic for me as a teacher of governance that this clause would have said that any group of which I was a board member had to get rid of me unless it got a special exemption. And I still am on some boards. 
But beyond that and much more important is that a whole lot more people who have been convicted for all sorts of criminal offences not political ones would also have been excluded. Many many of the organisations that do such good work in our community are like the one already mentioned by my colleague Judith Collins the Problem Gambling Foundation. As well there are many groups that for example work with prisoners like the Prison Inmates’ Loved Ones Linked as One to Renew Strength the Prisoners Aid and Rehabilitation Society groups that work in the drug and alcohol addiction areas and ones that work with all sorts of offenders and ex-offenders. Some of the best people on those boards are people who have been down that road of addiction have been in prison or have been a gambler. Those people are very very valuable members of those boards and they should not be excluded. That is the main reason why it was very important that the original clause was eliminated from the bill and was replaced by the one we have in this draft. 
As members know the Green Party does not support the bill overall but we are really pleased that in a number of areas the Government has seen fit to improve it. We accept the inevitable: this bill will become law. Community sector groups are going to have to work with it and we want it to be in the best shape it possibly can be. So I certainly hope that no parties in this Committee will support the New Zealand First amendment. 
I have a couple of other points while I am on my feet. I do not know that I would go as far as some of the comments from Simon Power and Rodney Hide about jackbooted armies of bureaucrats marching into the sector as a result of the Charities Commission being set up but on looking at this part overall I cannot help but be a little afraid that so much of the focus of this bill is simply on regulation down to very minute detail. The overarching feel we get from it is that it is about the monitoring and regulation of a sector that thrives on its individuality and its commitment to purpose to kaupapa to values. Somehow we have got it wrong in this legislation; it is all about regulation and not about enabling and empowering the sector to do the good work it can do. 
Finally in terms of clause 26(e) which Ms Collins and Mr Hide have been talking about again I agree with them. It is phenomenally incomprehensible that an organisation could or should be punished for the misdoings or outright crimes of one person as Mr Hide referred to. It is a situation I myself have been through with organisations in terms of other people. Organisations are inevitably badly damaged by criminals who somehow become part of them and rip them off and it is a curse of the community sector that it happens to us at times. Of course it happens in the private sector and the Government sector as well; all sectors have to deal with it. But this kind of clause simply does not make sense. If a trustee or board member knowingly commits a crime or acts against the law of this country of course he or she should be held responsible as should a staff member who does that. But that does not mean the organisation should suffer. 
GORDON COPELAND (United Future) 
: 
 I want to make a brief comment first of all on the amendment from Dail Jones. He asked which submitter to the Social Services Committee had asked for those words to be dropped from the Charities Bill. 
I can tell him that one of the submitters was the Prisoners Aid and Rehabilitation Society a charitable trust. It made the very sound point that in fact one of the things it does in terms of rehabilitating prisoners is to encourage them to give something back to the community by becoming involved in a charity. I would also point out to Dail Jones that his amendment would exclude not only Sue Bradford but also Nelson Mandela from being an officer of a charity. I for one would be very proud to have him as an officer of a charity with which I was involved. 
I would like though to speak for a moment about clause 56 a very long new clause that has been inserted into the bill. Rodney Hide spoke a little while ago about charitable trusts as if it was simply the case that all charities are also charitable trusts. But that is not the case. In fact one of the unique features about this bill and about the charitable sector is that charities come in many different shapes and sizes. Yes we do have charitable trusts under the Charitable Trusts Act but we also have incorporated societies under the Incorporated Societies Act. We have companies under the Companies Act and we have unregistered associations of people—Catholic parishes would be an example of that. We have charities that are set up under their own special Acts of Parliament such as the Anglican and Catholic bishops’ empowering Acts. We have charities that take the form of partnerships and we have many thousands of charities that come into existence through the operation of wills. It is the sheer bewildering variety of shapes and sizes of charities that makes it quite difficult to write law that states exactly how they should be registered exactly how they should be monitored and exactly how they should submit returns. 
The very innovative way of cutting through that great Gordian knot was clause 56 “Commission may grant exemptions”. Tonight I want to really commend the officials who drafted that very extensive clause because it essentially aims to equip the Charities Commission with a whole tool-box of exemptions that will enable it to fit the way it regulates a charity to the actual legal form and circumstances of that charity. Also in the Minister’s Supplementary Order Paper 357 there is a small amendment to clause 56 which adds to the list of matters on which the commission can grant exemptions. It adds clause 16 of the bill to the list. If we go to clause 16 we find that it is in fact the registration clause. I think that completes as I said before some quite elegant legal drafting so that in all those different circumstances the commission will be able to be flexible with the aim of doing a good job of fostering charities in this country as it is bound to do and of ensuring that compliance costs are minimised. 
I really commend those provisions to the Committee. 
KATHERINE RICH (National) 
: 
 It was very interesting to hear the previous speaker mention words like the “sheer bewildering variety” of charities. Yes out of the 37000 charities in this country there are a huge number of differing kinds of charities yet this bill is trying to squash them into regulation and registration even though they may differ dramatically in terms of their objectives and the work that they do. 
I would like to endorse the comments made by Judith Collins and also by Sue Bradford on the original clause 15 “Qualifications of officers of charitable entities”. It was very interesting to hear members of the New Zealand Prisoners Aid and Rehabilitation Society when they came before the Social Services Committee. They basically said that the society would have no office holders if that part of the bill went through as it was. Is it not odd that someone like Sue Bradford can become a member of Parliament under the present law but that under this bill as it was she could not have become the treasurer of her local Plunket? 
Office holder after office holder said to us that this law was just nuts. The first thing they wanted to be able to indemnify themselves against was carrying the can if things go wrong and luckily that is one of the changes that has been made. Time and time again volunteers said that they were happy to work for their communities as volunteers but if things go wrong why should they carry the can? If the local Plunket group finds out that someone has embezzled money or the local sports club finds out that some office holder committed some wrongdoing that constituted an office holder being penalised why should the group carry the can for that? So that change made a lot of sense. 
The Minister in the chair Judith Tizard needs to explain what mischief this legislation is trying to solve. She has not taken one call tonight to explain any part of this bill or to answer any of the questions put to her by any of the speakers. 
I would like to turn members’ attention to clause 23 “Charitable entity must display registration number” which has been struck out. One mischief that this bill was supposed to solve was the opportunity for bogus charity collectors to walk the streets shaking a tin and asking for money. This provision required all charities to display a registration number on every written communication every piece of fund-raising material every pamphlet every badge and every bit of paper. Charitable group after charitable group came before us and said that it would cost them a huge amount of money to reprint all their materials to put this magic number that they will get from the Charities Commission on to their marketing materials and signs. 
One National member of the select committee piped up and said: “Hang on a minute. If people are going to try to rip off New Zealanders and pretend to be a bogus charity aren’t they just going to make the number up? Won’t they just plonk some number on to the tin or the pamphlet and hold that out as being their official number?”. The officials and the Government members of the select committee said that—duh—that might be the case. It had not occurred to those members that if anybody did want to go and rip off some poor New Zealander that person would just make up the number. So thankfully that bit has been struck out. That will save charities a lot of money and a lot of difficulties. We live in a world where people can forge passports money and credit cards—and paintings in some cases—so it is not difficult to put a number on to a begging tin pamphlets or raffle tickets. 
Rodney Hide 
: If Helen Clark was convicted of forgery. 
KATHERINE RICH 
: Well yes if that clause had gone through she would not be able to be the treasurer of her local Plunket either I say to Mr Hide. 
So at least we see a few changes and struck out provisions here. But I would like the Minister in the chair to expend a few calories and get out of that chair to tell the people of New Zealand what mischief this legislation is aiming to solve because we have not seen clear evidence of bogus charities seeking money from New Zealanders. 
DAIL JONES (NZ First) 
: 
 I just want to have another go at looking at the two issues. I would be interested to see what Rodney Hide can find out about the Electoral Act in terms of whether if someone has been convicted of an offence punishable by more than 12 months it bars that person from being a member of Parliament. I doubt that very much. I think it may have something to do with being in prison but that is another matter. But that is not why I am raising this issue; I am raising it because it is quite clear that neither the struck out clauses 15(2)(c) and (d) nor the replacement clause 15(2)(c) is perfect. That is the obvious situation. The replacement clause 15(2)(c) which the majority of members of the Social Services Committee put in will allow a convicted fraudster to be an office holder of a charitable entity. Of course it does not surprise me in the slightest that the Prisoners Aid and Rehabilitation Society would want a fraudster to be involved in a society because that would seem to aid former prisoners to get back into their wicked ways and help themselves to the charity’s money. If we want to be ironic about it that is what a prisoners’ aid society may want. It was interesting to listen to Katherine Rich though. She seemed from everything that she said to support this bill although the National Party opposes it. 
I turned up to the select committee—I am not a regular member; I was filling in on the day of its deliberation—and I could see that there was something the matter here. The struck out clauses 15(2)(c) and (d) could have been amended to refer to an offence of dishonesty in order to get over the problem that has been raised quite correctly by another member of this Committee. Those clauses were so broadly drawn in the first place that they did catch a wide range of people who might not have been involved in dishonesty offences. The select committee has tried in the replacement clause 15(2)(c) to catch people involved in crimes involving dishonesty but that really links it to the Greens and the Criminal Records (Clean Slate) Act which referred to 7 years. That is the reason why the period is 7 years—it is because of that Act and the view of this Government that it should continue with the clean slate philosophy that if one has committed an offence 7 years ago one should be forgiven. 
That is all right for offences that do not involve a person going to prison but not when it involves offences like for example dishonesty within the meaning of section 2(1) of the Crimes Act. That includes false accounting. So if one was convicted of false accounting 8 years ago one can be an officer of a charitable entity. If one has counterfeited the charity’s seal in terms of section 261 of the Crimes Act “Counterfeiting public seals” yes one can be an officer of the society. That also applies if one has been involved in other offences involving for example using altered or reproduced documents with the intent to deceive. Now that is what one would do as an officer of a society with all that money. The offences include forgery and using a forged document—that sounds a bit familiar. In terms of those offences if one committed them 8 years ago one could be an officer of a society. 
I just say that neither the struck out clauses 15(2)(c) and (d) nor the replacement clause 15(2)(c) are perfect. But I think we would be better off to have the struck out clauses 15(2)(c) and (d) in the bill at the moment in the time that we have for this legislation rather than letting it run with the replacement clause 15(2)(c). The Government has an opportunity to either correct it now while the drafters are still here or leave that clause in and correct it in the fullness of time as soon as possible in the next 2 or 3 months. Otherwise we could be in serious problems. New Zealand First is not doing any deals. We will still support this legislation because the intent is right. But I think that the way the bill is worded means we will not solve the problem of charities having dishonest employees. 
Hon JUDITH TIZARD (Minister of Consumer Affairs) 
: 
 I thank members for their very useful contributions. I think it is a pity that Mr Jones did not have more discussions with the very good New Zealand First members who were present for the submissions on this legislation. If he had he would have heard about cases where for example a person helping to run an athletics club in which a charitable trust is involved may have a driving conviction or some issue of that sort. I think we want charities to be as free as possible to represent the communities for which they are working and for a range of people to be enabled. 
The point was made that many education trusts have been a means by which people have gone on into business and into self-employment in all sorts of ways. People get governance experience through community organisations. Sometimes they are trustees sometimes they are members of charitable trusts and sometimes they are not. The Government is satisfied that the provisions around who can and cannot be a trustee are satisfactory without prescribing exactly what people may have been convicted or not convicted of. The point was made that a member of parliament might be affected. I hope that the widest range of people will realise that working for communities is beneficial gives people a great deal of hope and energy in life and can often help individuals families and communities. The Government is very happy with the new state. I thank New Zealand First for its comments but I assure Mr Dail Jones that those issues were considered. 
On the issue that was raised by I think Katherine Rich relating to clause 26 I just point out that the deregistration power is discretionary—it is not obligatory. I would expect the Charities Commission to go through a range of choices and discussions with any charity before that charity is deregistered but the commission should have the power if it is clear that fraudulent behaviour is systemic in a charity to deregister that charity quite quickly. 
Of course all of that comes back to the fact that the establishment of the Charities Commission is a result of working parties discussion papers and a great deal of work going back—as Mr Copeland has very helpfully pointed out—to the 1980s. It is a result of the voluntary sector’s desire to have a commission that is separate from the Government. In the first instance it will clearly be funded by the Government but it will be separate from the Government. That matter was discussed in some detail and at some length in the Social Services Committee. The commission will be independent. It will have the responsibility of educating enabling and providing support and information to charities. 
I thank members of the Committee for their useful comments. I hope that this new legislation will be what hundreds of organisations have asked for and will be of service to the thousands of charities that serve New Zealand so well. 
DAIL JONES (NZ First) 
: 
 I should have mentioned that I have put forward another amendment. Clause 15(2)(c) ends with the words: “… and has been sentenced for that crime within the last 7 years:”. I have put forward an amendment to remove those words so that the clause would simply relate to: “(c) an individual who or a body corporate that has been convicted of a crime involving dishonesty (within the meaning of section 2(1) of the Crimes Act 1961) …”. 
We are talking about dishonesty. We are not talking about Springbok tour protests. If someone has been involved in a Springbok tour protest that is fine—that person can be a trustee. A person who has been convicted of driving while disqualified can be an officer of a charitable entity. Any conviction that does not involve dishonesty is fine; it does not debar a person from being an officer of a charitable entity. 
If members do not want to vote for my amendment to leave struck out clauses 15(2)(c) and 15(2)(d) in the bill I have just offered the better alternative of deleting the last few words from new clause 15(2)(c). The Government may care to think about it again. The offences referred to in section 2(1) of the Crimes Act are serious offences. We are not talking about minor crimes of dishonesty. Theft is there receiving is there—we are talking about 7 year - type offences. I think that the final words in clause 15(2)(c) could be removed and that members and other people who have admitted their involvement in non-dishonesty situations could still be officers of a charitable entity. 
The question was put that the following amendment in the name of Dail Jones to clause 15 be agreed to: 
to insert after subclause (2)(b) the following new paragraphs: 
(bb)a person who has been convicted of an offence punishable by imprisonment for a term of 2 years or more: 
(bc) a person who has been convicted of an offence punishable by a term of imprisonment of less than 2 years and has been sentenced to imprisonment for that offence: 
Amendment not agreed to. 
The question was put that the following amendment in the name of Dail Jones to clause 15 be agreed to: 
to omit from paragraph (c) of clause 15(2) the words “and has been sentenced for that crime within the last 7 years”. 
Amendment not agreed to. 
The question was put that the amendments set out on Supplementary Order Paper 357 in the name of the Hon Judith Tizard to Part 2 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to 
. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendments agreed to. 
A party vote was called for on the question  
That Part 2 as amended be agreed to 
. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Part 2 as amended agreed to. 
Part 3 Miscellaneous matters relating to Commission and other miscellaneous matters 
KATHERINE RICH (National) 
: 
 I would like to turn listeners’ attention to clause 82 “Minister’s role”. This is a rather disturbing clause because it lays out the role of the Minister in relation to this new organisation and in particular the Minister’s role in relation to the appointment and removal of members of the commission. What I think we will see once again is the appointment of Labour Party friends to this commission so that the commission will be a poodle before it even starts. 
This part of the bill also sets out what directions the Minister can give to the commission and the fact that the Minister can review the operations and performance of the commission. This part of the bill should send a shiver down the spine of every single charitable organisation in New Zealand. This is where the cold clammy hand of the Government starts to interfere with the role of the Charities Commission which in turn will interfere with the role of charities up and down this country. If this clause were not scary enough we need to turn to clause 123 “Minister may conduct review” which states: “(1) The Minister may review the operations and performance of the Commission at any time.” The moment the Minister wants to get in there and interfere bully a few members get a few decisions she or he can review and conduct a performance investigation at any time. 
So what we have here is the Minister’s ability to get involved with the commission to interfere to make this commission its lapdog for the Government so that this bill can achieve its ultimate goal which is to get Government involvement and control over 37000 charitable groups that currently enjoy autonomy. This bill is designed to make sure that the Government can start to interfere at a level we have not seen. This is the part of the bill that introduces politics to the Charities Commission. This is where we will see people who have perhaps delivered pamphlets for the Labour Party for the last 20 years being appointed to a wee job that they can oversee as a reward for their service to their political party. 
This part of the bill is particularly disturbing. The Minister needs to explain how these appointments are to be made that they will be independent that the appointees will not be Labour Party friends but people who hopefully are community representatives people who have had some involvement at least with the voluntary sector and that they are people who will do a good job once this bureaucracy is set up. This part of the bill introduces the costly part of the bureaucracy because it is all about who goes on the board what they are to be paid how they are to be appointed what the requirements will be and what the Minister can do to interfere in that particular role. 
The Minister must explain to the Committee what she sees as being her role because at the moment in black and white it looks pretty extreme. Under this legislation she can give directions to the commission. She can decide what she wants the commission members to do at any point in time. If they do not play ball she has the ability to go in there and review the operations and performance. Anybody who has been involved in an organisation knows that that is often a bullying tactic of Labour Ministers: “If you do not play ball we’re going to go in and audit you and conduct reviews until the cows come home so that we can get you to do as we say.” 
What we have seen in this part is very very concerning. This part of the bill is designed to add additional bureaucracy. 
RODNEY HIDE (Leader—ACT) 
: 
 What we see in this part is the direct control of the Charities Commission coming under ministerial persuasion. Ms Rich is quite right. This is what should upset the charitable organisations because we ask ourselves: what sort of direction will be provided? Here we come to the window that we have recently had on this Labour Government the make-up of this Government and the sorts of people who will be given this direction and making these appointments. We have learnt that they are dominated by unionists so it is a very very narrow sector of New Zealand that will be directing the Charities Commission. 
We know that the most powerful group within the Labour Party and hence the Labour Government is what Mr Tamihere calls the “Wimmins Division”. I look across the Chamber and I can see all the members here tonight. We know that the people who are dominating the Labour Government do not have families according to Mr Tamihere and he should know. He says that they just sit around “parlez vous” drinking their lattes and plotting and planning. Those are the sorts of people who will be making these appointments and giving directions to the Charities Commission. We know from Mr Tamihere that the people who will be giving the directions are smarmy and have no substance. One can listen to them for 2 hours take lots of notes and learn nothing. We have certainly seen that in this Chamber tonight. 
We have learnt from Mr Tamihere that the people who will be setting up and running this commission are duplicitous and that they cheat the likes of the United Future party by changing words. These again are the people whom the commission will be stuck with—people who are duplicitous. We hear from Mr Tamihere that the people who will be setting up this commission are tossers. That is what he said. 
The CHAIRPERSON (Ann Hartley) 
: I say to Mr Hide that that word has been ruled out as unparliamentary. 
RODNEY HIDE 
: I am sorry. I did not realise. 
The CHAIRPERSON (Ann Hartley) 
: Would the member withdraw it please. 
RODNEY HIDE 
: I withdraw. I am sorry; I did not realise. 
Katherine Rich 
: Caber tossers. 
RODNEY HIDE 
: A cabal of something and we heard this from— 
Hon Pete Hodgson 
: No Celtic history in that guy. 
Jill Pettis 
: He would have ended up in the haggis. 
RODNEY HIDE 
: Mr Tamihere did not make the half of it did he. What a mean miserable little party it is represented by Jill Pettis. It is no wonder poor John Tamihere rushed off to Ian Wishart to bare his soul. What would it be like to be locked up in a room with the craven women on that side of the Chamber and have to put up with their cheap jibes? I am not surprised that the poor fellow is under stress. 
Jill Pettis 
: How many times have you won your electorate? 
RODNEY HIDE 
: That again is the sort of fisticuffs the intimidation the claws that poor old John Tamihere is suffering under. Then they say that he is a red-blooded heterosexual male and that he is stressed and in need of psychiatric help. How could he not be if he is sitting with Jill Pettis Judith Tizard Helen Clark Heather Simpson and Marian Hobbs? That would drive anyone to a psychiatric institution. I am amazed that John Tamihere lasted as long as he did. There are no other members in that party who have any red blood going through their veins. 
The CHAIRPERSON (Ann Hartley) 
: The member will come back to the bill please. 
RODNEY HIDE 
: I am talking about the bill. I do not know why you think I am not because I am saying that if we look at clause 82— 
Hon Pete Hodgson 
: Don’t challenge the Chairperson. 
RODNEY HIDE 
: There is Pete Hodgson saying not to challenge the Chairperson. He is sitting in his seat not taking a point of order. He is useless as usual. He said that if I sat down he would take a call. I sat down. Did anyone see him take a call? No. He does not even know what we are debating he is so useless. 
Lianne Dalziel 
: Talk to the bill. 
RODNEY HIDE 
: Now we are hearing from Lianne Dalziel. The poor girl. She is stressed. She got sacked. What did she do? Actually not much. She has not been forgiven but John Tamihere is back in the fold. [ 
Interruption 
] Now she is calling out for me to talk to the bill. If she would shut up I would. It is no wonder that John Tamihere is in a psychiatric institution with that sort of carry-on. I am talking about clause 82 and the sorts of people that the likes of Lianne Dalziel would be appointing to run the commission and get their sticky little fingers on 30000—[ 
Interruption 
] John Tamihere will be. 
The CHAIRPERSON (Ann Hartley) 
: The question is that the Minister’s amendments set out on Supplementary Order Paper 357 be agreed to. [ 
Interruption 
] The member will be quiet. [ 
Interruption 
] The member will stand withdraw and apologise. 
Rodney Hide 
: I withdraw and apologise. I raise a point of order Madam Chairperson. How come Lianne Dalziel can sit there and call out and the chair does nothing but if I respond the chair jumps on me and asks me to withdraw and apologise? 
The CHAIRPERSON (Ann Hartley) 
: What I heard and I certainly did not even hear another one—I could not hear it above the decibels emitting from the member— 
Rodney Hide 
: I raise a point of order Madam Chairperson. Why do you not ask Lianne Dalziel whether she called out when you started to put the question? 
The CHAIRPERSON (Ann Hartley) 
: I have ruled on the matter. 
Rodney Hide 
: I raise a point of order Madam Chairperson. With the greatest of respect I was responding to what Lianne Dalziel called out when you were taking the vote. You think it is OK to punish me—I notice that the Speaker asks a member whether he or she was calling out. 
The question was put that the amendments set out on Supplementary Order Paper 357 in the name of the Hon Judith Tizard to Part 3 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendments agreed to. 
A party vote was called for on the question  
That Part 3 be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Part 3 agreed to. 
Schedules 
The CHAIRPERSON (Ann Hartley) 
: Before I put the questions on the schedules I note that the Minister has an amendment to omit schedules 1 to 3. I will not put the question on that amendment as it is in direct negation of a question. It signals the Government’s intention to vote against those schedules being agreed to. 
LINDSAY TISCH (Junior Whip—National) 
: 
 I raise a point of order Madam Chairperson. I just want clarification. You said that the Minister wants to withdraw schedules 1 to 3. Is that right? 
The CHAIRPERSON (Ann Hartley) 
: My advice is that they still have to be voted down. I now put the question  
That schedules 1 2 and 3 be agreed to. 
Schedules 1 2 and 3 not agreed to. 
The question was put that the amendments set out on Supplementary Order Paper 357 in the name of the Hon Judith Tizard to schedule 4 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendments agreed to. 
A party vote was called for on the question  
That schedule 4 as amended be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Schedule 4 as amended agreed to. 
Clause 1Title 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Clause 1 agreed to. 
Clause 2Commencement 
The question was put that the amendment set out on Supplementary Order Paper 357 in the name of the Hon Judith Tizard to clause 2 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Amendment agreed to. 
A party vote was called for on the question  
That clause 2 as amended be agreed to. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Clause 2 as amended agreed to. 
Bill reported with amendment. 
Report adopted. 
Third Reading 
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. 
JUDITH COLLINS (National—Clevedon) 
: 
 That would have to be the most boring speech of the night from the most boring member. It is no wonder that David Benson-Pope cannot keep awake. We can imagine how boring it must be in their caucus—except when Mr Tamihere turns up upon which they all roll over and say: “Tickle our tummy Johnny boy.” and they go for it every single time. The great thing about John Tamihere is that he actually did in an act of charity give the Prime Minister the opportunity to show just how in touch with her feminine side she really is. 
I have looked at the bill and I have listened to some of the speeches tonight and we have had some really good speeches from this side of the House. I think of Simon Power’s comments on what happens when commissions are set up. He talked about what had happened to the Tertiary Education Commission under Steve Maharey the man whom Mr Tamihere very uncharitably and not in accordance with this bill called “smarmy”. I have gone a bit further—I have looked at Part 3 which contains a few of the core things this bill can do. I refer to clause 70 “Core things Commission can do” which states—guess what—“anything”! The clause states: “The Commission may do anything authorised by this Act or another Act.” 
The bill goes further. I shall read clause 71 “Other things Commission can do” because it is so exciting so narrow and so focused. It states: “(1) The Commission may do anything that a natural person of full age and capacity may do.” That actually is the power of general competence. The Government New Zealand First United Future and Jim Anderton’s party—whatever its name is—are giving to the Charities Commission the same power that they gave to local authorities and that resulted in people’s rates being put up including those of the elderly who cannot afford to pay their rates. That was all from the power of general competence. 
The commissioners who will be appointed by the Labour Government will be able to do anything they want to do—and guess who pays for it? Well the Minister stood up in the House and told us a really funny joke. She said that the Government will pay. The Government does not pay; the taxpayer pays. Every single cent that is signed off by any Minister in this House is paid for by the poor old taxpayer every single time. The Minister said that the Government will pay. Well it will not. Mr Copeland very kindly and trusting in the Hon Michael Cullen said: “We know it’s going to be OK because we will get a bigger deduction for charitable donations. 
I ask Mr Copeland whether that is right. Is it something like that? 
Gordon Copeland 
: Yes that’s right. 
JUDITH COLLINS 
: Well that is his hope. Even Mr Copeland has to say that that is the hope. Did Mr Copeland check the wording? Did he check every single little word? We know just how clever the Hon Michael Cullen is. We know it because Mr Tamihere said so and we know it because Mr Copeland has just confessed to us that that is what he is hoping. The good thing is that Mr Copeland may actually get what he wants now because Dr Cullen will be so keen to show that he is not as clever as that at all. 
We have heard some very interesting things. What we have heard from the Minister in this third reading debate is that the charitable sector asked for this bill. Well I do not know—I mean the Minister does not pay a lot of attention at select committees. The Minister does not pay a lot of attention anywhere. We could see by her lack of passion and drive—and everything else that she put into this bill—that she does not really know anything about it. What she actually said was that the charitable sector asked for it. Well not one of the submitters actually asked for it. Not one of the submitters we heard from asked for it at all. What they said was that they are frightened they will get loved to death by this commission. They are frightened that they will be stood over by people who do not care about the voluntary sector; people who are busy sitting in cafes “parlez vous”—that was the term was it not I ask Mr Hide—and drinking their lattes; people who do not care about the ordinary New Zealand mum and dad who have to try to find the money for the sports fees and sports equipment. A lot of these fees are now paid for by the charitable institutions that this Government wants to love to death—in other words clasp them to the Minister’s bosom and then suffocate them by regulating them out of existence. 
Hon Members 
: Ha ha! 
JUDITH COLLINS 
: It is true. We could laugh about that but it is utterly true. That is what happens. We know that there are lots of volunteers who are scared of this bill. They are scared that they will get into trouble because of something someone else does. They are petrified. They came to us and said that they are not going to volunteer anymore. They do not want to because they are scared. The Green member Sue Bradford said that she has heard exactly the same thing. 
I have spoken tonight about what would have happened to the Problem Gambling Foundation if this bill had been in effect at the time they lost a huge amount of money to a thief. It would have been in danger of being closed down. The Minister stands up here in the House and says: “Oh well it’s all discretionary”. I ask the Minister what it is discretionary upon. Is it discretionary upon whether one is mates with the Minister? Is it discretionary upon whether one is mates with someone in the Labour Party? We know that that is what the discretion is because the commissioners will all be party appointees and not one of the Labour members will actually say: “We wouldn’t do that.” When we look at the bill we see regulation for regulation’s sake. The Minister said that we have to stop anyone using charities to rip off people. Well we already have a law. It is in the Crimes Act. It already is an offence to rip off people using charities. We do not need to have another law. We do not need to have a law for anything that moves. 
I have taken on board some of the points that Mr Jones has made about people who have been dishonest within the last 7 years and whether they should be trustees. Well I guess I am a bit kinder than Mr Jones. I accept that I may be an old softie on these matters but I do actually believe that some people have the ability to be rehabilitated. 
Katherine Rich 
: So does the Prime Minister. 
JUDITH COLLINS 
: And so does the Prime Minister. She believes it as well Mrs Rich says. In fact I understand that one can be rehabilitated— 
Katherine Rich 
: In 2 days. 
JUDITH COLLINS 
: In 2 days. That is all it takes as well as a bit of stress leave. In fact one is rehabilitated even before one takes the stress leave. 
I believe that people can be rehabilitated and I do not like to think that just because someone has a criminal conviction he or she will forever be stopped from contributing in a positive way to society. So on that basis I did not support Mr Jones’ amendment. We should not be convicting people before they have actually committed a crime and that unfortunately is what we do when we say that nobody who has committed a particular crime will be able to be in a position of responsibility in relation to a charity. It would be far more sensible to be able to say that we cannot trust that Government in spending taxpayers’ money. Fortunately I think the people are about to say that. 
JIM PETERS (NZ First) 
: 
 I raise a point of order Mr Speaker. The last speaker in her opening remarks slurred the New Zealand First Party which did not vote for the Local Government Act 2002 and therefore was not responsible for the charges that she said resulted from that Act. 
JUDITH COLLINS (National—Clevedon) 
: 
 I am happy to withdraw and apologise for that in relation to New Zealand First. 
DAIL JONES (NZ First) 
: 
 It is not often that I have the opportunity in Parliament to support legislation that when I was in legal practice I wanted to see introduced as I have with the Charities Bill. As I said earlier when I was in legal practice and forming charitable trusts under the Charitable Trusts Act for various people I became concerned that the Act had no real means of dealing with people who robbed money from charitable trusts or who just did not operate them satisfactorily. Members will recall that in the early 1980s when National was in Government and I was in Parliament—and in the later 1980s as well—there were all sorts of groups setting up charitable trusts under the Charitable Trusts Act especially Maori groups for employment schemes. When I set up a few of those I was concerned that people were getting money from the Government and there did not seem to be any control on those charitable trusts as to what would happen. 
We have heard recently about ACT’s concern about the lack of control over Te Wananga o Aotearoa. I would have thought that ACT would support this legislation in order to make sure that there are real controls over how money goes to the various trust groups and I am disappointed that ACT is not following up some of its allegations by supporting the legislation. 
I have had concerns about this issue. I wrote to the Minister of Justice in the early 1990s about it. I got a report that went back to 1979 which set out a court case from 1967 in which Justice Gresson expressed his concern about charitable trusts. In that report there was a concern from the National Council of Churches as to the way in which charitable trusts and charities were being operated. 
I have had a long-felt regard and concern about the way in which charities have been operating improperly and without any adequate supervision. So I was delighted when this bill was introduced to the House and I am even more delighted by the changes that were made in the Social Services Committee as a result of the committee giving good consideration to the bill. I mention to the Minister that New Zealand First had a subcommittee on the bill that consisted of myself and Mr Gudgeon. I spoke on the first reading and because of my interest he and I communicated regularly on the bill and I kept a close watch on it. So when I had the opportunity to be present for the final deliberation of the bill I took it with both hands. 
I believe that in Opposition one does not oppose just for the sake of it. If one sees something that is good coming forward one should support it. As Martyn Finlay would say it is not just a question of opposing it is also a question of proposing. In this legislation something that I have had a great concern about for some time is being remedied. There has been a mischief—a Judge of the High Court and the National Council of Churches have said that there was a mischief—and I am sure that the Government would not have introduced this legislation if there had not been some form of mischief because otherwise it would have been a complete waste of everybody’s time and most Governments do not tend to waste taxpayers’ money as freely as that. So I am delighted by the bill coming into the House. 
I have just one criticism of the bill that I think is important but I was not about to spit the dummy out and throw my teddy bear out of the pram just because I did not get my way on that issue. But I think the Government will have to do something about it fairly soon. The Government had originally intended clause 15(2) to state: “(2) The following persons are disqualified from being officers of charitable entities: … (c) a person who has been convicted of an offence punishable by imprisonment for a term of 2 years or more: (d) a person who has been convicted of an offence punishable by a term of imprisonment of less than 2 years and has been sentenced to imprisonment for that offence: …”. The Government and the select committee decided to take that provision out because groups like the Prisoners Aid and Rehabilitation Society said that plenty of people had been convicted of disorderly offences—perhaps while opposing the Springbok tour or for driving while disqualified—that are not dishonesty offences and that that provision covered them. 
Then the Government came up with this alteration. In place of that provision it would put in clause 15(2)(c) which states: “(2) The following persons are disqualified from being officers of charitable entities: … (c) an individual who or a body corporate that has been convicted of a crime involving dishonesty (within the meaning of section 2(1) of the Crimes Act 1961) and has been sentenced for that crime within the last 7 years:”. That means that anyone who has been convicted of that crime 7½ years ago can be an officer of a society. That includes people who have been convicted of receiving blackmail theft or stealing theft of animals and theft by spouse. I am referring to the sections in Part 10 of the Crimes Act regarding the conversion of vehicles breach of trust the punishment of theft the power of search etc. 
When appointing someone to a trust one wants someone who has not committed a breach of trust. But this Government will allow people who have been convicted of the offence of breach of trust 7½ years ago to be officers of a charitable entity. That just does not seem to me to be right. 
Hon Mark Burton 
: There has to be the possibility of rehabilitation. 
DAIL JONES 
: Yes there has to be the possibility of rehabilitation. But as Judith Collins said when she was being critical of a trust that may get into difficulty and she was considering what could be done a trust is likely to get into difficulty because some fraudster forger or thief is a member of it and has fallen back into his or her old ways again. That is the case. 
We are not talking about people who have committed minor offences. We are talking about people who have committed serious offences and this Government is saying that those people can be officers of a trust. We in New Zealand First take a tougher line in some areas. As has been asked in this Chamber if people steal from a trust where is the indemnity for the other members of the trust? It all goes. 
One of the concerns has been the question of indemnity. Who will indemnify the other people in a trust if that money goes down the tube? I have raised the issue. I have received no support from the Government. The Minister—as she is entitled to do—offered no support. I suggested that the words “and has been sentenced for that crime within the last 7 years” be removed so that clause 15(2)(c) would relate to anyone who has been convicted of an offence under section 2(1) of the Crimes Act. I did not receive support. I suggested that the original clauses 15(2)(c) and (d) should go back in because that was the Government’s original intention. That is what the Government wanted in the first place. 
So I have given the Government all the options. For the purpose of the third reading I just record that that was what happened at the Committee stage—which is one of the reasons for a third reading debate; it used to be the case and I am sure it still is. If something goes wrong I will say: “I told you so.” especially if a substantial trust has to be wound up as a result of a former criminal defrauding it. 
The Prisoners Aid and Rehabilitation Society said to us that we should be lenient and we should make sure that prisoners who had been found guilty of forgery and suchlike had the chance to redeem themselves. But there is too much hard-earned money involved. People have knocked on doors to collect that money. They work extremely hard. There are people at the other end of the chain who deserve that money and I do not believe that there should be any risk of it being lost. After all the Government has put a time limit in the provision of 7 years. It considers that people should not be on a trust if they have been sentenced for a crime within the last 7 years. I am merely saying that they should not be on a trust at all. 
I disagree entirely with Judith Collins. She can be soft on this if she likes but New Zealand First takes a hard line on law and order issues. We are concerned that people with records will be on a trust. At the moment there is a land transport bill is there not that relates to people who have committed offences. The Government is saying that those people should never be able to have a land transport licence and that they should have no right of appeal. That is how tough the Government can be. Why is the Government not being equally as tough on forgers receivers and other people who have committed dishonesty offences particularly in respect of charities for which people go to a lot of trouble to raise money? Not only could a trust lose money but it could lose everything else as well. 
I just raise that issue. As I said New Zealand First will not die in the ditch on it. We believe in the essential principle of the bill. We wish all charities well. We ask them to be extremely careful about whom they employ—although once again the Criminal Records (Clean Slate) Act will make it difficult for them to ensure that the people whom they employ have not previously been convicted of a dishonesty offence. There are a couple of barriers for all employers but as far as a charity is concerned there is an even bigger one. 
JILL PETTIS (Labour—Whanganui) 
: 
 I commend Dail Jones for his speech. We sometimes see piffle on the front page of our newspapers and in the lead stories on the 6 o’clock news that means absolutely nothing and has nothing to do with improving people’s quality of life yet the cooperative approach that has been taken for most of this evening by all members of Parliament in trying to pass legislation that will be of benefit to the people of New Zealand will not get mentioned even on page 19. I just say to Mr Jones that I enjoyed listening to his speech. 
The tone will drop now because I will refer to those comments made by Judith Collins. I say from the outset that National members and Judith Collins in particular would not recognise people from the charitable or voluntary sector even if they ran over them. Judith Collins in her Jaguar—well I do not care what she drives; I will just say that she would not recognise them if she ran over them. She is the very same member who has made comments that sole parents sit around watching videos and TV all day and smoking dope. That is an indication of how much she knows about people who are perhaps at the lower end of the economic scale and she has no idea about people who are trying to improve the lot of others in a very humble but very effective way. 
I also remind the skeleton crew on the other side of the House tonight that Nick Smith when he was in that ill-fated National Government threatened the voluntary sector with the removal of its funding if it spoke out about and against the National Government of that time. He threatened the sector with the loss of funding. A lot of those people—and a lot of people whom we on this side of the House know well—were genuinely frightened about that. That was the kind of intimidation that was brought to bear during the last National Government. 
Even before then Mr Muldoon withdrew the charitable status of CORSO because it spoke out about the evils of apartheid. Some people will not remember those kinds of things. Some people will not even remember the huge amount of international activity that took place to rid South Africa of apartheid. The mean Prime Minister of New Zealand at the time Mr Muldoon reacted by crawling to Margaret Thatcher and treated CORSO cruelly. That is something many people in New Zealand will always remember. Of course some johnny-come-latelies will have absolutely no recollection of that history at all. 
This bill is a good bill because firstly it is an initiative that will acknowledge the vital contribution that the charitable sector makes to the New Zealand economy and to the well-being of New Zealand and New Zealanders. This Government in support of this Charities Commission has committed $9.8 million of funding to help the commission in its initial stages. 
One very important aspect that has not been mentioned very much tonight is that the charitable sector has approached the Government a number of times over recent years about income tax benefits for charities and for people who make donations and quite rightly so. The Government will be in a position to assist because it will now be able to assess how much an increase in the form of taxable assistance would cost and how much it would assist those various organisations. It is critically important to have robust information about the size and scope of the charitable sector in New Zealand and it has traditionally been quite difficult to collect or assess that information. 
This is a good bill because it will protect the integrity and reputation of the charitable sector. I just want to pay my respects and express appreciation to the hundreds of thousands of people who go out and do voluntary work every day in a humble but hugely important way. 
SUE BRADFORD (Green) 
: 
 I would like to take a short call in the final stage of this debate firstly to acknowledge everybody in the House everybody on the Social Services Committee and the officials who were involved in putting the Charities Bill together. Although I feel really sad about the opportunity we have missed with this bill I feel at the same time—as we saw on the select committee and as we can see in the debate tonight—that MPs from both sides of the House have engaged with the debate and recognised the significance both of the bill and of the community sector it deals with. That is a good thing. 
But I think it is a real pity that the Government in the end did not have the courage to accept that the fundamentals of the bill were flawed from the start and in particular that its very beginnings and very flawed consultation processes meant that it was not going to build at any point the kind of trust needed between the Government and the sector to make something like this really work well. 
We had submissions hundreds of them from all parts of the sector—from what I would call the very conservative end of church groups mission groups priests and nuns right through to groups at the other end of the scale the sort of groups that I might have come from. We also had groups like the Tindall Foundation which is probably respected by every party in this House as a very significant philanthropic body in this country. Tindall Foundation representatives came to us and said that the best thing we could do with this bill was to chuck it out and start again and to learn from the experiences of places like the UK and not be so silly as to go ahead with a bill that to make work we would have to amend and amend in almost every clause. In fact that is what has happened so we have this piece of miscegenation and that is a real pity. 
Even after the select committee had made its rather fumbling amendments the Government restarted a small consultation process which succeeded only in annoying a whole lot of groups around the country a whole lot more because only a few groups were involved and brought to the table. Groups in the north of the country retained a heap of concerns as did others in the South Island. 
There were concerns such as why the meaning of “charitable purpose” had not been dealt with and brought up to date and ongoing concerns about the threat to the independence of the sector particularly in relation to advocacy. There were concerns about the functions of the commission and in particular that its potentially good role in playing a developmental role with the sector would be subsumed into its regulatory and policing role. There were issues relating to the payment of trustees—for example in respect of bogus charities such as some primary health organisations where trustees can receive very substantial payments but the organisations are still seen as not-for-profit. Those kinds of issues that are very real in the sector are just not dealt with by this bill. 
There are ongoing concerns about the lack of detail and the information provided during the consultation processes and I know there has always been an anxiety about what will happen once this bill is passed in terms of its regulation-making powers and what kind of consultation will actually happen at that point. That is really getting down to the nitty-gritty. 
Just recently too there have been changes announced by the Government about proposed alterations to the Financial Reporting Act. Financial disclosure under the Charities Bill will be determined by the Financial Reporting Act’s requirements which are still subject to work by the Ministry of Social Development. What is all that going to mean? We do not know. None of the community sector organisations in the country know. We do not really know what we are passing tonight or what the implications are and will be for the financial reporting requirements of all those groups in the future. 
Just this week we had an announcement by Cabinet on Monday—which stunned many parts of the community sector—of its sudden withdrawal of support for a body whose establishment the sector had spent 5 years working through with the Government. The new national entity had been backed by the Government but in one day that support was withdrawn. I do not know how some of the groups that might have supported this bill may be feeling tonight about the relationship between the Government and the sector. It has certainly not been a fantastic trust-building process. 
There has not been at any point comprehensive analysis of the genuine need for or real cost of the proposed legislation nor has the Government really ever had a clear understanding of what the bill seeks to achieve and how. What we have ended up with tonight is a far cry from what could have been a really empowering and enabling piece of legislation supported by all the different groups and by MPs across the House. I believe it is most unfortunate that the Government still appears not quite to understand what an excellent opportunity it has missed. 
RODNEY HIDE (Leader—ACT) 
: 
 The message from this Government to the charitable sector is a simple one: “We won. You lost. Eat that!”. Here is a Government rushing through legislation under urgency that Sue Bradford who is an expert in this area says she does not understand and the charitable sector does not want. But what does this Government care? 
We heard the Minister responsible Judith Tizard give a speech—actually saying “speech” is dignifying it. She stood up in this House and gave the worst speech I have heard her give. She just mumbled into the Prime Minister’s handbag. I do not know what was going on—whether it was that she was so embarrassed by this bill. Then we heard Jill Pettis whom John Tamihere has nicknamed “Paint Stripper” because of her voice— 
Hon Member 
: What! 
RODNEY HIDE 
: I know she knows. I have news for the Labour Government! John Tamihere is talking to the media again. It is going to be great. He is actually giving “on the record” interviews again about his colleagues and repeating everything so there will be some fun in the weeks ahead. But we heard from Jill Pettis— 
Jill Pettis 
: I think you are obsessed with me. [ 
Interruption 
] 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Order! 
RODNEY HIDE 
: I am not sure I can go on. Could I take a minute to recover? 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Yes you can. I have not taken it off your time. 
RODNEY HIDE 
: That is a shocking shocking thing to say. I raise a point of order Mr Speaker. I take deep offence at the comment that Jill Pettis made. I consider it to be an insult and offensive and I ask that you ask her to withdraw and apologise. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Sorry Mr Hide. At what point did she make that comment? 
RODNEY HIDE 
: The thought that I could be obsessed by her. 
Opposition Members 
: Obsessed with her. 
RODNEY HIDE 
: Oh the thought that I could be obsessed with her! That is deeply insulting and offensive and I take offence. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: You have taken offence? 
RODNEY HIDE 
: Yes. I have a reputation to protect. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: The member has been offended by what Jill Pettis said. I ask her to withdraw. 
Jill Pettis 
: All right I apologise. 
RODNEY HIDE 
: God knows there are girls in Parnell who could be listening! 
What we have heard from this Government tonight absolutely backs up what John Tamihere has been telling us and telling the nation. Mr Gordon Copeland got up and said that he does not like this legislation but will vote for it because he hopes that if he does vote for it Dr Cullen will lift the tax-free threshold for charitable donations. That is what I understand Mr Copeland to be saying—that he would vote and hope. 
Then we heard from the Minister in charge of the bill Judith Tizard. She got up mumbled away into the Prime Minister’s handbag and said that the reason for this bill is so that the Government can collect information about the charitable sector. That is very interesting. What is the Government going to do with this information? [ 
Interruption 
] She went on to explain I say to Mr Copeland that it is to figure out how much it would cost if it lifted the threshold for tax-free donations. She is nodding her head—that is exactly what she was saying. Gordon Copeland is voting for this legislation in the hope that the Government will gather up information figure out what lifting the tax-free threshold will cost and Michael Cullen will then reward the charitable sector with some extra tax perks. That is the basis for Gordon Copeland’s vote. It is a case of vote and hope—let us collect the data and hope. I think Mr Copeland has been duped. [ 
Interruption 
] He says there is nothing wrong with being duped. Well he may think that but I think there is a problem with being duped. 
Hon Rick Barker 
: That member would know about duping people. 
RODNEY HIDE 
: Is that not great! Here is the Labour Party talking about my duping people. This is coming from a party that has Steven Ching at No. 42 on its list. Talk about being duped! 
Hon Judith Tizard 
: Where was Donna Awatere Huata on your list? 
RODNEY HIDE 
: She is gone—that is where Donna Awatere Huata is on our list. After the Labour Government gave her $2 million we got rid of her. Where is Steven Ching? He is coming in and he is a man who lies to people— 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Order! 
RODNEY HIDE 
: —and obstructs justice. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Order! 
RODNEY HIDE 
: What is that Mr Assistant Speaker? 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Was the member referring to a member in the House? 
RODNEY HIDE 
: No—Mr Ching. He lies. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: All right but can I in that case explain— 
RODNEY HIDE 
: He is a total liar and a total crook. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: I ask Mr Hide to make some reference to the bill. 
RODNEY HIDE 
: Yes—we are talking about being duped. 
Hon Paul Swain 
: Let’s talk about Fiji. 
RODNEY HIDE 
: Do we not just love Mr Swain! He wants to talk about Fiji. Labour’s line is this: “Let’s talk about Fiji but when it comes to John Tamihere we want to put a line under it and move on!”. Mr Steve Maharey says that he did not get an apology or a retraction. John Tamihere called Steve Maharey “smarmy” and he hates that. He considers John Tamihere to be a liar and now he says he just wants to put a line under it and move on. That is what Mr Maharey No. 3 on the list says. 
I can understand the concern that those in the charitable sector have. They are saying that if someone comes into one of their organisations and he is a crook that person can actually get the whole charity deregistered. I want to explain to the Labour Party how easy it is to get members who are crooks coming into a charitable organisations. The Labour Party should know should it not? Labour has Steven Ching at No. 42 and I can tell the Labour Party members that they will learn a lot more this Sunday about their No. 42 Mr Steven Ching the man who was selling seats to sit beside Helen Clark for thousands of dollars. 
Judith Collins 
: They want their money back! 
RODNEY HIDE 
: Yes. Then there was the matter of obstructing justice. Did the Labour Party know about that? Did Labour members know about the fact that John Tamihere had pleaded guilty in the High Court to two counts of forgery and two counts of uttering? 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: We are debating the Charities Bill. 
RODNEY HIDE 
: Yes and what we are talking about—and it is right on; this is a third reading speech—is wrongful behaviour. I am just saying how easy it is for a charity to get someone on board who is less than savoury. I ask members to look at the Labour Party. It has got itself stuck with John Tamihere and it has got itself stuck with Mr Steven Ching who is No. 42 on its list. If that is what can happen in the Labour Party we can imagine what can happen to for example the New Zealand Prisoners Aid and Rehabilitation Society. It could happen there and that society could end up being deregistered. I think Mr Maharey knew all along what Mr Tamihere was like. He nods his head. He knows exactly what Mr Tamihere is like. 
We have a bill here that affects the charitable sector—37000 charities. It is true that about 500 of them were set up by Mr Tamihere. But 37000 charities are going to come under this regime with seven appointments from the Labour Party to set up the commission and a team of bureaucrats to run around and monitor inspect and collate information. Those members talk about putting $9.8 million into it. That will actually be a drop in the bucket compared with what it will eventually cost. 
Let us think of any one of those charities and what it could do with $9.8 million! Let us think about the good works that could be done with $9.8 million! It will though all go just on bureaucracy. That $9.8 million will be spent on making more work for the charitable sector. That is what will happen. 
Hon Steve Maharey 
: What? 
RODNEY HIDE 
: Steve Maharey yells out “What?”. I know that Mr Steve Maharey can talk for 2 hours and if one takes a page of notes all it is is clichés and hackneyed policy words but there is no substance. We know that because his former Associate Minister John Tamihere told us. He summed up Mr Maharey rather well—I thought it was perfect. He said he was smarmy. Do members notice how smarmy his interjections are? [ 
Interruption 
] Oh he wants to be slimy rather than smarmy. Maybe he is slimy and not smarmy. I do not really know but I know that what Mr Tamihere had to say was not very nice—and it was the truth. I say to Government members that they should listen to John Tamihere a bit more. They should not just go around liking him because he gives 150 percent. They should not just go around saying: “When he’s good he’s really good but he has the odd stumble.” They should listen to what Mr Tamihere is saying. He is telling Labour members that they are out of touch. 
Jill Pettis 
: Oh he’s scoring another 2 percent. 
RODNEY HIDE 
: That is “Paint Stripper”—Jill Pettis from Whanganui. That is what Mr Tamihere has gone around the gallery and said tonight. 
Hon Mark Burton 
: Oh that’s original. 
RODNEY HIDE 
: Mark Burton confirms that he has heard it before. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Order! 
RODNEY HIDE 
: It has been going around for years according to Mr Mark Burton. Labour members should listen to what Mr Tamihere is saying. 
They should think about the charitable sector which is there to look after families which this Government knows nothing about. They should listen to families and to hard-working New Zealanders. My goodness! As my colleague Sue Bradford said Labour should just listen to the charitable sector. But oh no Labour members are sitting around supping their lattes talking parlez-vous and not listening—just plotting. 
GORDON COPELAND (United Future) 
: 
 I am pleased that the Charities Bill will receive its third reading this evening and become the law of the land. Let me say just for the record that the Social Services Committee which I was on—it sounds like it was a different one from the one Sue Bradford or Judith Collins was on—actually heard 743 submissions from organisations that collectively would have represented thousands of New Zealand charities and virtually all of those submissions said that they felt the time had arrived for the establishment of a charities commission. So the concept of a charities commission has the overwhelming support of the charitable sector. 
I thought that in this third reading debate it would be worth just pausing for a moment to think about the wonderful benefit that not only our nation but the world derives from charities and I want to refer to the tsunami in east Asia which has occurred since the first reading of this bill. It is almost inconceivable to think of how the world would have responded to that disaster without the assistance of charities. We think immediately of organisations such as the New Zealand Red Cross Society Unicef World Vision Christian World Service Caritas Aotearoa - New Zealand and The Evangelical Alliance Relief Fund or “Tear Fund” for short. 
Here were charities that within hours of that disaster were responding not only by asking Kiwis to help—and Kiwis are very very generous—but also by getting people on the ground to deliver goods and services medical care comfort and so on to the hundreds of thousands of people whose lives will never be the same again after that enormous event. 
Kiwis are generous people. There would be many people who in response to that tragic disaster would have given over and beyond their regular giving to charities yet under the present law they get a measly tax rebate on doing so of just $630 per annum and that needs to change. Governments should encourage greater giving through higher rebate levels. We need to remember that for each extra 33c given up by the Government the charity receives an extra $1. If for example the Government gives up $20 million it will be because Kiwis have given of their own free will an extra $60 million to charities. 
The fact is that such giving is an efficient and effective investment in the social development of those countries that are its recipients. If given to developing countries it has the potential to transform the lives of others particularly in those countries that are desperately poor. I have only to mention for example the Fred Hollows Foundation or mercy ships and immediately images come to mind of the medical miracles that result for people who were blind or near blind who can see again and the deformed and crippled children often outcast by society whose lives are transformed with life-changing and lifelong positive consequences. 
Again I ask the Government to take note. It now has the Charities Commission; it is up to it now to improve the tax rebates and concessions that it gives to encourage Kiwis in their natural propensity towards generosity. 
Charities are also looking for the refundability of imputation credits. On introduction the original purpose of imputation credits was that the final tax paid would be equal to the marginal tax rate of the recipient shareholder. Well the marginal tax rate of those charities that have shares in New Zealand companies is zero. So why do they pay 33c in the dollar as a final and non-recoverable tax because they cannot claim back their imputation credits? It is wrong and it is blatantly unfair especially when non-resident companies—that is commercial organisations not charities—can now get an imputation tax refund. 
Additionally so long as charities can receive interest income without tax deduction—and there is no suggestion that that would change in any way as is right and proper—they should also of course not be paying imputation tax on company dividends at 33c in the dollar because that fundamentally distorts investment patterns by charities so that decisions become tax-driven rather than market-driven something that directly contradicts not only common sense but the policy advice given to the Government by Treasury. Charities will also want to see that fixed in this year’s Budget. 
In conclusion the passage of this bill is a landmark in the evolution of the New Zealand charitable sector. It is a sector that has served this country well since the foundation of our nation. My hope is that it will continue to flourish in the years ahead that there will be an increasing appreciation by New Zealanders of the valuable work that it does and that the Government will do its bit to encourage that to happen. 
A party vote was called for on the question  
That the Charities Bill be now read a third time. 
Ayes 74 
New Zealand Labour 51; New Zealand First 13; United Future 8; Progressive 2. 
Noes 44 
New Zealand National 27; ACT New Zealand 7; Green Party 9; Maori Party 1. 
Bill read a third time.