The Coalition’s planned crackdown on charities and not-for-profits threatens free speech, gives the regulator overly broad powers, and should be scrapped, a Liberal-chaired parliamentary committee has found.
The government this year announced major changes for charities, that would give the regulator significant power to investigate and deregister organisations that engaged in or promoted a range of minor offences, including trespass, threatening behaviour, and vandalism.
An alliance of 30 charities, named Hands Off Our Charities, said the regulations threatened deregistration for protest activity, including, for example, where a single staff member refused to leave an MP’s office or blocked a footpath.
The changes would allow the Australian Charities and Not-for-profits Commission to investigate charities on mere suspicion of an offence, even if no charges had been laid.
On Wednesday, the Standing Committee for the Scrutiny of Delegated Legislation, recommended the regulations – which are yet to begin – be disallowed.
The committee, which is tasked with monitoring how ministers are using their powers to issue regulations, said the changes threatened the implied freedom of political communication.
They also gave the ACNC commissioner, Gary Johns, a former Institute of Public Affairs senior fellow, “broad discretion in determining whether a registered entity has complied”.
The committee, chaired by Liberal senator Concetta Fierravanti-Wells, said it intended to give notice of a motion to disallow the changes on 18 October.
“The committee draws the attention of the Senate to the committee’s significant scrutiny concerns regarding the conferral of broad discretionary powers on the ACNC commissioner and the impact of the instrument on the implied constitutional freedom of political communication,” the committee said.
“Noting the significance of its technical scrutiny concerns, the committee recommends that the Senate disallow the instrument.”
The government says the changes are designed to reinforce trust and confidence in the sector and “ensure registered charities do not engage in or actively promote unlawful activity”.
But Fierravanti-Wells wrote to the assistant treasurer, Michael Sukkar, on behalf of the committee in July, expressing concern and saying it was unclear which offences could lead to charity deregistration.
“The committee concerns are particularly amplified noting that the discretionary powers to be exercised by the commissioner may relate to the determination of whether a criminal law has been breached,” Fierravanti-Wells wrote at the time.
Sukkar was asked to give greater clarity to charities. But the committee said on Wednesday that it was not reassured by his response, including on the potential limits to freedom of speech.
“While appreciating his responsiveness to the committee, the committee does not consider that the assistant treasurer has provided a sufficient explanation for why the instrument as a whole does not impermissibly limit the implied freedom.”
The committee comprises three Coalition and three Labor members.
The Australia Institute welcomed the committee’s finding on Wednesday. The executive director, Ben Oquist, said the powers would have allowed “deregistration based on suspicion alone” and given arbitrary powers to the commissioner.
“The regulations amount to an assault on freedom and our democracy,” he said. “The Committee for the Scrutiny of Delegated Legislation is right to recommend that this measure be disallowed.”
The matter will now come before the Senate which will have the power to reject the regulations.