Australia’s legal definition of charity will no longer be based on a 400-year-old English statute, following the passage of the Charities Bill (2013) through Federal Parliament on June 27.
After years of inquiries, setbacks, prevarication and debate, the Bill sets in place a single statutory definition of what is and isn’t charitable.
Previously, Australia's definition of charity relied on interpretations the 1601 Statute of Elizabeth – also known as common law.
Australian Charities and Not-for-profits Commission (ACNC) Acting Commissioner Murray Baird said the Bill would make it easier for not-for-profits groups to pursue their purpose through advocacy.
“This new, statutory definition ensures that charities can advocate changes to laws, policies and practices without jeopardising their charitable status,” Mr Baird said.
“Prior to this Act, it has been difficult to explain to the public what a charity is in law. This definition will make it much clearer and transparent,” he said.
“The Act modernises the law by clearly recognising charitable purposes such as the protection of human rights, the promotion of reconciliation and tolerance, and by recognising that modern charities advance causes by preventing, educating, researching and raising awareness.”
Changemakers’ Grantmaking Development Manager Esther Abram said the introduction of the new definition would benefit the entire not-for-profit sector.
“Replacing out-of date case law with a single statute has enormous benefits including greater certainty, reduced red tape and costs and a stronger framework to encourage philanthropic and individual giving,” Ms Abram said.
“A key benefit of the legislation is that charities can advance their missions through advocacy, without risking their charitable status,” she said.
The definition will preserve principles of common law with some small variations. It will also take into account the findings of recent judicial decision – the Aid/Watch v Tax Commissioner decision in particular, which extended the abilities of groups to promote informed policy debate.
However the passing of the Charities Bill won't see an immediate change to Australian law, as the Federal Government has confirmed the introduction of the statutory definition of charity will b delayed until January 1, 2014
There is also the threat that an incoming Coalition Government will repeal the new definition if it wins power at the upcoming Federal election.
Shadow Minister for Families, Housing and Human Services Kevin Andrews told Parliament during debate on the Bill that a Coalition Government would return to common law for its definition of charity.
