New Community and Voluntary Sector Minister Hon Priyanca Radhakrishnan is considering next steps on the paused review of
the Charities Act 2005. Many within the charities and wider not-for-profit sector are calling on her to widen the scope
of the review and to engage with the sector.
The review of the Charities Act 2005 commenced in 2018 and was put on pause in May 2020 for six months. The Department
of Internal Affairs’ Policy Team told Charities Services’ annual meeting that they are in the process of briefing the
Minister on how she might move the work forward and in particular how she should engage with the sector. Spokespeople
for the charities sector say it is important the Minister considers their views – not just the views of a government
department.
Many in the sector are calling for Labour to honour its 2017 election-commitment to prioritising a first principles
review of the Charities Act 2005. Commitments also included consulting with the community and voluntary sector on
whether the disestablishment of the Charities Commission improved things for the sector and “ensuring that community and
voluntary organisations can engage in advocacy”.
Out of the 363 submissions to the 2018 review, 128 commented on its narrow scope. Nearly all said it should be widened.
Most notably, the definition of charitable purpose was excluded and the promised review of disestablishing the Charities
Commission was limited. Around two thirds of submitters also sought an independent review of the Act by a body like the
Law Commission.
ComVoices, a network of community and voluntary sector peak bodies, said in their submission that “The charitable sector has long sought a first principles review of the Act … the desire is for an Act which is
fit-for-purpose in the modern world, provides clear accountability and better boundaries to ensure the definition is not
subject to being distorted through mis-interpretation. As this approach has been rejected, we believe the current review
will not resolve our concerns”.[1]
Birthright NZ, a charity that previous Minister Hon Poto Williams worked for, said in their submission that the current
review is “not giving the recognition this important piece of legislation requires. It is essential sufficient time and
consideration is given to make sure the review has fully considered the diverse nature of the sector. The law must
enable charitable organisations to effectively carry out their work and not work against them in anyway”.[2]
Sue Barker is currently undertaking independent research into the question “What does a world-leading framework of
charities law look like?”. She is the recipient of the New Zealand Law Foundation International Research Fellowship | Te Karahipi Rangahau ā Taiao, New Zealand’s premier legal research award. As part of the research, she has consulted with over 200 people,
internationally and in New Zealand, and has drafted a bill that would amend and restate the Charities Act 2005. Her
report is due in September 2021.
Sue says many improvements can be made to the charities regime: “We need an independent agency to administer charities’ legislation and we need to strengthen the sector’s voice in its
engagements with Government. We also need to get back to first principles and interpret the definition of charitable
purpose as intended - so that it encompasses the amazing and varied work that charities do – and enables a thriving and
sustainable charities sector.”
There are over 27,000 registered charities and over 110,000 other not-for-profits in New Zealand. They are a critical
part of our economy (2.8% of GDP)[3] and our society and the wellbeing of New Zealanders – nearly every New Zealander has a community organisation that
means something to them.
Sue recommends that the new Minister widens the scope of the review so that it looks at fundamental issues such as the
definition of charitable purpose. She is also calling on the Government to support and fund a process of co-design with
the sector.
“There is such a diversity of views, it is very important to follow a “natural justice”-type process that allows the
various voices to be heard and to feel that they have had meaningful input into formulating policy (rather than just
reacting to proposals that have already been formulated).”
“During the Covid-19 lockdown, so many charities were deemed ‘essential services’. It is in all of our interests to take
the time needed to ensure that the law helps, rather than hinders, the good work that charities do.”, says Sue.
To find out more, contact Sue Barker (susan.barker@charitieslaw.co) or visit www.charitieslawreform.com
[1] DIA, Modernising the Charities Act 2005: ComVoices, Submissions 2.
[2] DIA, Modernising the Charities Act 2005: Birthright, Submissions 1.
[3] Stats NZ, Non-profit institutions satellite account, 2018.