The imminent disestablishment of the New Zealand Charities Commission, scheduled to occur on 1 July 2012, if the Government achieves its legislative plans, has caused some serious concerns among those involved in organisations working in the charities sector. However, some are welcoming the move, in particular some of those who have experienced the downside of the “egregious inner machinations of the complaint-driven deregistration process”, as one aggrieved charity CEO expressed it, with its unreasonable and seemingly blind adherence to an out-dated 400-year old Victorian definition of “charitable purpose”.
A number of influencial media commentators have sounded alarm bells over the last few years as groups such as the highly regarded National Council of Women of New Zealand, Business in the Community Limited (Business Mentors NZ – the nation’s number one not-for-profit mentoring organisation), The Business in the Community Trust, the Liberty Trust, and many other charities serving the public good; were systematically ‘picked-off’ by the Commission and deregistered. Liberty Trust has been the only deregistered charity to have successfully challenged the Commission’s deregistration decision in the High Court. The Trust was reinstated as a charity on 15 April 2010.
Few of the charity entities that have faced deregistration have had the financial and/or personnel resources to make such an appeal. Few would contemplate ever using their donors’ money, given in good faith for charitable purposes, to mount a costly and tiresome legal battle against a Commission that can draw on a vast pool of public money and skilled legal personnel, to counter any such an appeal in the Courts.
A statement from the NZ Government in August last year confirmed its intention to disestablish the New Zealand Charities Commission currently headed by Mr Trevor Garrett, and transfer its functions to the Department of Internal Affairs. The Government has followed the principles of nature justice and due process by providing the reasons and the grounds for the reasons for this decision, one which no doubt will impact significantly on Commission staff.
S 48 of the Bill states: “No member of the Charities Commission is entitled to compensation for loss of office resulting from the disestablishment of the Commission.”
When the disestablishment of the Commission was firsrt announced by the NZ State Services Minister Tony Ryall, the public was told that it would result in a saving of $2.032 million in the four years from 2012/2013, improve coordination across the state sector, improve the delivery of services to the public and reduce duplication roles.
Part 3 of the Crown Entities Reform Bill dealing with the Charities Act 2005, received majority support in the House of Representatives as it has passed through its committee stages stages on the evening of 23 May 2012. As a result the Charities Commission will be scrapped in four weeks on 1 July 2012. An amendment to clause 2 of the Bill – contained in a a Supplementary Order Paper (SOP) No. 32 in the name of Labour MP Hon Trevor Mallard – that sought to delay the absorption of the Commission into the DIA until 2015; failed to win sufficient support (64 against/55 in favour).
1. Media Release. Tony Ryall. Reduction in State agencies confirmed. 11 August 2011
2. Charities Commission to be axed. By Andrea Vance
3. Mentors raise fees to counter status change