Great article posted up by Lance from his site http://groupsects.wordpress.com/! Here’s my Christian view: BRING IT ON!
The Australian reports….
“Between now and August 29 the Senate Standing Committee on Economics will receive a flood of submissions into one of the most controversial and political hot potatoes: an inquiry into the disclosure regime for charities and not-for-profit organisations in Australia.
After that, the Senate has almost three months to finalise a report that has the potential to rock Australia’s $80 billion-plus non-profit sector.
The inquiry will examine the appropriateness of disclosure levels in the sector, models of regulation and legal forms that would improve governance and management of charities and not-for-profit organisations and other measures to improve governance, standards, accountability and transparency in its use of public and government funds.
Depending how gutsy the report wants to be, it could recommend a complete overhaul, starting with the creation of a charities commission, similar to the model adopted in Canada, Britain, and New Zealand, which would streamline all charities under the one regulator.
It could also enforce a set of accounting standards to ensure that all not-for-profit organisations quantify and detail the size of tax exemptions, grants and donations, as well as recognising three core business segments: raising funds, administering funds and spending funds.
This would enable charities to be monitored for best practice. It could also take the opportunity to recommend an overhaul of the Banking Act so that if a religious group sets up an investment scheme, it is subject to the same regulatory rigours as any other investment scheme.
At the moment, religious groups with financial activities are exempt from the Banking Act. And if it had the stomach to take on the religious groups, it could recommend a working towards competitive neutrality to bring Australia into line with most other countries by forcing religious groups to pay tax on earned-income ventures such as pizza and coffee chains, cereal businesses, and wineries that have little or nothing to do with charitable work. Every few years new governments launch an inquiry into the not-for-profit sector, which ranges from charities, religious groups, clubs and health funds, in an attempt to fix a sector that represents almost 10 per cent of the economy, employs more than 600,000 people and represents more than 700,000 organisations. This time it was prompted by the Australian Democrats, Andrew Murray and Lyn Allison, who in March called for an inquiry by the Senate. It was their parting gift to a sector that is in a mess. Both retired from politics on June 30.
The Democrats have set the ball in motion, so now it is up to the Rudd Government to do something about a sector in dire need of reform. It is one of the most powerful, far-reaching sectors in the country, yet it lacks governance standards, accountability and transparency in its use of public and government funds. Indeed, as governments increasingly outsource more and more areas of business to the non-profit sectors, by making them government service providers in areas like the Job Network, and sign contracts with them worth billions of dollars, the need for transparency and accountability is critical. In an era of corporate regulation, most parts of the non-profit sector are unregulated.
There is no process for the registration of charities, no consistent collection of information about the activities or funding sources of charities and there is little or no monitoring of the activities of charities. The upshot is there is no means by which the public can ensure that a charitable organisation is pursuing the activities and purposes it claims to carry out. It also means that the Australian Government has no idea how big the sector is, or how much it forgoes in tax a year. The access to charitable status is currently regulated by the Australian Taxation Office (ATO). But the ATO has limited expertise in the regulation of charities. In a submission to a government review of the sector in September 2000, the ATO itself recommended the establishment of a separate body to regulate access to charitable status at the federal government level. “It’s our view that the current system of tax concessions provides an unnecessary layer of administrative cost and complexity, and lacks transparency. We would accordingly favour a single targeted, transparent and accountable program of direct outlays.” Most charities do a terrific job. Some release detailed accounts to the public of how much they earn, and how they spend the money. But there is no law that says they have to _ and many do not.
There is also little accountability of where the money goes or the businesses that these organisations operate. It is no surprise, then, that some not-for-profit groups run businesses. For instance, the Seventh Day Adventists run food business Sanitarium Health Foods, which is believed to turn over more than $300 million a year. The Catholic Church, which turns over more than $15 billion a year, runs schools, hospitals, insurance companies, car parking lots and a funds management business. The biggest Pentecostal church, Hillsong, sells CDs, DVDs, self-help books and T-shirts. Australia is one of the few places in the world where these types of business are not taxed. Most other countries treat companies run by the non-profit sector like any other corporation: forced to pay tax if they make a profit. In the interests of budget honesty and transparency, taxpayers are entitled to know who is entitled to tax concessions under both commonwealth and state legislation……..”