Australian NGOs face existential shifts as laws change

Australia’s next federal election is expected in May after Prime Minister Scott Morrison called for delivering an early budget in March, paving the way for a campaign fueled by a hopeful economic outlook. But a voice that may be muted in public debate is that of Australia’s NGOs, thanks to newly passed legislation that a previous inquiry warned could potentially silence groups with fears of being classed as political campaigners. “It harms charities to expect them to only deal with the consequences of bad policy rather than allowing them to advocate for changes in policy.” --— Australian Sen. Rex Patrick “The bill was rushed and rammed through parliament without consultation,” a spokesperson for the Australian Council for International Development told Devex. “We are seeking guidance on its interpretation and how it will apply. Our fear is that it will tie charities in knots and the voices of the Australian community will be lost in our national conversation.” This risk to groups advocating on issues such as poverty, refugees, and the environment comes shortly after a tribunal found that Australia’s definition of “public benevolent institution” — or PBI — needed to be broadened to include groups such as Global Citizen, whose work is focused on advocacy around social issues rather than program implementation. What is the new legislation? Promoted as necessary to reduce foreign influence on election outcomes, the Electoral Legislation Amendment (Political Campaigners) Bill 2021 passed in both houses of Australia’s Parliament on Dec. 2, with the support of the government and the parliamentary opposition. This was despite resistance from independent senators and members of Parliament who said it would create an unfair administrative and financial burden on NGOs and charities. “The legislation itself was a transparency measure, and generally I support transparency measures,” Rex Patrick, an independent senator who voted against the legislation, told Devex. “But I think that you need to be fair about transparency. Right now, we have a situation where there’s very little transparency in relation to political donations to [Australian political] parties, yet this legislation calls for transparency to political campaigners in such a way that creates red tape for those organizations.” For Australian organizations advocating on issues important to their members and donors — whether those be anti-poverty work or business lobbying — the new law requires them to register as a “significant third party” if their financial year spending threshold on work around the “creation or communication of electoral matter” reaches 250,000 Australian dollars ($178,000). This has been reduced from AU$500,000, and the changes are applied retroactively. Along with the need to register, organizations are required to appoint a financial controller who is responsible for compliance with restrictions on accepting foreign donations and for the annual disclosures of gifts and electoral expenditure to the Australian Electoral Commission. No foreign donations are permitted for use in creating any electoral communication. More information from AEC is set to be provided in early 2022. “The AEC will be writing to known stakeholder groups, some of which are charities registered with ACNC [the Australian Charities and Not-for-profits Commission] to inform them of the legislation changes,” a spokesperson for AEC told Devex. The electoral commission expects some entities, including charities, will shift in AEC reporting categories and new entities will be required to register, but do not currently have an estimate on the number impacted. To ensure organizations are compliant, AEC said it intends to undertake environmental scanning “and may receive information from the public and other sources to determine whether people and organizations are meeting their obligations” under the Commonwealth Electoral Act 1918, which the 2021 legislation amends. Patrick said questions around what is or will be an “electoral issue” are creating concern for NGOs and risk excluding civil society from the conversation. “I think it harms charities to expect them to only deal with the consequences of bad policy rather than allowing them to advocate for changes in policy and do so in a way that makes the public aware of these deficiencies,” he said. Since the legislation was passed, Patrick said he has “only heard disappointment” from the sector. Advocacy seen as key tool for change Despite the risks to advocacy, a separate tribunal finding has recognized advocacy as an important tool for charities to deliver social change, in addition to directly delivering relief. The Australian arm of Global Citizen applied to be recognized as a PBI in 2018 and had its initial application rejected, and again on appeal to the ACNC. The Administrative Appeals Tribunal reversed these decisions, with the new status allowing for tax exemptions. “The need to adopt a contemporary meaning of the notion of PBI is particularly relevant in the context of international aid and assistance, whether that be humanitarian assistance or developmental assistance,” the tribunal found, saying that “uncontested evidence” suggested advocacy, awareness-raising, and education were common methods employed to tackle global poverty. ACNC told Devex it now expects that “entities that operate in a similar manner” to Global Citizen may be entitled to register as PBIs, but it is not going to review previous decisions to determine whether PBI status was incorrectly rejected in light of the new findings. “The tribunal’s decision was based on the specific facts of this case,” a spokesperson for ACNC told Devex. “By law, the ACNC is unable to comment on the circumstances of individual charities.” More information for NGOs in particular will be provided next year, but how the changes will operate in an environment with additional hurdles created for advocacy remains to be seen.