Ancient charity law needs a reboot: expert

Professor Matthew Harding, a barrister at the Victorian Bar and a professorial fellow at the University of Melbourne, made the remarks at Per Capita's John Cain lunch in Melbourne last week, where he expanded on themes in his recent book Charities & Politics, a plain-English analysis arguing for stronger charity law, especially in regard to advocacy.

"There is no right or wrong time to seek legislative reform that can further clarify the law. There is only now.

"I think governments of all stripes have shown that they can reach for the levers, when convenient to do so, in ways that can be quite disruptive to charities with advocacy agendas," Harding told Community Directors after the event.

"There is great value in charities having the confidence to get on with their missions and to engage with government and the public around awareness-raising, policy development and law reform agendas – the confidence to do that without looking over their shoulders all the time and worrying about what the law might deliver to them."

The SCA, an alliance of 170 charities, has been pushing back against laws and regulations that silence charities for more than nine years. Last year, most signed an open letter to the Prime Minister urging the government to introduce new laws and offering model legislation to show the way. This week, the SCA launched a new campaign, aligned with the June parliamentary sitting period, combining billboard advertising, lobbying of federal lawmakers and social media posts.

The campaign says “Charities must be free to speak up for the communities we serve.

“This week, organisations across the country are coming together to support stronger protections for charity advocacy. When charities are silenced, communities lose an essential voice in public debate and policymaking.”

The alliance says the necessary reforms align with those flagged in the Not-for-Profit Sector Development Blueprint, which recommended legal reforms by the end of the year.

Harding agreed the lack of legal protection had a chilling effect on the sector.

"The story for charities has been that there has been inadequate legal protection for their advocacy activities," Harding said. "In that area of advocacy, governments have been able to pull levers in ways that have made charities reluctant to speak out."

He said the underlying body of law, whose origins date back to 1601, was so complex that navigating it imposed increased costs on the sector.

"It's a very complicated body of law. It's built up over hundreds of years. It's the product of judge-made law, legislation and regulation. I think many in the sector would say it's far too complicated and trying to navigate what it requires costs time and money."

"To the extent that the law is not clear, it costs charities time and money because one of the things charity governors have to do is get to grips with what the law requires of them. That's time and money many organisations don't have because they're operating on tight budgets and trying to direct their efforts towards helping the people they serve."

In his speech, Harding said: "The history of charity and politics is an uneasy history.”

His talk ranged across centuries of case law to argue that what charity advocacy needs is not just favourable court decisions, but a principled legal framework rooted in liberal democratic values.

He noted that a key 1917 House of Lords ruling – that organisations seeking law reform could not be charitable – had migrated across the world of common law before Australia's High Court swept it away in its landmark 2010 decision in AidWatch v Federal Commissioner of Taxation. That finding, that political advocacy is of public benefit, was later codified in the Charities Act 2013. But Harding says the law still falls short of giving charities the confidence they need.

"I note that there are draft bills floating around, some of which have emanated from the charity sector itself, seeking to further entrench the freedom of charities to engage in political advocacy without risking their status in law.

“The Stronger Charities Alliance has been doing work on that front in recent years and continues to do so. Those developments are to be welcomed, because it is the legal framework that will ultimately secure the principled basis on which charities can operate.

“We cannot leave that all to the disposition of executive government from one year to the next. Many charities would say that, at the moment, there is a relatively friendly disposition, but we know those settings can change very rapidly."

More information

Matthew Harding talks about Charities & Politics, in the video below: