In December 2013 the ACNC released the Commissioner’s Interpretation Statement (CIS) on Indigenous charities. The purpose of this CIS is to provide guidance to ACNC staff on how charity law applies to Indigenous charities, including the recognition of Indigenous disadvantage, applying the public benefit test and the effect of the new Charities Act 2013 (Clth) (Charities Act).
Below is a summary of five main points from the CIS:
We will consider each of these in turn as we examine the law prior to the new Charities Act and the law under the new Charities Act, which commenced on 1 January 2013.
There is widespread public acknowledgement of Indigenous disadvantage in Australia by governments, parliament, the courts and international organisations. The disadvantage suffered by most Indigenous people is caused by or linked to ‘poverty’.
(i) Common Law
At Common Law there are four heads of charity. The first head of charity is for the relief of poverty, the needs of the aged, impotent and poor.
It is necessary to distinguish whether the disadvantage fits with the ‘relief of poverty’ or the ‘impotence’ components of the first traditional head of charity as this determines whether the public benefit test needs to be applied. This applies for all charities, where the charitable purpose is addressing poverty, there is no need for organisation to meet the public benefit test.
The ‘relief of poverty’ has been accepted by the courts as not equating ‘to destitution or even on the borderline of destitution. Instead it connotes the notion of “going short” – an inability “to obtain all that is necessary, not only for bare existence, but for a modest standard of living”, or to achieve the status of being “self-supporting”’. Other types of disadvantage fit within the category of ‘impotence’.
The term ‘impotence’ is considered to now include ‘…beyond sickness and disability, the underprivileged, the vulnerable, the dependent and those without family.’
(ii) The law under the new Charities Act
The new Charities Act contains a list of 12 charitable purposes and to be eligible for registration by the ACNC now requires addressing at least one of these purposes.
The traditional first head of charity for the relief of ‘poverty’, the needs of the aged and impotent is reflected with the new purposes of ‘advancing health’ and ‘advancing social public welfare’ in s 12(1) of the new Charities Act.
Section 14 of the new Charities Act elaborates that the purpose of ‘advancing health’ includes the purpose of preventing sickness, disease or human suffering. There is a presumption of public benefit for this charitable purpose under s 7(a) of the new Charities Act.
Section 15 of the new Charities Act sets out four inclusive elements of the definition of ‘advancing social or public welfare.’ Relevant for the purpose of addressing Indigenous disadvantage include the purpose of; relieving the poverty, distress or disadvantage of individuals or families, caring for and supporting the aged or individuals with disabilities.
The public benefit test lies at the core of the legal concept of charity. A charity must direct its benefit to the general public or a sufficient section of the general public. Generally, the public benefit test is considered to exclude a group of beneficiaries related by descent or blood or that is a closed group.
(i) The law under the new Charities Act
Section 8 of the new Charities Act states that a charity with ‘the purpose of relieving the necessitous circumstances for people in Australia’ does not need to meet the public benefit requirement in s 6(1)(b) of the new Charities Act.
An Indigenous organisation will satisfy the public benefit test if its members/beneficiaries are described in terms of family relationship or descent from named apical ancestors associated with a particular geographical area.
The relationship between Indigenous people, an area of land and their traditional laws and customs has been recognised in Australian law and described as a ‘native title claim group’ as described in section 62(2) of the Native Title Act 1993 (Clth) or ‘traditional owner group’.
These ‘native title claim groups’ or ‘traditional owner’ members/beneficiaries will be accepted as benefitting a sufficient section of the public as required by the public benefit test.
Section 9 of the new Charities Act contains specific provisions for organisations whose purpose is for the benefit of Indigenous people who are related.
In Aboriginal culture, kinship and society are virtually the same thing. Kinship classification systems operate designating categories of close kin. For example in Arrernte culture in central Australia, everyone is described as a relation of some kind, even if they are not directly related through blood or marriage.
Therefore, whether an Indigenous ‘native title claim group’ can meet the public benefit test should be considered on a different basis from the common law authorities that were considering a charitable trust for the descendants of an individual or individuals in a western family.
We note that this summary is of limited value as a result of the proposed changes to the ACNC.
This article originally appeared in Third Dimension – Summer 2014.
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