Public Interest / Private Interest – A Fundamental Distinction

Over the coming month, major political parties will be deciding whether charities should be exempted from new restrictions on election campaigning to be introduced as part of reforms to overseas donations to political parties. Charites should not be treated like other political actors, argues CCA CEO David Crosbie in Pro Bono News, 14 September 2017.

Public Interest / Private Interest – A Fundamental Distinction, Pro Bono News, 14 September 2017

Charity advocacy is under attack on a number of fronts. While we await the appointment of an independent and well qualified Australian Charities and Not-for-profit Commission (ACNC) commissioner to replace the outstanding Susan Pascoe, the major political parties are deliberating about their approach to electoral reforms, including the tricky issue of overseas donations to political parties and “other political actors”.

Experience from around the world, most recently from the United Kingdom, tells us that charities should be concerned about the potential impact of proposed changes to the electoral act. In the UK electoral act reform prior to the last elections has been described as having “a chilling effect on charities during the election campaign”. At the heart of the UK electoral reforms was a requirement for charities to document and audit their advocacy and lobbying expenditure for the 12 months prior to the election date.

The government may be seeking to change taxation eligibility through Deductible Gift Recipient status, change the definition of charity to limit advocacy, and possibly change the role and activities of the ACNC, but all are difficult legislative roads, less likely to succeed or to deliver a clear reduction in advocacy. The electoral act is the best shot the government has that will limit charity advocacy, especially during election campaigns.

Pro Bono Australia News has already provided some coverage of the issues around electoral reform and overseas donations, and why they are important to Australian charities. If charities have to be audited in some way around their advocacy during election campaigns, it will reduce the willingness and capacity of charities to pursue their purpose through campaigning or seeking legislative reforms.

At the heart of CCA’s concerns is the implication that charities are no different in their role and purpose during election campaigns than business or industry groups. Some have talked about creating an equal playing field, not allowing charities that advocate to maintain either their tax concessions or their charitable status.

It is wrong to say that charities are the same as business. Charities should not be rolled into a broad based “other political actors” category. They are very different in four critical ways:

  1. Charities exist for, and must demonstrate, public benefit. They are not about individual wealth creation or private vested interests.
  2. Charities are regulated by a relatively powerful and effective regulator, the ACNC and must demonstrate a sustained focus on their charitable purpose, as well as providing annual reports about income, board directors (and other details depending on size).
  3. Charities cannot engage in direct political activity such as handing out how to vote cards, funding or campaigning for political parties. The ACNC can and does investigate any complaint about charitable involvement in political activities.
  4. Charities reflect their communities. Their voice is the collective voice of public interest.

They are doing what their constituency want them to do and thereby play a critical role in balancing the vested economic interests of the more wealthy and powerful.

The reality is that there is no level playing field when it comes to influencing political decision making.

The most powerful lobbyists and campaigners in Australia are almost invariably wealthy private interest groups seeking to ensure their own financial benefit is protected and enhanced by government policies.

It is private interest that drives the Pharmacy Guild of Australia (representing the 3,000 or so anonymous pharmacy owners) to spend whatever it takes to protect their exclusive monopoly and location rules on the distribution of pharmaceutical drugs. It is private interest that has them threatening any political party that does not support a $4 billion a year government payment to pharmacy owners.

It is private interest that drives the soft-drink industry to oppose measures that would reduce obesity, like a sugar tax.

The big alcohol producers, importers and retailers all oppose a floor price on alcohol and an alcohol tax system based on the amount of alcohol in each product – measures that have been shown to reduce hospital admissions, domestic violence and deaths associated with alcohol misuse. The alcohol industry are pursuing self-interest – they want to make as much money as they can.

The gambling industry is happy to pay governments and political parties an annual premium, as long as it can continue to create addiction and extract income from some of the most marginalised communities in Australia.

Fossil fuel companies have a very high stake in the zoning decisions and license systems that provide them access to our natural resources. The more they can expand their operations and increase their profitability, the happier and wealthier they are.

Almost every area of public policy is a battleground where vested economic interests seek to sustain or increase their income, often at the expense of public interest.

Greed is not good, personal wealth is not public benefit, serving communities is not the same as maximising financial returns to investors, empowering communities is not the same as seeking personal power.

Charities engaged in public advocacy and campaigning are pursuing their charitable purpose, providing a public benefit, reflecting public interest.

The charities sector cannot let the government conflate all political actors into one big category of equivalent vested interests.

If proposed reforms to the electoral act on foreign donations and campaigning do not exclude charities, charitable advocacy will decrease, the voice of communities will be diminished, and our democracy will be increasingly held captive to unaccountable vested economic interests.

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