The Charities Amendment Bill (the Bill) was introduced to Parliament on 21 September 2022 and passed its first reading on 28 September. The Bill is now at Select Committee stage and members of the public have the opportunity to make submissions on the Bill. Hon Priyanca Radhakrishnan, Minister for the Community & Voluntary Sector, encourages "anyone, particularly those from the charitable sector, to make a submission so that we can work together to strengthen a sector that contributes significantly to the collective wellbeing of all New Zealanders".
The Bill, if passed into law (expected to be in 2023), will amend the Charities Act 2005 (the Act) which provides a registration, reporting and monitoring regime for charities. Modernisation of the Act has been on the horizon for over ten years, during which time the Charities Commission was disestablished and its core functions transferred to the Department of Internal Affairs (operating under the banner of Charities Services), but a formal review of the Act did not commence until 2018. The Bill aims to "modernise the charities sector by increasing transparency, improving access to justice services and reducing the red-tape that smaller charities face", Priyanca Radhakrishnan said.
In what seems to be a missed opportunity, the definition of "charitable purpose" and incorporation of te ao Māori principles into the Act were not part of the review of the Act although these issues may be considered at a later stage.
The key amendments contained in the Bill are provisions relating to:
- Alignment (where appropriate) with the recently enacted Incorporated Societies Act 2022, including in relation to the definition of "officer"
- Changes to the decision-making process of Te Rātā Atawhai/Charities Registration Board (the independent body which makes decisions about more complex or novel registration and/or deregistration scenarios), including allowing for an extended period of time for charities to submit information
- The Taxation Review Authority's ability to hear first appeals under the Act (rather than the costly High Court process currently provided for) and an extension of the permitted timeframe for appeals
- Reduced compliance burden for very small charities (such as in relation to financial reporting).
We will keep you updated as the Bill progresses through the legislative process.