Using the ACNC Register to decide where to give in a crisis

A couple of my friends have asked me who they should give to if they want to give cash – the right gift by the way – to help Nepal.  Right after one of the Assistant Commissioners of the Australia Charities and Not-for-profits Commission (ACNC) shared, on LinkedIn, the Australian Council for International Development’s (ACFID) 28 April post on just that question.  The ACFID encouraged Australians to donate to the 31 ACFID members listed in their post.

But which one (or more if you like, but less than 31)?  How to choose?  The ACFID says that they are all equal, but left any statement about how confident you could be that your money would (a) get to Nepal, or (b) be used effectively, to your confidence in ACFID.  The Assistant Commissioner was more helpful though to the average giver, going on to say in his post that these 31 were ‘charities that you can support with confidence’.

So, my friends, is it wise for you to accept this recommendation, saying that these 31 charities met all reasonable objective tests for charities in whom you can have ‘confidence’, and therefore move to your personal preferences to select one or more recipients for your gift?  I say not.  I say that there is some basic ‘due diligence’ that you can do (or have done for you).   And the place to start is the place recommended by the ACNC:  the ACNC Register, a register of all charities registered in Australia[i].

Let’s see what happens when I put the first nine and the last six of the ACFID’s 31 charities to this test.

The aim is to get down to a much smaller number than 31.  It’s a humanitarian crisis so speed is important; I will therefore eliminate or retain a charity based solely on what is said in the register[ii] (or its attached documents).

First up, approximately 25% of a charity’s entry is devoted to describing and showing where in the world the charity operates.  We are giving to Nepal, so if ‘Nepal’ is not mentioned in the ‘Operates in (Countries)’ list, we would want to check on its website.  Unfortunately, even though this is one piece of information thought important enough to put on the one and half pages of information on each charity, and the Commissioner promotes the use of the charity’s website if you want more information, it is absent for two charities:

       Act for Peace, and

Anglican Board of Mission – Australia

Out for these two then.

Second, is there a recent financial report of the type required by the ACNC to look at?  Not for these five:

ActionAidAustralia

ADRA

Australia for UNHCR

Lutheran World Service, and

UNICEF Australia

[Comment added 5 May 2015].  For the first and last of these, they are only in the list because of my requirement for recent financial statements, not for a non-compliant report.)  If you are happy to either rely on financial information that is at least 16 months old, then please remove them from this list add them to the list in the final paragraph.

Down to eight now.

Third, is there an audit report included in the financial report?   That eliminates Australian Himalayan Foundation, the one charity in the list that works solely in Nepal.

[Comment added 5 May 2015].  I missed the audit report (two paragraphs under another heading).  However, because the financial report, including the audit report, is a concise/summary report rather than a full report, the result is the same.

Fourth, did the auditor give a ‘clean’ opinion?  For two of my 15, he couldn’t.   These two:

Transform Aid International

World Education Australia

(And particularly disappointing, given that we are making a donation, was the fact that both the qualifications were because the charity had decided that it couldn’t implement controls to ensure that all the money intended for it actually got into their bank account.)

And for Anglican Aid, the auditor tells us that because the financial report, a special purpose report, was designed for the Anglican Synod of the Diocese of Sydney it ‘may not be suitable for another purpose’.  Not confidence inspiring for the donating public, so out it goes too.

That leaves just three charities out of the 15.  Union Aid Abroad – Apheda has submitted their Annual Information Statement (AIS), but it was three months late, and that was after being allowed seven months after their year-end to submit.  Dents the confidence, so out it goes.

Anglican Overseas Aid – not to be confused with Anglican Aid above – submitted their AIS on time, but their financial report was three months late.  I’ll let you decide whether they stay in your shortlist.  If not, we down to two:

Leprosy Mission Australia and

World Vision Australia

Extrapolating, that’s four, maybe five out of the 31.  Let me know if you need help with a couple of further objective criteria to get the number down further.

 

 

 

[i] For instance, in their latest media release, they said “we encourage the public and donors to use the Charity Register as a resource to help them make informed giving decisions” (http://www.acnc.gov.au/ACNC/Comms/Med_R/MR_125.aspx).

[ii] I had assumed that they would at least all be registered charities.  I was not disappointed.  I had also assumed that they would all be up-to-date with the lodgement of the required Annual Information Statement.  Again I was not disappointed.  (Although if this research had been a few months earlier, there are at four that may have failed on this criterion, having submitted their AIS after the standard period allowed.)

‘Basic religious charity’: a justified exemption?

The first of the ACNC[i]’s three objects is to ‘maintain, protect and enhance public trust and confidence in the sector through increased accountability and transparency’. Laudable. But why, then, does a multi-million dollar unincorporated charity that is

  • primarily about promoting religion,
  • running a DGR[ii] fund, and
  • has repeatedly received $100 000 in government grants

not have to

  • disclose any financial information, or
  • comply with the ACNC’s governance standards[iii], and

can have people running it who cannot be suspended or removed by the ACNC?

The answer? Because it is a ‘basic religious charity’. This includes the typical Uniting, Anglican, or Catholic parish.

But, you say, why, given the ACNC’s object above, would the legislation provide for this huge exemption, this black hole of accountability and transparency? Good question. The only reasonable answer is that these charities are already subject to equivalent measures, and therefore to impose the same requirements on them would be a duplication. Is this the case though? If you are a donor to one of these religious charities, and it has revenue greater than $250 000,

  • do you get given an industry standard financial report showing the parish’s finances?
  • is there a mechanism to remove those in charge?
  • does the parish follow governance practices equivalent to these?

If not then you have lost out by the introduction of the ACNC.

 

 

 

 

 

[i] Australian Charities and Not-for-profits Commission

[ii] Deductible Gift Recipient. See http://www.acnc.gov.au/ACNC/FTS/Fact_DGR.aspx.

[iii] These standards ‘require charities to remain charitable, operate lawfully, and be run in an accountable and responsible way’.

Are you really going around it?

Somebody said it’s pretentious, but I prefer to say that it’s just in vogue. Ignorance, not affectation. I don’t know its history but I don’t like it. It’s not a big deal, but it’s my blog, so I can get petty if I want to. What is it? It’s the use of ‘around’ when ‘about’ is meant.

I only had to look at the first five results for ‘media release’/Australia in Google to find an example:

The event brings together the community and leaders in a conversation and public debate on issues around Australia’s identity and the future of our nation (emphasis mine) [http://www.premier.tas.gov.au/releases/australia_day_address].

According to Roget’s there are only two meanings for ‘around’: ‘nearness’ or ‘surroundings’. See, neither of them suit what the Premier is trying to say. ‘About’ has both these meanings as well, but it also has a third that fits perfectly here: ‘concerning’. Alternatives are ‘touching’ or ‘regarding’.   Of the three I prefer ‘concerning’, but what’s wrong with a simple ‘about’?

If you haven’t noticed it you will, this being around things when there’s neither proximity or approximation meant. Just like when you last bought a car, that model will then be all about – or is it around?

Will you help me make it go out of vogue?

The ACT Government’s ‘Mr Fluffy’ solution: a poncho when a fit to the body is required?

The ACT Government is going to demolish 1000+ houses in Canberra, ACT.[i] Their common denominator? They were either subject to a 1989-1993 Government program to remove visible and loose fill asbestos insulation (‘Mr Fluffy’), or they are one of the five houses identified subsequently as having been missed at that time[ii]. So, irrespective of the current level of contamination – for a number of reasons it varies widely – these houses will be demolished. So, if your home is on this Government list, never mind your personal circumstances, you have no choice: you must not only find somewhere else to live, but also resign yourself to later seeing a clear block where once there was your home.

Given the seriousness of this step, it is arguable that for this decision to be the correct decision, demolition must be the correct decision for each and every one of these 1000+ houses. If there are houses on the list that don’t qualify for demolition, and the owners are against demolition, then overruling them is a result of expedience, administrative convenience, or political risk management. Shades of Big Brother.

The Government has based its decision on the report produced by its taskforce, the Asbestos Response Taskforce[iii].

Despite saying that ‘Much has been written about approaches to managing risk of exposure to asbestos in the (sic) industrial and domestic settings’, the Taskforce quote only one publication, Safe Work Australia’s Code of Practice on How to Manage and Control Asbestos in the Workplace (the Code)[iv]. Note ‘workplace’, not homes.

Nowhere in the Code is demolition as a method of controlling the risk of exposure discussed – or even mentioned. The Taskforce quotes the Code’s ‘hierarchy of controls’, but this hierarchy has removal at its top, not demolition.[v] Its only other use of the Code, although providing strong support for removal of friable asbestos, has slightly conflicting advice. It first says that friable asbestos that is in good condition and is not ‘in an area where it poses a significant risk of exposure’ can be left in place; it then immediately says that asbestos-contaminated dust (ACD), and loose fibre insulation are ‘instances where removal may be the best control measure’. [vi]

If we accept that removal is the best measure for the asbestos in these 1000+ homes, then presumably the Taskforce has good evidence that this advice, removal, is not feasible, and that therefore demolition is the only option.

Their argument against removal is compelling. But this is hardly surprising given that they define removal as ‘a full internal demolition and rebuild’ with an aim of ‘100 per cent removal of the asbestos[vii].

There are two arguments against this interpretation of ‘removal’, both of which are in their own report.

The first is that they say that ‘sealing and cleaning’ is acceptable as a solution to make the house liveable for the next five years.[viii]   So surely if a less drastic solution than removal can make the house liveable – and whether it is one, two, five, or perhaps more years (there is no defence of the five year period) – then removal defined as something less than a full internal demolition should be able to get more life out of the home than five years?

The second is the Taskforce’s lack of evidence that the level of contamination in all 1000+ houses requires a full internal demolition.

In fact, they give other information which, collectively, throws considerable doubt on this interpretation of what is required in order for the homeowner to continue to live in the house:

  • “There are…no specific studies of the health impacts of exposure to loose asbestos fibres present as insulation in homes…” [ix]

To what extent is the lack of evidence causing the Government to take the safe option?

  • “The leading Australian studies of domestic exposure risks come from Wittenoom in Western Australia…and studies of home renovators in Western Australia….Those studies indicate that it is relatively rare for an individual to develop asbestos related disease even with significant exposure. However, if large numbers of people are exposed to even a low risk of disease then this increases the probability that one or more people will be affected.”[x]

 Is it fair on a homeowner who has very good reasons to stay, to have the decision based on the population rather than their individual risk?

  • “…loose asbestos insulation in wall cavities is unlikely to present a risk if left undisturbed…”[xi]

In how many of the 1000+ houses is the insulation restricted to the wall cavities?

  • “More than 50 per cent of homes assessed since February 2014 have had asbestos fibres detected in living areas.” [xii]

 Given that ‘around 200’ assessments had been completed when the Government held their ‘roundtable of regulators and asbestos assessors’, it would not be unreasonable to conclude that a not insignificant(suggest you use significant – not insignificant is confusing in all this info) number of the 1000+ homes did not have fibres in their living areas. This is significant because it is only this finding that results in a risk rating of ‘Very high’, meaning that ‘exposure to airborne asbestos (is) likely as a consequence of minor disturbance.’ If there are any houses on the Mr Fluffy list with a risk rating of Medium – ‘exposure…unlikely’ or lower it is hard to justify a full internal demolition if the owners don’t want it.

  • “As at 19 August, 40 families are unable to continue to reside in their homes as a result of asbestos contamination.”[xiii]

 I don’t know what proportion this is of those assessed, but I do know that it means that a significant number of the 1000+ homes are, with restrictions and heartache of course, habitable.

  • “In relation to the affected homes:…All of them will have a level of contamination of asbestos ranging from higher than background levels to extreme in a smaller number of cases.”[xiv]

 In the absence of an aim to remove 100% of the asbestos in all 1000+ homes, this is an argument for a solution based on the level of contamination.

  • “The consistently held view throughout the Taskforce’s consultations on this issue is that there is no effective, practical and affordable method to render houses containing loose fill asbestos insulation safe to occupy in the long term. It is the similarly consistent view that most houses can, with significant effort, be rendered safe to occupy in the short to medium term.”[xv]

 Given the range of contamination, is it valid to say that they would all require ‘significant effort’? And even if this is the case, doesn’t the fact that they can be made habitable into the ‘medium term’ mean that, they can, with continued effort, be habitable in the long term?

What then are the Government’s aims? For if one of them is the complete removal of asbestos from these 1000+ homes, then unless the home has been mistakenly included on the list, they are, at least on the information they give in the report, correct in concluding that demolition is the only solution:

“Considering asbestos was applied as loose fill insulation into difficult to access cavities such as ceiling and wall spaces, and the asbestos has migrated to subfloor cavities, it is considered unlikely that 100 per cent removal of the asbestos could be achieved. Furthermore, it is considering unlikely that even the best industrial vacuum cleaner could achieve 100 per cent removal.”[xvi]

Their report is in response to the third of the ‘three key functions’ they were given by the Government:

“Providing advice on approaches to securing an enduring solution to the presence of loose fill asbestos insulation in the affected homes.”[xvii]

So the answer to our question depends on whether 100% removal is the correct interpretation of ‘an enduring solution’.

Solution to what? If the issue is defined as the presence of loose fill asbestos, then, yes, the only ‘enduring solution’ is to demolish the houses, clean the block, and bury the waste. One size fits all. Bulldozers and burial that ensure that Mr Fluffy is, once and for all, consigned to the history books.

However, if the issue is to respond to the issue of Mr Fluffy while recognising that not all 1000+ houses are equally affected, and, more importantly, that the circumstances – ability to handle a move, customisation of the house and land, including garden, risk preferences, age, health, ability to handle change, integration in the neighbourhood, proximity of friends and family, settled patterns of behaviour, willingness to adapt to a changed use of the home, finances, etc etc – of the homeowners vary widely, then no, one size doesn’t fit all.

Clean and clinical versus messy and compassionate. ACT Government, please look again at your aims.

 

 

P.S.  Ted Sherwood is the Principal of Business by The Book, a charity that exists to provide accounting, audit and governance services, for no fee if necessary, to not-for-profits who are themselves serving those the vulnerable of the world.

 

 

 

 

 

 

 

 

 

 

 

 

[i] Katy Gallagher MLA, Media Release, Buyback and demolition program announced for ACT ‘Mr Fluffy’ homes, 28 October 2014.

[ii] The Legislative Assembly for the Australian Capital Territory, Government Response to the Standing Committee on Public Accounts, Report of the Inquiry into the Proposed Appropriation (Loose-Fill Asbestos Insulation Eradication) Bill 2014, , 2014, Recommendation 40

[iii] Asbestos Response Taskforce, Long Term Management of Loose Fill Asbestos Insulation in Canberra Homes, ACT Government August 2014

[iv] Safe Work Australia, Model Code of Practice – How to Manage and Control Asbestos in the Workplace, Australian Government, Canberra, 2011

[v] Asbestos Response Taskforce, page 20

[vi] Asbestos Response Taskforce, page 21

[vii] Asbestos Response Taskforce, page 22

[viii] Asbestos Response Taskforce, page 23

[ix] Asbestos Response Taskforce, page 5

[x] Asbestos Response Taskforce, page 5-6

[xi] Asbestos Response Taskforce, page 9

[xii] Asbestos Response Taskforce, page 17

[xiii] Asbestos Response Task Force, page 17

[xiv] Asbestos Response Task Force, page 20

[xv] Asbestos Response Task Force, page 2

[xvi] Asbestos Response Task Force, page 22

[xvii] Asbestos Response Task Force, page 2